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Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.
The contribution amounts do not need to be prorated. You can contribute the max amount for 2013 even though your plan didn't start until September.
And for your second question, yes you can change 6% to 16% in 2014
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thank you! few more question..we have in-house employee in charge of payroll. 1) Do we need outside 401k administrator? 2) How can we update payroll for 401k plan? thanks
Yes, you will need a 401(k) administrator and I would not know how to update your payroll system. You would have to speak with whoever set your payroll system up.
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thank you !