Leaderboard

If owner doesn't want to contribute for employees and employees don't contribute enough to let owner benefit much then why have the plan? Dump the plan, have owner do an IRA max and move on. If you wanna dance, pay the piper or get off the dance floor.

Not sure if it is a joke, but it is possible, depending on your crediting rate. If you are using 30-year treasuries, or a very low crediting rate, when you accumulate at a low crediting rate, then discount at a higher PPA funding rate, your FT is often lower than your account balance. Depending on your demographics, and the interest rates being used, this can result in a maximum deductible that is lower than the sum of the account balances.

Yes, they would be excluded, unless the plan specifies otherwise. They would be non-excludable for your coverage test if they met the age and service conditions. The plan document should contain a section that describes what happens when an employee moves from an eligible class to an excluded class.

This can easily happen if the plan is overfunded either by high investment earnings or funding the max in prior years. I'd trust the actuary is telling you the correct results.

And, of course, WTF is the actuary asking of you? Can't he tell? Easily? Something just doesn't add up.

Taking all of the above into account, of course it doesn't sound right. And, site unseen, I'd wager a fair amount that it is not so. But it *is* possible. Without a whole bunch of information there is no way to tell.

Especially the younger the owner(s) compared to NRA, as the difference between the (low) ICR and (higher) funding rate compounds over a longer period.

Does the plan document not say how to (present) value benefits? If any benefits could be paid as a lump sum there should be a provision stating how such lump sums are calculated, or there may be reference to (and possible offset from) an existing pension plan and such plan's actuarial equivalence may be the proper method. If none of that applies, then I think your NQ plan needs to be amended upon plan termination to provide the basis for determining lump sums.

It was the combined value; the limit for 2006 was $100k, the Pension Protection Act increased the limit to $250k for 2007. But that is a very long time ago... it would be very hard to have maintained accurate records going back that far, especially when you consider the damage you took in the fire/flood/earthquake of 20XX... or were those in the files your kids accidentally tossed when you told them to clean the garage... If the accounts now total over $250k combined, I'd start with the 'Final' 5500-EZ; and "as many" previous years as you have "sufficient" records for. The IRS correction program (not the DOL's DFVCP) caps the penalty at $1500 per plan. [Although I'm perplexed by your statement that the 401(k) PLAN had profit sharing and money purchase Keough accounts. Yes, previously two plans were needed to get to 25%, but they could have been merged under one document anytime after 2001(?). The monies can be in multiple trust accounts and still be part of one plan, so I don't know if you still have two plans to file for or not.]

The 415 limit can cause this too.

Yeah there is no prescribed timeframe in the Section 125 cafeteria plan rules for employees to make the election change request upon experiencing one of the permitted election change events. As a practical matter, virtually all cafeteria plans set this outer deadline at 30 days from the date of the event. The cafeteria plan document or summary materials should confirm. You need to stick to that outer limit to avoid potentially losing the safe harbor from constructive receipt. More details here: 2022 Newfront Section 125 Cafeteria Plans Guide A couple other items of note: Employees who are on parental leave (or their spouse is on parental leave) generally cannot incur reimbursable expenses under the dependent care FSA. Employees’ dependent care expenses are eligible for reimbursement under the dependent care FSA only if the expenses are “employment-related,” which means they enable the employee and spouse to be gainfully employed. More details here: https://www.newfront.com/blog/dependent-care-fsa-during-maternity-leave-2 The cafeteria plan rules with respect to the dependent care FSA rules are the most loose on what events will permit an election change. I read those rules as permitting employees the ability to change their dependent care FSA election upon virtually any change in their daycare situation. More details here (see slide 16): 2022 Newfront Section 125 Permitted Election Change Event Chart

I thought you HAD to test the union EEs separately.