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Do you have a written plan document? If so, who did that for you? Talk to them. If not, then you don't have one or two plans. You have NONE.

I could be totally off on this, but... As related to the SECURE Act for >70.5 in 2020: EE terminates in 2020, actuarial adjustment is from 70.5 to current age (75) EE terminates in 2021, actuarial adjustment is from 72 to current age, and therefore may actually be smaller than if terminated in 2020, simply due to SECURE Act age change rule? (no lump sums applicable to plan in question).

Interesting, thanks. In pulling documents from EDGAR and other sources, there seem to be a few other alternatives, including several that explicitly state that the trustee will deliver all withholdings back to the employer for remittance and reporting. My overall reaction is that splitting up the reporting, remittance, local tax (if applicable), FICA, 941 info, and multiple W-2s is convoluted. It would seem easier to have the employer run payment through its payroll, show proof of payment to the trustee, and request reimbursement from the trust. The few examples I've found explicitly permitting that approach are from the early-to-mid 2000s so maybe preferences have changed? Alternatively, this article ran in Spring 2020 and suggests the reimbursement approach should be acceptable, even if not explicitly addressed in the IRS model document: https://www.thompsoncoburn.com/insights/publications/item/2020-04-27/rabbi-trusts-taxation-basics-and-drafting-beyond-the-model-language Either way, it sounds like the ultimate answer is that there's not one clear answer. Appreciate your input and time.

The plan has to be adopted and effective before money is withheld from his pay; that's about all.

My experience is that the Rabbi Trust will provide the employer information for the employer to do the 941 filing but will provide a separate W-2 to the participant. That seems to be pretty consistent. The trust I work with most will withhold and remit federal and state income taxes only and will leave it up to the employer to handle FICA and local taxation, as applicable.

But don't get lost in the fraud forest because of the formal trees. One must have legitimate earned income as a base for qualified plan contributions. This is often addressed when children are involved with a parental desire to to provide for tax deferred savings for the children as part of wealth transfer and tax avoidance/evasion.

Without going back to check, iirc code M has been around since the 2018 Form 1099-R following the changes made by TCJA. Regardless, the only difference between a code M and a code 1/2/7 is that the participant gets extra time to roll it over. If they were not intending to roll it over then it doesn't matter. If they do want to roll it over and are going to rely on the extended deadline, they might be able to get away with just attaching a note to their tax return, but it would be safer to issue a corrected 1099-R.

Your wife needs earned income to contibute, so when you say you will give her the money, it would have to be as some sort of taxable income, either as W-2 from your company, in which case she can contribute to your plan, or as 1099 income from your company to hers, in which case she needs to set up her own plan. Whether that income is legit is a different matter. If you're doing this on your own...good luck, you have enough rope to hang yourself.

Gilmore, I am addressing this as a hypothetical, since I cannot comment on an individual situation or provide advice in this forum. Deferrals must be withheld. Unlike the tax payment, the employee cannot write a check for the amount. So I don't think that is a possible solution. If the company has set up a cashless exercise program through a broker, it could probably have the broker withhold the elective deferral amount, as its agent, just like the employer may withhold the exercise price and/or FITW and FICA. If the above does not work, it could withhold from future cash payments in a reasonable manner. Those are just suggested answers to your hypothetical. Maybe there are other solutions that will be suggested.