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To be honest, the reason these rules exist is because a bunch of doctors figured out they could form two corporations - one employs all of the doctors with Rolls Royce benefits, and one for the staff, with no benefits. Same ownership, abusive no doubt. Granted, many "serial" entrepreneurs may have multiple otherwise unrelated business, but the "potential" for abuse still exists. I have seen many companies have a "shared resources" entity providing management to a variety of other entities in different businesses, but the same ownership.... It is what it is....

One of today's items in the Benefits Link newsletter had a write-up on hardship distribution self-certification. The following is an excerpt. I don't read Section 312 of SECURE 2.0 as containing any such restriction. What am I missing, if anything? Employers may now rely on an employee self-certification that they have experienced a hardship and that the employee has no other funds available to satisfy the hardship. Self-certification is only available for the first hardship request during a plan year. If the participant requests more than two hardship distributions in one year then the employer is required to have physical proof of the hardship.

What about the exception for disability?

We see this happen frequently where participants switch from union to non-union and vice-versa. The only hiccup it to make sure that the loan payment is being remitted to the recordkeeper and account/contract number that belongs to the non-union plan. The loan payment will also need to be edited from the payroll report from the union plan to make sure the loan payment is not remitted to that plan.

Excellent article about "Industry Concerns re Roth Catch-ups" in June 23 PlanSponsor. The "industry groups" are asking for Congressional action on this but our specialists are indicating that, since this is a revenue issue for Congress, they (industry groups) may not get any delay. We (FuturePlan 401(k) and 403(b)) also use Relius. I know there is a comprehensive amendment (for SECURE 2.0 issues) coming but do not have a date. The mechanics involved in administering this provision do involve more than the language in the plan document. There are also payroll concerns, etc. Not very specific but hope this helps! Patricia Neal Jensen, JD,VP 403(b) SME FuturePlan

In the absence of specific language to the contrary, based on the information given, I'd say it should be allowed.

The Labor department’s Voluntary Fiduciary Correction Program’s § 5 (General Rules for Acceptable Corrections) includes this: “The fiduciary, plan sponsor[,] or other Plan Official, shall pay the costs of correction, which may not be paid from plan assets.” § 5(c)(1). “[T]he plan may not pay any costs associated with recalculating participant account balances to take into account the new valuation. There would be no need for these additional calculations . . . if [the fiduciary had not breached its responsibility]. Therefore, the cost of recalculating the plan participants’ account balances is not a reasonable plan expense, but is part of the costs of correction.” § 5(c)(3). “Any fees paid to such representative for services relating to the preparation and submission of the [VFC] application may not be paid from plan assets.” § 6(b). https://www.govinfo.gov/content/pkg/FR-2006-04-19/pdf/06-3674.pdf Even if no fiduciary uses the VFC Program, a fiduciary might, unless its lawyer advises differently, presume the Program’s conditions follow an Employee Benefits Security Administration general interpretation that a plan ought not to be burdened by an expense that would not have been incurred had a fiduciary not breached its responsibility to the plan. Such an interpretation might be logically consistent with ERISA § 409(a): “Any person who is a fiduciary with respect to a plan who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries by this title [I] shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, . . . , and shall be subject to such other equitable or remedial relief as the court may deem appropriate[.]” The circumstances and reasoning might be different if there was no fiduciary breach.

Next time draft it to say the plans are merged as of the stated date and the trustees shall transfer the assets as soon as administratively feasible. That's what we always do. Very important to keep it general, especially if the merger involves liquidation and reinvestment of cash.