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If it was filed timely, an extension to 10/16/23 could be requested for a calendar year 2022 plan.

Depending on the amount of the desired loan, a bonus of that amount may not be feasible, but I've seen a lot of employers take that route if the amount is small. I've also seen employers actually loan the participant money instead. As to the amendment, I'm usually on the conservative end of the spectrum for these things, and you've gotten valuable input already. I absolutely would not recommend hiding it so that only this employee can take advantage of it - as Cuse said, just because you CAN do something doesn't necessarily mean you should - a lot depends on the size of the plan. If it is a small plan, perhaps notify employees in advance that this loan window will be open only for a couple of days? Most people won't take a loan anyway. I don't know the dynamics of the situation. Remember that if you modify the hardship withdrawal provisions to include non safe harbor reasons, you can't rely on self-certification for a withdrawal of other than the safe harbor reasons.

And amend to everyone in their own group going forward.

If the employee is really that important to the employer, give them a bonus, forget about the plan, and get everyone back to work?

with an 11g amendment - although you didn't say if this was just last year or ongoing for a number of prior years

If a 5558 was not filed by 7/31, your next option is to check if the corporate (or personal) tax return was put on extension, in which case the 5500 can be extended on that basis, but you'll need a copy.

I think the person's 415 limit (100% FAE or max $ actuarially increased) is determined without regard to the prior distribution, then once that is determined the person's applicable 415 limit is offset by the actuarial value of the prior distribution. I'm not an actuary, nor do I play one on TV, and also did not stay at a Holiday Inn Express last night - but I do work with a lot actuaries.

I was going to suggest as well, but figured it wasn't an option because it is an obvious one that wasn't even mentioned. Regarding non-safe harbor hardship, my thought was applying such criteria to loans, not withdrawals. So if someone has a (subjective) hardship where they can't get a distribution they could still get a loan. This would likely minimize usage and give the employer/plan administrator some discretion - but with that, added responsibility.

Agreed, thank you all for your insight and this disucssion.

So the plan was terminated 10/17/2022. When were the assets distributed? If not until 2023, then the 2022 year is still a full year. But that would still mean 7/31/2023 would be the deadline for filing the extension.

Even textualists say an interpreter might find meaning in how a word is used in related contexts. There are many statutes and rules in the tax law of retirement plans that use the word “employee” despite a context that suggests the use includes a participant who is a former employee. To pick only one example (and we could find many), the proposed rule to interpret and implement Internal Revenue Code § 401(a)(9) has 1,349 uses of the word “employee” (and only 41 uses of the word “participant”). Proposed § 1.401(a)(9)–2(a) states: “Distributions commencing during an employee’s lifetime In order to satisfy section 401(a)(9)(A), the entire interest of each employee must be distributed to the employee not later than the required beginning date, or must be distributed, beginning not later than the required beginning date, over the life of the employee or the joint lives of the employee and a designated beneficiary or over a period not extending beyond the life expectancy of the employee or the joint life and last survivor expectancy of the employee and the designated beneficiary.” https://www.govinfo.gov/content/pkg/FR-2022-02-24/pdf/2022-02522.pdf Does the Internal Revenue Service, acting under the Secretary of the Treasury’s delegation, intend to limit that minimum-distribution rule to a participant who is still an employee? Likewise, the statute the proposed rule would interpret and implement reads: “Required distributions.— (A) In general.— A trust shall not constitute a qualified trust under this subsection unless the plan provides that the entire interest of each employee— (i) will be distributed to such employee not later than the required beginning date, or (ii) will be distributed, beginning not later than the required beginning date, in accordance with regulations, over the life of such employee or over the lives of such employee and a designated beneficiary (or over a period not extending beyond the life expectancy of such employee or the life expectancy of such employee and a designated beneficiary). I.R.C. (26 U.S.C.) § 401(a)(9)(A) http://uscode.house.gov/view.xhtml?req=(title:26%20section:401%20edition:prelim)%20OR%20(granuleid:USC-prelim-title26-section401)&f=treesort&edition=prelim&num=0&jumpTo=true Does Congress intend to limit that minimum-distribution rule to a participant who is still an employee? Does Congress intend to impose a too-early tax on a participant who submitted her claim within § 414(w)’s time but not until after her severance from employment?

The son of the owner is attributed the same ownership of the owner. If that’s over 5%, then the son is an HCE. If the son was not coded as an HCE and because of that miscoding, the plan passes, then try other testing options or provide the amounts needed to the true NHCE so it will pass, or do both.

Statutorily, could probably amend loans in and out in a vary narrow window, but I'd think about a better way to handle if at all possible. Technically, there would need to be an SMM for each amendment, which might create an HR issue. If you say no SMM is needed because, at the time required, no actual change to SPD language is in effect - I don't know if I'd want to argue that with DOL. I know it's an NHCE and the intentions are good, but doing such an amendment and (most likely) hiding it from everyone but the lone target just doesn't smell right. As gets said in this forum all the time, just because you can do something doesn't mean you should. I'm more concerned with the HR and overall employee relations issues that could come from this as opposed to any plan compliance problems - how come Johnny could get a loan last week/month/year but I can't? I've got a sob story too. Maybe allow loans for broader non safe harbor hardship reasons?

No. In order for spouse/dependents to get 36 months of COBRA from the date of Medicare entitlement, the employee must be entitled (enrolled) to Medicare before the qualifying event (termination). When the employee is entitled to Medicare prior to the qualifying event, the spouse and dependents are entitled to COBRA for the longer of: (a) 36 months from the date of entitlement to Medicare Part A; or (b) 18 months from the date of retirement. For example, if the employee turned 65 more than 18 months before termination, the spouse and dependents will be eligible for COBRA for up to 18 months from the date of termination, because that's longer than 36 months from the date of Medicare entitlement. Whereas if the employee is enrolled in Medicare on August 1 and then terminates employment on August 31, the spouse & dependents are eligible for 36 months of COBRA from the date of Medicare entitlement (i.e., 36 months from 8/1). The employee however is only eligible for 18 months of COBRA. See IRS Revenue Ruling 2004-22 (page 554)