Fourteen states have failed to update income tax laws to conform with changes in federal law that allow increased participant contributions to 401(k) plans, creating new headaches for defined contribution plan administrators.

Some consultants are advising multi-state employers to delay plan amendments until the states comply with the Economic Growth and Tax Relief Reconciliation Act (EGTRRA), which increased the maximum yearly 401(k) contribution to $11,000 and lets participants over 50 make an additional $1,000 "catch-up" contribution.

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