If your existing 401(k) is moving to Gusto Retirement partway through the year, you may see a task asking for reports from your prior provider.
This task won't delay your plan start date, but you do need to complete it. Without these reports, Gusto can't run your conversion year compliance testing in the following plan year. When you complete it, Gusto uses your full plan-year data to run that testing at no extra cost.
Note: If your converted plan has a start date effective the first day of the plan year, we will be able to run compliance testing without just certain prior year compensation and ownership data.
Every 401(k) plan needs yearly limit testing and nondiscrimination testing. Nondiscrimination testing helps confirm that the plan is operating fairly and according to IRS rules.
In general, Gusto Retirement only has plan and payroll information from your Gusto plan start date forward. To run accurate conversion year testing for the full plan year, we may also need information from your prior 401(k) provider.
Important: Gusto needs the requested reports in order to run your conversion year testing, which takes place in the first quarter of next year. If you don't provide them, Gusto will still start your plan on time, but we won't be able to run your testing and you'll need to work with a third party to complete the testing.
Yes, if you want Gusto to run your testing for the conversion year. We ask that you complete this as quickly as possible. If we don’t receive the requested information, we won't be able to run your conversion year compliance testing with your full plan-year data.
However, please note that this does not block onboarding and will not delay your plan start date.
Your task may include up to three sections, depending on your plan setup:
This section asks for year-to-date 401(k) compensation and employee contribution data from before your plan moved to Gusto.
You'll only see this section if your prior 401(k) wasn't already connected to Gusto payroll. We will need this information for January 1 of the current year through to your Gusto Retirement 401(k) plan start date.
This section asks for:
Distribution history from the last five years, such as withdrawals or payouts
Ownership information and related details needed for top-heavy testing
This helps Gusto evaluate whether the plan's balances and distributions affect conversion year compliance results. We will need this information for January 1 of the current year through to your Gusto Retirement 401(k) plan start date.
This section asks for employer contributions that weren't processed through payroll, such as:
Profit-sharing contributions
True-up contributions
Other employer contributions made outside Gusto payroll
We will need this information for January 1 of the current year through to your Gusto Retirement 401(k) plan start date.
You will see an email template provided for you directly within the task that you can use to request all the information needed. For a compliance report or deconversion report, you will need to work with your prior provider.
If possible, ask for one report that includes:
Year-to-date contributions
Distribution history
Employer contributions made outside payroll
Ownership details, if available
Gusto accepts reports in PDF, Excel, or CSV format.
We encourage you to ask for these reports early, while your relationship with the prior provider is still active.
We ask that you submit these reports as soon as possible. However, it’s typically best to wait to request your reports until after your Gusto Retirement 401(k) plan starts and your first 401(k) payroll contributions have gone through to your Gusto Retirement 401(k) plan to ensure all data for contributions and distributions made at your prior provider is included.
That helps make sure the information you request is complete before you submit it.
Sign in to your Gusto 401(k) dashboard.
Choose the task Submit prior provider reports
Select Start.
Use the pre-written email in the task to request reports from your prior provider.
When you receive the reports, upload the file or files for each section.
Select Submit.
If it's easier, you can also email the reports to your Onboarding Specialist, and they can help upload them.
What happens after you submit
After you submit the task, our internal team will review your reports.
If everything looks good, Gusto Retirement uses that information for first-year compliance testing.
If something is missing, incomplete, or unclear, the task is sent back to you in your Gusto 401(k) dashboard with a note explaining what needs to be fixed. You can then update your files and resubmit the task
Even if you’re unable to obtain all the requested information, please submit what you have.
If a section doesn't apply to your plan, or you can't get the information, you may see options such as:
I can't provide this report
There were no contributions during this period
Gusto will review the information you do provide and communicate any remaining testing limitations within your compliance dashboard experience.
If information is missing
Missing information can limit how accurately Gusto can handle conversion year testing. Please read below to see how certain missing information can impact your testing:
Compensation information – Profit sharing won't be available for your first plan year and nondiscrimination and limit testing will be inaccurate.
Distribution history – The top-heavy test may be less accurate for up to five years.
Employer contributions made outside payroll – Testing for those contribution sources will be limited.
If you skip the task, your plan can still start on time, but Gusto won't be able to run your conversion first-year compliance testing. You'll see a warning banner on your compliance dashboard, and will be responsible for arranging any needed first-year testing yourself or with a third party, such as a CPA.
We recommend submitting your reports before we run the conversion first-year testing for your plan, which is typically done in the first quarter of the following year. However, you can still submit them after that, up until we file your Form 5500 for the plan year.
Note that submitting data after the first of the next year may result in needed corrections if you have not already run annual testing using a third party.
After this has been filed, we’ll no longer be able to accept submitted reports. However, you can still reach out to our client support team to submit your distribution history to ensure top-heavy testing is accurate going forward.
Your Onboarding Specialist can help you understand what to request, when to upload it, and what to do if your provider gives you incomplete records.
For general questions about onboarding your plan, check out our Onboarding FAQs for plans converting a 401(k) to Gusto article.