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probably fails 1.401(a)(4)-5 plan amendment (a)(2) facts and circumstances on my humble opinion, eligibility to let in an 'executive', I assume someone who will be an HCE, but simply isn't because he was just hired. they didn't treat any other employee this way. and then, to follow up by changing eligibility back clearly indicates the intent to favor an HCE because now we are no longer letting 'everyone' in. but then, maybe I take a different view of facts and circumstances. I don't look at just year one and say, "But he is not an HCE yet" I suppose if the executive is not going to be an HCE it isn't a problem, but that seems like an awful lot of trouble to bring someone into the plan you want to favor.

...and there is the rest of the story. Always a problem when plans are changed to favor "execs." If they want to change back, I would recommend still, keep it simple....

No offense, but it's questions like this that make me want to go back into private practice specializing in correction of plan operational errors.... The short answer is "yes, but...." Potentials for errors in mis-characterizing an employee's classification, mis-calculation of required service for that class, problems when one changes job classification (say, a teller works 4 months and is in, but then moves to a job that requires 6 months to be eligible)., testing issues and the like. We have problems with just dual eligibility requirements (deferrals and match) or with "part-time" (one year, 1000 hours) and "full time"(something less than a YOS). Getting more specific just makes the plan that much more difficult to administer. Before getting into the weeds, what exactly is the plan sponsor attempting to accomplish with such a situation?

Thank you. So in two situations, it seems clear to me that an HRA can reimburse: 1. Retiree only HRA 2. Subject to the parameters of IRS Notice 2015-17 (and other applicable guidance) and the MSP rules. But in a 125 plan, I'm still less "certain" of the answer, although it does seem to me that you can't. Thanks again for the link.

My husband's retirement gig is driving for a limo company. A couple of years ago he had great fun driving Neil Sedaka. They sang in the car all the way to the airport. Neither my husband's co-workers nor mine had any idea who he was.

your best bet would be to try to establish a relationship with a current TPA because what you are asking is not a small question or easy answer. Try to find one to partner with or takeover because they will have that knowledge and be able to share it with you. Trying it go it on your own is going to be tough. Many TPAs started out working a different path (HR consulting firms, the big daily 401k houses, etc) and have gotten experience way before ever starting a TPA firm. It truly isn't just expanding into a new niche. and being snarky with a long time poster isn't going to get you much from other long time posters.