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Here literally is the sanitized notice that was sent out to everyone who received the NOIT. The language was adapted from the letter received from the PBGC. We added the second paragraph because individuals had made elections for their form of payment to be made as a result of the plan termination. Notice of Withdrawal of the Plan Termination of the Retirement Plan The Corporation has withdrawn the plan termination of the Retirement Plan. The Plan is an on-going plan. The Plan did not terminate as of the proposed termination date stated in the Notice of Intent to Terminate that was distributed when the process began. You will be notified in advance of any further effort to terminate the Plan. Under 29 CFR section 4041.28(b), the plan administrator may not make any distributions of assets unless a participant has a distributable event such as retirement, death, disability or other separation from employment, and is eligible to commence benefit payments.

The changes in the draft instructions for the 2023 5500-SF say: IV. Changes to 2023 Instructions for Form 5500-SF Short Form Annual Return/Report of Employee Benefit Plan 1. Instructions for Form 5500-SF, “General Instructions,” “Who May File Form 5500-SF,” numbered paragraph 1 is revised to add two new sentences at the end to read as follows. 1. The plan (a) covered fewer than 100 participants at the beginning of the plan year 2023, or (b) under 29 CFR 2520.103-1(d) was eligible to and filed as a small plan for plan year 2022 and did not cover more than 120 participants at the beginning of plan year 2023 (see instructions for line 5 on counting the number of participants). To determine the number of participants covered by defined benefit pension plans and welfare plans, use the number described on Form 5500-SF, line 5a. Defined contribution pension plans use the number described on the Form 5500-SF, line 5c(1), except use the number described on line 5c(2) for defined contribution pension plans that check the “first return/report” box on Part I, line B; Similar wording appears in the Form 5500 instructions. Short version, if you check the box that says this is the first filing, the count to determine if the plan is a small plan or a large plan is based on the end of year count that is reported on line 5c(2).

I think Lou is correct. The regs define the employer as the sponsor and any other entity required to be aggregated under the CG and ASG rules, so if you are a 5%+ owner of any entity in the group you are a 5% owner and an HCE. Otherwise, you could have 21 equal partners owning less than 5% of the partnership, but 100% of their own participating S-corp PCs, then pay themselves W2 under the HCE comp limit so no one would be an HCE. Then they could adopt a rich plan or plans for themselves and exclude anyone else because there would be no HCEs. But if Lou and I are not correct, I call dibs on the design in my second paragraph!

They can be - once they hit their year of service on 3/14/2022 they have six months to enter the plan so any DOP before 9/14/22 would be enough for you to be allowed to disaggregate them. But if you need them in the test, keep them in there at the 7.5% of 3,000

Not to speak for Jakyasar, but that was exceedingly helpful Paul.

Our firm has a specialty niche in this area. We have over 50 variable plan clients in various market segments. I sent you a PM if you would like more information.

I just had a plan that went through the entire plan termination process with the PBGC up to the point where annuities were purchased for all terminated participants and the plan was negotiating the purchase of annuities for the remaining actives. All filings were made timely. A week before the final PBGC filing was due, the company decided that it could not afford the contribution needed to complete the annuity purchases. The PBGC said as long as no distributions were made that relied on the termination as the distributable event and everyone who was sent an NOIT was given a notice was called off, the PBGC would acknowledge the withdrawal of the termination and the plan is back to business as usual. The plan was frozen so everyone already was fully vested, and we recommended an amendment to withdraw the termination to complete the documentation. Frankly, it was surprisingly simple.

Did you try testing again? $900 seems like a low hurdle... Do you have room to shift? Is it current year testing and an additional QNEC would be simpler to manage? Do you have excluded compensation items and a safe harbor definition or gross 415 compensation will lower the HCE rate? Did you use statutory exclusions and check the alternate entry dates allowable?

Hmm. Did you see Bri's note above mine? Is this ineligible match due to ADP failure, or the ACP refund itself? Side note: there would NOT be a rollover from the IRA back tot he plan. You/they would inform the IRA holder that $x was an inadmissible contribution to the IRA and it should be removed from the account and transferred back (with earnings) to the plan trust. A rollover would generate a 1099. There should NOT be a 1099 for this reversal. And this is why HCEs are last in having their accounts distributed in a plan term. Gotta wait for the testing to be done. Or risk having to go through these shenanigans...

Not terminating and unfreezing are two different actions. There should have been a resolution adopted to terminate the plan, so now a resolution to rescind the termination should be adopted. If the intent is to also unfreeze the plan then that should also be stated in the resolution - and if unfreezing applies to participation and benefits or just benefits. As you noted, that will require an amendment. If there was a plan amendment for the termination that made everyone 100% vested then I doubt if you can go back to 40% (unless specifically contingent upon plan termination) - but you can definitely go back to the vesting schedule for future accruals. If everyone was simply made 100% under plan terms pursuant to plan termination and the plan does not terminate, then maybe that is cause to revert to the vesting schedule. Was there an event or expectation thereof that gave rise to terminating the plan after only three years (potential red flag) that either didn't occur or was otherwise accommodated? Doesn't matter at this point but maybe an ongoing situation to monitor?