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ADP refunds are not particpant-driven transactions. The decision is made by the plan administrator. The custodian should rely on the representations of the plan administrator and/or trustee in cases like these. Most of the record keepers I dealt with took direction from me (acting as 3(16) Plan Administrator). But I don't see why they can't/won't take direction from the Plan Administrator. Are these brokerage accounts?

Congratulations on the retirement. Enjoy the next stage of your life!

We are working with a client where we did not process all of the refunds for the failed ADP test by March 15, 2025. The refunds have been done for all but 2 participants out of a total of 50 required to receive refunds. The 2 participants no longer work for the client and the investment company requires the participant signature on the refund form. They will not sign the form. Do we the client deposit a QNEC for the refund amount of those 2 participants?

If the employee will have about $195,000 in Social Security wages (box 3) on one 2025 Form W-2 wage report, that would make her a § 414(v)(7)-affected participant for 2026 (if she otherwise is eligible for an age-based catch-up). That a portion of the wages was from union labor does not by itself exclude that portion from § 414(v)(7)’s measure of Social Security wages. This is not advice to anyone.

The employee earned non-union and union compensation from one employer. His W-2 from the one employer includes both non-union and union compensation. He did not receive any compensation from the other employer in 2025.

Situation: H had an IRA. H died. W survived. She did not rename the IRA into her name as owner. She did not take any MRDs, even for those years she had reached and passed her RBD. W dies. The IRA balance is moved into an "estate account." Then, W dies. Her executor has the funds in the IRA moved to an "estate account" and then, 1/5th each transferred to five new "inherited IRAs", one each for the five children. How do we resolve the failure by W to take MRDs? Were the funds taxable when transferred from the IRA to the estate account (since estates per se cannot be IRA owners)?

If a participant has more than one common-law employer, 26 C.F.R. § 1.414(v)–2(b)(4) (not yet codified) sets detailed rules about whether one need not or may aggregate Social Security wages from two or more employers. https://www.govinfo.gov/content/pkg/FR-2025-09-16/pdf/2025-17865.pdf at pages 44549-44550 [pdf pages 23-24].

Does the employee get incremental compensation because she opted out of health coverage? To the extent the employee has a choice between health coverage and an increment of money wages, isn’t that a choice that must be properly made under a § 125 plan? Else, the employee has constructive receipt of the more valuable benefit she could have chosen. If an incremental choice between an increment of money wages and health coverage is available to less than all health-eligible employees, does that incremental plan meet § 125 nondiscrimination? If an opt-out amount might be added to what would be the employee’s portion of the health insurance premium, does that cause the employer’s offer of health coverage to be not affordable for one or more Affordable Care Act purposes (and related income tax and excise tax consequences)? Does an opt-out offer violate HIPAA nondiscrimination? Does an opt-out offer violate Medicare secondary-payer provisions? Beyond those and other questions: Is the employer’s opt-out offer a breach of the group health insurance contract? Or does the offer make false the application for the group health insurance contract. What are the legal consequences of such a breach or false inducement? If a false statement to the insurer is not corrected, is that a Federal crime, a State crime, or both? This is not advice to anyone.

If so, is there a stock report I can run? Do I ahve to get my backend team ro create a crystal report for this? More questions: I think maybe I'm asking if there is a rate of return report that can be run with ad hoc dates? Could it be run on a plan-wide level but with participant detail? The accounts are daily-valued in the Relius ecosystem.

Is the opt-out credit offered to all employees who waive (and the others just declined by enrolling in the health plan instead)? Or is the opt-out credit offered to only this one HCE to waive? If it's the former, it's probably fine. If it's the latter, it probably violates the uniform election rule.

A small employer offers only fully insured medical insurance to its employees and employees pay their share of the cost of coverage through a cafeteria plan. One (and only one) highly compensated employee is provided with additional cash compensation for opting out of the medical coverage. Does this violate the benefits portion of the cafeteria plan nondiscrimination tests? If so, what is the consequence to the one HCE? Thanks.

There are 2 Corps in the controlled group. Employees of both Corporations receive union and non-union income. The W-2 they receive each year includes both and we back out the union comp for calculation of the SHM.

Dude, congratulations!!! You have taken the time and thought to make more than 6,700 posts to these message boards, over more than 24 years. What a helpful and loving contribution you have made to your peers, the employee benefits industry, and hence to plan participants and plan sponsors all over the country! Unfortunately, your request for retirement is denied. (The fine print is in the Terms of Service, the plan documents, or somewhere.)

