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A small business sells to a larger business. The new owners have their own 401k plan. The small business 401k plan and business fiscal year are 7/1 - 6/30. The business was sold on October 1. The status of the small biz 401k plan was not addressed in the sales agreement (crazy, i know. We just found out about the sale today, almost 2 months later). Theres more involved but an initial question: Who would make the decisions on if/when to terminate the small biz 401k (I do not believe a plan merger is being considered)? The plan document and trust agreement still show the small biz owners as the trustee. Thank you

for EPIC RPS (Remote / Norwich NY)View the full text of this job opportunity

I would like to make one comment to this statement to confirm my understanding. I agree that the timing is irrelevant. However, I don't believe the Final Regulations change the nature of a catch-up. Meaning a catch-up is still an amount that exceeds a limit, but any Roth deposit may satisfy the requirement. For example, let's say a 401k plan document is written to not match catch-up contributions. In January 2026, a participant (age 55) funds $8,000 Roth and $0 pre-tax February - December the participant funds $24,500 pretax. $0 Roth The Roth dollars satisfy the rule, but they are not catch-up dollars. The final $8,000 pre-tax dollars are still the catch-up dollars and stay as pre-tax. Therefore if a plan uses a pay period match formula, the Roth dollars are matched, the final $8,000 of pre-tax is not. This may be semantics, but I would change the statement to say: The first Roth dollar deposited can be used to satisfy the Roth catch-up requirement.

Comments from @Paul I are reasonable. and helpful. There may be another situation to consider (and prepare for). Maybe the participant is "incapacitated", and the caller was a relative (perhaps an adult child) who is assisting with a legitimate disbursement. Imagine, for example, that the participant has some cognitive issues, but there is not (yet) any formal diagnosis or power of attorney to allow the adult child to take unilateral action. Of course, it's also possible that it's both: a relative who is "helping" and also committing fraud. Use your imagination to include any other scenarios that might require the plan sponsor to be wary and/or know what steps are required.

Pam, thank you for your input and comments.

Derrin, I’m so very grateful for everything you’ve done for the retirement community and, especially for me. Without you (and Doug Jolley), I can’t imagine having survived the early difficulties in what became my career. Starting my own business way before it was rational to do so, I leaned rather heavily on PIX just to keep my head above water. Thank you, though that is woefully inadequate.

I believe that is in the case where the required minimum contribution exceeds the sole-props Schedule C net income, and not all cases where the employer simply makes a contribution larger than the maximum deductible amount.

I agree with Paul's suggestions. Take reasonable precautions to prevent fraud since it is already suspected in this case.

Jayasar, you are correct. 1. Highly Paid Individuals for 2026 are those that earned more than $150,000 (indexed) in 2025, based on FICA wages (Box 3 of W-2). It is a lookback provision. 2. Those without W-2 wages (i.e. sole props, partners) are currently exempt from having to make catch-up as Roth. 3. Roth provisions must be in place before the first Roth contribution. The timing of the Roth catchup contribution is irrelevant. The first Roth dollar deposited can be counted as Roth catchup. The participant does not need to exceed the 402(g) limit for the contribution to be counted as catch-up. 4. One note of caution if you have HPIs that solely earn W-2 and are not HCEs: if the plan does not permit Roth and the HCEs get to make catchups (pre tax) because they don't earn W-2, but the HPIs are prevented from catchups, then you have a benefits, rights and feature issue. In your example, since owner makes $50k in W-3 income, they are not subject to the Roth Catchup requirement.

Since there are very good reasons to be suspicious of the request, you and the plan's fiduciaries need to protect the plan from potential fraud. Otherwise, if the request is fraudulent, then there will be a lot of finger-pointing (and potentially litigation) about who will make the plan and participant whole. If there is a concern about inviting the individual into your office or the client's office, consider choosing a public, safe place to meet. This could be at a bank or even at a police station, depending upon the level of concern. The purpose is to arrange for a notary or plan representative to validate the individual's identity. Ideally, someone who could recognize the participant could be available. If the level of concern is at the level that the plan fiduciaries are comfortable just having an election form notarized without their being present, then consider listing on the document being notarized specific items for the notary to confirm was presented at the signing. This could be at least one item with a picture (like a driver's license), and any additional documents that would acceptable like an original Social Security Card, Medicare ID or something similar. Ultimately, it is the plan fiduciaries call on how to approach the issue, but you need to make it abundantly clear to them that you believe additional steps need to be taken to confirm the participant's identity. We have not dealt with this particular set of circumstances, but have had a couple of incidents where we expressed our concerns to the plan fiduciaries and worked with them to document the participant's identity to their satisfaction. These are just some thoughts and is not advice to anyone.

Well done! I can echo, after 40+ years as an actuary, it was difficult to "let go", so I endorse your gradual approach. Retirement is great!

@S Derrin Watson, you have been a trusted advisor, teacher, lecturer, and author for my entire career in the industry. I can easily say that you, @Ilene Ferenczy, and Sal have shaped me into the practitioner I am today. I wish you the best as you start this new chapter of your life!

😮noooo!!! Well, for the rest of us. Thanks for everything over the years, Derrin, and enjoy the wind-down!

