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Huh? The outstanding balance the day before the new loan was $49k. That's the highest outstanding balance in the prior 12 months. That leaves a maximum of $1,000 that can be borrowed. I'm not even going to try to figure out your math because it makes my head hurt! :-) The purpose of the rule is to PREVENT a perpetual loan, which is what you are attempting; that's a Bozo No No! Larry.

I'm always amazed (and I don't know why) at people coming to this board with "questions" and getting upset at the answers. If you're so confident in your position, why come here?

Nope, I just did some important research that says that she signed black bats with a golden pen in Jacksonville for the Jacksonville Suns in June of 2001 at that "Tonya Harding night". Tom were you there, perhaps hosting?

how can the destruction of disco records be a bad thing?

Getting way off topic but.... I to this day think the late '60s to the late '70s was the golden age of album cover art. To this day one of my favorite one is Rush's Moving Pictures album cover. It has a triple entendre: On the front cover you see the members of Rush carrying art work into a museum looking building. They are moving pictures. On the back cover the band is watching a movie. The old fashion term of that was "moving pictures". On the side of the album cover the band can be seen crying while seeing the pictures. Thus, the pictures are emotionally moving pictures.

I am still trying to wrap my mind around the idea that the owners are members of the union. The strong implication is that this would be a single employer plan, not a part of a multi-employer plan. So who tries to hold the line on cost when there are negotiations?

The only thing I see you're missing is profitability. Call me a coward, but I would run from this "prospect" as quickly as possible. No way they are going to be willing to pay enough to make this worthwhile.

I would add if you look at the example Mike P links to one of the quirks of these rules is you are often times better off taking a 2nd loan (if the plan allows) then repaying the 1st loan. In that example the person with an $80k balance and an $18k loan balance could take ANOTHER $22k taking him to the $40k limit. (IRS seems to ignore the 12 month look back part of the rule in the example.) If the person in the example pays the $18k he can take a $23k loan. But that nets him an only an additional $5k and his total loan balance is the $23k. Everyone I know seems to acknowledge this is an odd quirk but also how the rules work.

The problem isn't his cite it is his math or maybe his understanding of the words in the Code. When you write this you are wrong: 50,000- (49,000-49,000)=50,000 The amount of current outstanding loan the moment before the new loan (and moment is a better word to understand what the IRS is means when the say day) is $0 So the math goes like this: 50,000-(49,000-0)=1,000. Look at the IRS example in the link provided by Mike P. If you don't like how the IRS is using the words " the outstanding balance of loans from the plan on the date on which such loan was made, " take them to court and good luck. But what they have consistently said in examples, regulations and so forth is the balance the moment before the new loan is issued is what those words mean. .

The gist of the TAM Mike referenced was that once someone (anyone) has earned the right to a benefit under existing plan provisions, the formula can't be changed. In this case, let's say Mary is still employed with 500+ hours of service. If she quits, she has 500+ hours of service and gets an allocation. If she is still working at the end of the year, she gets an allocation. There is no scenario in which she does NOT get an allocation, therefore she has satisfied the requirements to get an allocation and the formula can't be changed.

Absolutely NOT required. The partners can use any allocation method that they have agreed to, and it is not even required that such agreement be in writing. I believe my original outlines on SE Comp calculations included a discussion of that issue (but I'm home now and the outlines are at the office so I can't confirm).

Could there be an amendment effective 2015 hiding out there? I could be naïve in my old age, but it is hard to imagine there are still "bad" TPAs. On second thought, I worked for a bundled provider 7 years ago, I pointed out what they were allowing in a plan I reviewed was an operational failure. They acknowledged it was, but they didn't want to change because "it might upset the client" and the bundled provider had been doing it wrong for years. I stuck around for about 3 more weeks and started my own firm.