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About Vlad401k

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  1. That's what I figured. Just wanted confirmation. Thanks.
  2. Thank you. That was very helpful. What about SEP? Can it be merged into a 401k plan or does it have to be terminated too? Thanks.
  3. What happens to the existing loans when a plan changes loan provisions? Let's consider these scenarios: 1) There were 2 loans allowed in the past, but now the plan is amended to allow only 1 loan. Can participants who had 2 loans outstanding prior to the amendment still maintain both loans? 2) What if a participant with 2 loans wants to refinance them? Can he do that even though the plan only allows for 1 loan now? 3) What if the participant had loans outstanding and the plan was amended to not allow any loans. What happens to the existing loans? Can the participants still refinance? Thanks in advance.
  4. Can SIMPLE IRA be merged into a 401(k) mid-year. I know the SIMPLE IRA cannot be terminated mid-year, but can it be merged mid-year into a 401(k) plan. If not, would it be required to wait until the end of the year, then terminate the SIMPLE IRA and rollover the assets into the 401(k) plan. Thanks in advance.
  5. Thank you, Tom. That was very helpful.
  6. I'm trying to figure out how DATAIR generates the Permitted Disparity Factor (for DB portion). Is there a table that is referenced? I thought it was based purely on Retirement Age, but it looks like the participant's age also has an effect. Depending on these two variables, I get a value between 0.32% and 1.1%. The calculation seems strange to me as it increases up to 1.1% if the retirement age is 70, but then drops down to 0.75% if the retirement age is 71 or later. Does anyone know if these calculations are correct? I read somewhere that the max rate should be 0.75%, which is why I'm questioning the accuracy. If so, could you please provide the table that's being referenced? Thanks.
  7. Let's say the participant elected to defer a bonus payment, but the company did not deduct the deferral or match attributable to that. I have a couple questions: 1) Does the missed deferral get categorized as QNEC or "Deferral"? Would it be attributable to the year in which the missed deferral should have taken place for Form 5500 purposes (accrual basis)? 2) Does the missed match get categorized as QNEC or "Match"? Thanks in advance.
  8. I have a general question about Bottom Up QNECs. Does the employer have to give the QNEC to the lowest paid employees first or can the employer pick and choose the employees that receive the QNEC? Thanks,
  9. Hi, So, does that mean that the date by which the distributions have to be made in DB plans stays as April 1st of every year? Thanks.
  10. Hi, I don't usually work with Defined Benefit plans. Could someone please confirm if the RMD dates are different for DB plans than for DC plans? Is the RBD April 1st of the year following the year in which the first RMD is required and then it switches to December 31st of each year after that? Thank you.
  11. Let's say the participant is terminated and has a loan outstanding of $10,000. The company then does the loan offset and the participant receives a 1099-R with code "1" or "7" for $10,000. Can the participant then rollover these $10,000 within 60 days to another 401k or IRA as if that amount was a direct distribution?
  12. Thanks, Kevin C. That was very helpful. I have another question about successor plans. What about loans? Let's say the loan is made from the deferral source and then the employer creates a successor plan. What happens with the loan? My thinking is that it must be transferred to the successor plan because it's technically from deferral source. What are your thoughts? What if the successor plan does not want to allow loans?
  13. Hi, I recently read a provision that stated that for prototype plans, the number of allocation rates for NHCEs is limited to at most 25, but could be even less depending on the number of participants. Do you know if this provision still applies, or if it no longer applies after PPA or because of some Revenue Procedure? Could someone please clarify if this provision still applies to Prototype plans? Thank you.
  14. Hey, I had a question regarding successor plans. Let's say a company terminates a plan and immediately starts a new successor plan. What would happen to the sources (deferrals, Safe Harbor, match, etc.)? I believe the deferrals and Safe Harbor sources would have to be directly transferred and still be treated as those same sources in the receiving plan (subject to the distribution rules applicable for deferrals). However, what about the discretionary match and profit sharing? Would those be transferred as the same sources or would they be treated as a rollover? Would a 1099-R have to be issued for the discretionary sources, but not for the deferrals and Safe Harbor contributions? The thinking is that when there is a successor plan, the discretionary sources can be distributed, so just wanted to know how they should be treated if transferred to the successor plan. Any help would be appreciated.
  15. Thanks. Would the lost earnings have to be calculated at all? I can see it being argued two ways: 1) The match was still funded within the company's tax filing deadline, so there the contribution was not late. 2) The document states that the contributions are done on pay period by pay period basis and therefore the contribution was late. What would you say is the best way to handle this situation?