Darrin you are the one and only person who has ever done singing continuing education classes that I have been in. You bring up your name in this industry and the conversation turns to the signing instructor. You also taught all of us a lot in those classes. Enjoy retirement.

Echoing @Belgarath and wishing you the best on your gradual exit from the industry. Hopefully others will continue your legacy so the next generation of service providers will know "who's the employer?" After 40+ years in the industry myself, I must say that my fondest memories of your contributions to us all were your musical renditions that added spice to otherwise boring and mundane (to most) topics. Enjoy life!

@Connor and @Belgarath, thank you both!

It isn't really possible to adequately describe the profound impact (all good!) that you have had during my career in this business. Congratulations on the "slowdown" - and from a purely selfish standpoint, we are delighted to hear that the teaching and the ASK will still be on the table for now. Best wishes!

Hi, ho, Silver! We all wish you the very best as you enter this new phase of your life. We have valued having you as a resource, and we are glad that we will still be working together with ERISApedia. Be well, my friend, enjoy your life and family, and know that you are always in our thoughts. We love you - Ilene, Alison, and the rest of us at FBLC

In 1977, as I began law school, I started working as a law clerk and was quickly given responsibility for the firm’s qualified plan practice. When I passed the bar in 1980, I stepped fully into a career that has now spanned more than four decades. As I begin to slowly wind down those years as an ERISA attorney, I am deeply grateful for the opportunities that have come my way and for the encouragement and help of so many good men and women. I never dreamed, in the ’70s and ’80s, where this practice would take me. As this year began, my ERISA work fell into six main roles: I’m an author. I have written or co-authored five books dealing with retirement plans, and am nearly done with my sixth—the ERISA Fiduciary Navigator eSource—all published by ERISApedia.com. I head the ERISApedia ASK service, where my protégé, Adriana Starr, and I answer questions from ERISA practitioners. I present webcasts and live seminars on retirement topics. I draft plan documents and interim amendments on behalf of the Relius division of FIS. I serve as of counsel to the Ferenczy Benefit Law Center. I assist some clients in a private practice. One of the observations that has struck me over the years about the Employee Retirement Income Security Act is that it never defines “retirement.” My own working definition has been “separating from service once you’re old.” But the older I get, the older “old” gets. Still, as I near RMD age (even after SECURE 2.0), it's time to start thinking about saddling up and riding into the sunset. I envision retirement as gradually dropping things out of the saddlebags. So, with mixed emotions, I announce that I will no longer be acting as of counsel to the Ferenczy Benefit Law Center or conducting a private practice. I will consult on special cases, but otherwise, for now, my professional endeavors will focus on writing, teaching, FIS, and the ASK service. Planning for the financial side of retirement has been the easy part. The emotional and professional side is more challenging. My hope is that a slow and gentle ride toward tomorrow will make that transition easier. I am profoundly grateful to the colleagues, clients, and friends who have shared this journey with me—and I look forward to continuing to write, teach, and cheer you on from slightly lighter saddlebags.

for Leading Retirement Solutions (Remote)View the full text of this job opportunity

This is simply a general discussion to make sure I understand the concept properly. The question I am asking and trying to confirm my understanding: the Roth catch up is solely based on lookback salary regardless of ownership, salary is based on w-2 box 3. Looks like sole props and partners with k-1's are exempt from this. So, per my example above and my understanding, the owner who makes 50k in salary does not need Roth catch up i.e. normal catch up. One more thing, as explained by a friend, the plan needs to have Roth provisions in place before the first Roith catch up contribution. Any comments/corrections/missed information?

I have a client who just got a call from a "former participant" requesting to cash out his profit sharing plan account balance. However, the caller (1) mispronounced the participant's name, (2) lacked an accent even though the participant had a heavy accent, and (3) didn't seem to know the person he was talking to, even though she had worked with the participant for 20 years. She's "nearly 100%" sure the person she spoke to is therefore NOT the participant. She suspects it may be his adult son. Where do we go from here? My initial thought was to ask the caller to come to the client's office to sign benefit election paperwork in person, although I really don't like the idea of inviting the imposter into my client's place of business. I'm now leaning towards "requiring" that the forms be signed in the presence of a notary, then scrutinizing the signed forms (if he returns them) and reporting to EBSA if necessary. Anyone dealt with something like this?

for CPS, Inc. (Los Alamitos CA / Hybrid)View the full text of this job opportunity

Sure (although those do help keep the lights on around here ...). Two methods, depending on how you use your feed: Method 1: Create a custom Activity Stream (cleanest) Go to Activity > My Activity Streams > Create New Stream. Under Content Types, select what you want (usually Topics/Posts). Scroll to Forums and uncheck the forum(s) you want to hide. Save the stream. Click the star to make it your default stream. This becomes your personal feed; the excluded forum will never appear. Method 2: Clone the default “Unread Content” stream Open Activity > Unread Content. Click Show Filters. Under Forums, uncheck the forum to hide. Click Save as New Stream. Name it (e.g., “Unread – No Jobs”). Star it as default.

Is there a way to get the job listing posts out of my stream? I find they are clogging up my feed.