LOL, all of those designations mean nothing compared to my true claim to fame - International Man of Mystery! Though if you do seek an ERISA attorney, I know a good one! Here is a little more color. Assume a day care center is called Day Care I, LLC. Day Care I, LLC is owned by Susan 100%. Susan owns 51% of Day Care II, LLC and Day Care III LLC and the manager of those facilities own 49%, respectively (two different people). They have one website, DayCare.com. All three locations are listed and co-branded. Taking the position that this is an Affiliated Service Group would be very conservative and reasonable based on my position that a playscape is not a material income producing factor for a Day Care center. Having one 401k for all three and running one ADP test, I just don't see how that could be challenged. If you want to take the other position, I strongly endorse one Peter Gulia to do an analysis of the facts and circumstances to see if it can be defended. For example, maybe Susan wants a SH Match 401(k) for her employees in Day Care I and knows it would never pass coverage taking into account Day Care II and Day Care III (the other owners do not want to spend the money). That could be a reason to investigate that position. But as a TPA, I would not endorse administering that way without a "Peter Guiia" letter in the file approving it. Note: I did not look up the ASG rules here, but I'm pretty sure because they are not professional service entities, the entity type stuff is not an issue. My example is based solely on the affiliation and common ownership. I'll note the original question made no reference to whether there was an affiliation, but I assume the question would not have been asked otherwise.

I have made the (not all all difficult) decision to retire at the end of this year. I have agreed to work a couple of days a week during the early part of next year to help out my employer while they hire a replacement, but it's a limited engagement. I'll be lurking on these boards for a while yet. I'd like to take this opportunity to thank Dave and Lois for providing this magnificent resource - it has been a tremendous asset! I'd also like to thank all of you folks, past and present, for the invaluable assistance you have given to me over the years. I've certainly taken more than I've given, and your time, generosity, and expertise is appreciated more than you can ever know. It's not just the technical expertise, but the sounding board for discussions, sometimes griping (misery loves company) and humor in the face of statutory and regulatory foolishness that makes this such a great community. I wish you all the best in your future endeavors (I'm trying hard not to gloat) as you continue in this business, and I hope you all have a great Holiday season! Take care, and again, a heartfelt thanks!!!

Or a letter from a certified public accountant who is eligible to practice before the IRS.

Are both amounts paid by the same common-law employer? Or does the business divide union and nonunion jobs between two or more companies?

Tangentially related, perhaps: my understanding that a housing allowance paid is not counted for 415 compensation purposes and a deferral cannot be withheld from such a payment (it’s already not subject to income tax). Deferrals are withheld from income. My preference is to have the section 107 “minister of the gospel” elect a fixed dollar deferral amount. And because the eventual retirement payment from the plan can also be counted as housing allowance (up to the limits allowed) and thus not subject to income tax, perhaps they be especially careful about electing Roth, as that could result in paying unnecessary income taxes.

for July Business Services (Remote / Waco TX)View the full text of this job opportunity

Plan Sponsor has non-union and union compensated employees. Union compensation is excluded from the plan. One of the employees will have W-2 FICA wages of about $70,000 in non-union compensation for 2025 and W-2 FICA wages in union compensation of about $125,000 for 2025. Is the union compensation included to determine if the employee's compensation is over $150,000 for Roth catch up for 2026?

Absolultely. When you compare a day care with a machine shop or Walmart, there are stark differences. It would be quite dangerous to argue a day care is not a service business. They might have a huge playscape that they paid a lot for, but is that playscape a material income producing factor? I don't think so... Plus to me it seems like the danger lies in assuming NOT a service business. To err on the side of caution means concluding it IS a service business. I personally would not assume it was not a service business wihtout a letter from an attorney.

for Ameritas (Remote)View the full text of this job opportunity

If more than one interpretation could be a reasonable interpretation, consider writing an explanation of each plausible interpretation—and the advantages, disadvantages, and risks of each—so your client can make an informed decision about which interpretation it will use. Or, doing the work to research and write an explanation might help you refine your thinking, with one interpretation becoming clearer or stronger, and another interpretation seeming weaker.

“This is exactly the reverse of what Congress was trying to accomplish.” But how do we know that what Congress sought to accomplish is something different than what the enacted text provides? Among many challenges in interpreting recent years’ tax legislation is that there often is no committee report that describes the text Congress enacted.

I have had audits in the past, never this long. I am aware of the personnel changes at PBGC, especially with legal department, so nothing to do but wait. Thank you for your input.