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They may have a right of first refusal of the stock (especially for the stock in B) or options both of which might create a controlled group.

I was paid 1/2 my fee and she parted ways with a snide email. She claimed that the "bigger" TPAs only charge a fee for the doc when the client is new and then every 5+/- ears when required by the IRS, not including an annual doc fee (duh). She is mistaking an interim IRS snap-on amendment for an amendment created due to her needing to change the plan as a result of hiring an employee and tweaking eligibility and vesting, which is charged in addition to the annual doc fee. She went on to say that they would allow her to file the form 5500 herself but if they did it that would only be $375. I'm guessing there is no testing performed or asset reconciliation. Bottom line is that she isn't comparing apples to apples with these fees. If I am mistaken then I am gouging my clients. The case is closed and her folder moved to the deleted clients folder. An eye opening situation that has prompted new agreements to all clients. A good way to clean out the book of business and maybe even slim down a little to better serve the clients who see value in my service. Thanks all for their insight. Always learning, always welcoming advice.

Is $2,948.26 the monthly amount he would have received if the 5-year C&L annuity started on his required beginning date, and is the $43,342.26 single sum simply the make-up annuity payments (with interest on the retro payments from required beginning date to the annuity commencement date)? (Since you didn't say, when was this person's required beginning date?) If so....the deemed RMD (subject to excess accumulation excise tax in each year from the year containing the required beginning date until 2022) would be 9-months of payments for the year containing his required beginning date, and, assuming the required beginning date was not 4/1/22, it would be 12-months' worth of payments for each subsequent year until the end of 2022. The RMD for 2023 would be equal to the 12 months of the annuity payments for 2023. Since the lump sum is to make up for annuity payments that were supposed to have been received from required beginning date until the benefit commencement date and that would not have been eligible for rollover in the first place, none of that lump sum amount would be eligible for rollover.

We are still reviewing this to determine whether we want to offer it to our clients. Most of our clients use our outsourcing services where we collect an review the necessary documentation to determine if the need exists - so whether it is implemented or not, it won't have must impact on our clients - except for the occasional gripe from a participant who complains (but - they are generally the one who actually don't meet the criteria for a distribution.) Our concerns, as have been mentioned, are the "actual knowledge to the contrary" provision, and whether an employer's knowledge is imputed to us, as their agent under our outsourcing; the potential for abuse (and if/when a serial requester can be determined to be abusive and denied); why? I mean the point of a retirement plan is to provide financial resources for retirement - and now we are basically going to allow participants to turn their balance into a Christmas Club account? Leakage is an issue, and this may exacerbate it. Now, that said, my ops team that has to review and process these requests are all in on implementing this. When speaking with clients, I always ask "do you trust your employees to be honest and not abuse the ability this provision gives them?" The reactions are uniformly priceless and in the negative.....

https://www.law.cornell.edu/cfr/text/26/54.4980F-1 There is an M&A special timing, but still 15 days advance. If only affecting an early retirement subsidy, then you have 30 days after, but that's not your situation. Maybe 204(h) wasn't needed and everyone is just terminated, but I want counsel to opine on that as Lou recommended.

The root of this service model is drawing the fine line between a recordkeeper following a set of agreed-upon procedures authorized by the Plan Administrator versus the recordkeeper exercising any level of judgement on a participant's benefits or rights under the plan. Whether or not this line is crossed has been the focus of litigation over who is liable for the consequences of an operational error (and whose E&O insurance policy is going to pay.) The lines get blurred further when the PA is a committee that has not delegated any fiduciary responsibility to an internal benefits department, and the benefits department is the group with weekly or even daily interaction with the recordkeeper. The lines get blurred even further when the benefits department hires a TPA that is independent of the recordkeeper and the TPA's service agreement includes a review and sign-off on a transaction. (This happens most often when there is a determination of vesting that is needed to compute the amount payable, but can include a review of a hardship withdrawal, disability distribution or death benefit.) Despite all of this, the PAs and the related service providers in the industry is doing remarkably well in administering a vast number of plans covering a large part of the population. Shall we say good service contracts make for good relationships?

Due to security issues, I would be prevented from uploading information even if identifying information was redacted. But I can type in the information: Of the upper right side of the letter, it reads: Notice CP216F Notice Date July 3, 2003 Employer ID ##-####### Tax Period October 31, 2022 Form 5500/8955-SSA Plan Number 001 To contact us Phone 877-829-5500 Under the client name & Address, it reads We approved your request for an extension of time to file your return File your return by AUG. 15, 2023 The 5558 was filed with the Tax Period 12/31/2022 and requesting the extension to 10/15/2023. We have been instructing clients to call the IRS. When they have, the IRS corrects the information while on the phone and advises the that a new corrected letter is being issued and mailed to them.

It is interesting that the ftwilliam form requires the plan administrator to approve the form. Before self-certification was available, some big recordkeepers built procedures to process "routine" hardship withdrawals as a service without requiring a sign-off by the Plan Administrator. The recordkeeper set parameters for the types of hardship they would process and get an authorization from the Plan Administrator to make withdrawals for transactions presented within those parameters. Transactions presented that were not within the parameters were sent to the PA for review and authorization. Typically, the participant would complete, sign and send to the recordkeeper a hardship withdrawal form and documentation specified from a list of acceptable documentation. The recordkeeper would review it and if it was in good order, process the the withdrawal. I believe that big recordkeepers would like to parameters to include self-certified hardship withdrawal requests as long as the Plan Administrator will extend the PA's authorization to cover those requests. I also believe that system modifications to accommodate self-certification currently has a lower priority than the other system modifications needed to implement SECURE 2.0 features effective January 1, 2024.

Hi Peter - I did a quick internet search, and this was the first item that came up: https://hunterbenefits.com/wp-content/uploads/2023/03/Hardship-Self-Certification-Form-1.pdf I expect there may be others...

M&A is not my specialty but I think you'll want ERISA counsel to weigh on whether the amendment assigning Plan from Client to Parent is valid without the 204(h) Notice as it clearly will reduce future accruals of the employees in Client since they will be no longer be getting credits under the Plan since the Plan is transferred to Parent and the employees of Client will no longer be employees of Parent's controlled group. There may be some exceptions in M&A that I'm not familiar with though.

Agree with CBZ and that you have a multiple employer 401(k) plan issue you need to resolve - not just filing(s) but making sure each company's component plans satisfy coverage and nondiscrimination separately.

The spouse should seek some professional help for distribution and for tax-planning. There likely is more than one alternative available to the spouse depending upon the spouse's age, the spouse's age relative to the participant's age, whether the spouse also is a participant in the plan, whether there are other non-spouse beneficiaries and other similar scenarios.

To comply with ERISA 404(c), participants must have an opportunity to exercise control over the investment of their accounts. Failure to offer that opportunity does not result in disqualification since it is not part of the tax code, but it could result in loss of relief of co-fiduciary liability for the plan's other fiduciaries. If the plan document says that participants will be given the right to direct the investments in their account, then failure to follow the plan document is an operational failure that is potentially disqualifying. The right to direct investments is considered a benefit, right or feature that must be available to participants on a nondiscriminatory basis. If HCEs have the right to direct their investments but NHCEs don't, you could have a 401(a)(4) violation, which is disqualifying. That aside, what is a "catch up profit sharing contribution?" And when you say "It was requested for these funds to be deposited into specific accounts" - requested by whom, and what accounts? The plan doesn't have to let participants invest in anything under the sun; in fact, it would probably not be prudent to do so. The plan can restrict the participants' options to a menu of investment alternatives.