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RBD was 4/1/2021 and first distribution calendar year was 2020 (but RMD waived), second distribution calendar year is 2021 with 12/31 due date, that didn't change.

Incident submitted and I will certainly let you know what they said!

I actually missed the "wild west" days of being able to do bottom QNECs. We had a client in the ''90s that refused to say no to their HCEs and refused to do refunds for failed ADP tests. But they didn't really want to put money in the plan to pass. We would do these crazy bottom up QNECs that would give people who quit in the first week of the year 100% of their deferral as a QNEC that would quickly get us a passing test for a fraction of the cost of a flat or consistent percentage to everyone QNEC. I had a boss in the early days of Age Based PSP plans that wrote crazy formula like we would allocate 3% of pay on the first $100k of comp and 75% of pay on all comp over $100k. Throw in those very loose age based rules in the '90s and you had a passing plan. And my land some of the perpetually refinanced participant loans I used to see! As far as I can tell some of the early TPAs I worked for are the reason there are so many rules regarding how not to abuse the rules. 😁

If a plan’s administrator uses a summary of material modifications (rather than a restated summary plan description), consider this logic path. An SMM describes “any material modification to the plan and any change in the information required by section 102(b) of [ERISA] and § 2520.102-3 of these regulations to be included in the summary plan description[.]” 29 C.F.R. § 2520.104b-3(a) https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-C/part-2520/section-2520.104b-3 The referred-to rule about the contents of a summary plan description requires “[t]he name, title and address of the principal place of business of each trustee of the plan[.]” 29 C.F.R. § 2520.102-3(h) https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-C/part-2520/subpart-B/section-2520.102-3. The need for a name and address follows the preceding requirement that an SPD or SMM include “a statement that service of legal process may be made upon a plan trustee or the plan administrator[.]” 29 C.F.R. § 2520.102-3(g). Even if a change in trustee from one bank to another is innocuous and otherwise immaterial, the information is not idle. For some ERISA claims, a participant or beneficiary must sue the trustee, even if only so the court will have jurisdiction to order the trustee to do (or refrain from doing) something. And the plaintiff or her attorney needs to know where to send the process server. About the timeline, the plan’s administrator may furnish its SMM as late as “210 days after the close of the plan year in which the modification or change was adopted.” 29 C.F.R. § 2520.104b-3(a). Depending on when the plan’s sponsor adopted or adopts a cycle 3 restatement, is there an opportunity to integrate the trustee information with an SPD or SMM used to meet other disclosure needs? Also, has the plan’s administrator considered electronic disclosures for those who affirmatively consent, are required to use electronic communications as an “integral part” of the employee’s work, or furnished (or were assigned) an electronic address and did not opt out of an electronic-disclosure regime?

Oh! Becasue 414(n)(4) is titled "time when first considered as Employee" That's it!! Thanks!

Austin, I think it flows from the definition of Employee which is section 1.29 in my cycle 3 Corbel Master Text and reads: "Employee" means any person who is employed by the Employer. The term "Employee" shall also include any person who is an employee of an Affiliated Employer and any Leased Employee deemed to be an Employee as provided in Code §414(n) or (o).

Yes and yes, these ERISA rights must be listed in the SPD. I cut and pasted the applicable language from one of ours: Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan, including insurance contracts and collective bargaining agreements, and copies of the latest annual report (Form 5500 Series) and updated summary plan description. The Plan Administrator may make a reasonable charge for the copies.

I did some Googling and found the interaction that Mike referred to, from the 1999 ASPPA Annual Conference. https://www.asppa.org/advocacy/irs-qas-1999 That's it, one word for an answer. I agree with Belgarath, this is confusing, as there does seem to be a distinct possibility of a non-discrimination issue. To answer the question from earlier, as to why I think it would be unlikely that this would be nondiscriminatory: When the owner is acting as the trustee of the plan, they are going to select a mix of investments that they feel will meet the needs of the plan, regardless of what the participants in the plan might want or would have chosen if they'd had the chance. In the plan covering the employees, the participants are not going to get a chance to give their input on the plan's investments. What I don't understand is how you could expect such a person, in the position of the trustee of an account that only covers themselves, to not consider their own investment preferences. Maybe there is someone out there who could invest their own account as if they were a disinterested 3rd party, but I don't think that's the same person who would go out of their way to set up a whole separate plan for themselves.

I got the answers to my inquiry - thank you all very much. 401(a)(4) is the answer I was looking for. All three plans will be aggregated for testing purposes; have recommended a platform for the employee plan. One of the dentists is balking at this I told him if it wasn't done this way, I'd walk away and he is free to find another TPA. Thanks to all for your input.

"Super integrated" to me always conjured up an image of laundry detergent. I have no idea why it brought that image to mind...

"Super integrated" I kind of miss the creativity and cleverness (?) of having to do that, as opposed to having everyone in their own group.

You two are scratching me where I itch and I'll be waiting to see what you find out. I have suggested the safe route of counting the service for eligibility and vesting also. This is probably one of the top 3 painful topics me for to discuss with Employers that use temp services......it all seems so murky.

The underutilized amount is equal to zero since they were not eligible for the plan before, so the catch-up is limited to that, which is zero. Now 2021 is over. If they entered in 2021 and no allocation was done for 2021, then they have an underutilized amount now equal to $19,500 which can be used now. Also, read the 3-year language carefully, my understanding is that the year they reach normal retirement age is not a year that can provide a catch-up, it’s the 3 years prior to the year they reach normal retirement, but check the document.

I could see an argument for it if the owners are each wearing their "trustee hat" when selecting the investments for their own plan. In reality though I think this is extremely unlikely to be the case.

Ananda, I like the steps you have suggested and in addition would recommend counselling/training for the employee on the issue and documenting the training in the file.

The right to direct the investment of your account is a benefit, right or feature that has to be available to all participants on a non-discriminatory basis. Even if they split the plan into 3, the two owners' plans would not satisfy coverage testing on their own, so they would have to be aggregated with the plan covering the employees for nondiscrimination testing purposes. If the effect of the change would be that each of the owners would have the ability to direct the investments of their own accounts, but that option would not be available to their employees, then that would be discriminatory.