Leaderboard

As a control group all participating employers are deemed a single employer so I do not think a different formula for one or more employers works. Also, I think that any discretionary match must preclude the possibility that any HCE could get a higher rate of match compared to any like NHCE (i.e., one who defers the same percentage), which would prohibit participating employer(s) from having their separate discretionary matches unless such employer(s) have only NHCEs. If I'm wrong on any of this, I hope one of my esteemed and more knowledgeable colleagues with respect to this subject matter will set us straight.

Yes. To be clear, you file the form that is required for the reporting period. For a calendar year plan, if the plan only covered the owner during 1/1/22-12/31/22 it is a one participant plan and you are required to file on an EZ.

This may have changed recently to be more consistent, but my limited experience the last few years is that whether or not all the interim documents and amendments are needed seems to be up to the discretion of the assigned IRS agent for the VCP review. I have had some just take the updated document and run with it, and other who wanted the plan to adopt everything in between (EGTRRA, GUST, TEFRA etc). In those cases it was much more work to create and provide those intervening restatements.

If this is the case, then Equitable should be able to provide all (blank) documents and interim amendments since the original document that was adopted. Might be fees involved, but that's the least of the problems. The IRS is usually pretty reasonable on these one-person plans, (I once had an IRS auditor in one of these situations just make the client adopt a current document, and closed the audit!) but I'd also be prepared to prove compliance with incidental limits, etc. You could also try the pre-submission conference - see Section 10 in RP 2021-30. Might end up saving you and your client time and money. Good luck! "You never know where the wheel may go..."

You reference two years here, 2022 and 2023, but as far as 2022 goes, that ship has sailed. There is no opportunity to defer in a corporate setting other than through a paycheck.

Bill Presson, Paul I, and Dare Johnson, thank you for this helpful information.

Other BenefitsLink neighbors might help you reconstruct the many amendments and restatements the plan’s sponsor ought to have done over the past 37 years. Whichever person is evaluating whether to pursue corrections and by which means might want to evaluate whether the plan was administered according to implied provisions that would have met Internal Revenue Code § 401(a)’s conditions for treating the plan as tax-qualified. Also, if the accountant knew—or, in the exercise of the care his profession requires, ought to have known—that plan amendments were needed but not done, he might want his lawyer’s advice about the accountant’s professional-conduct responsibilities regarding tax returns and tax-information returns, and about liability exposures.

We are a CPA firm so we have coverage under the firm's policy. I would also recommend cyber insurance. TPAs have all the data hackers are looking for - names, SSNs and DOBs. It is only a matter of time until TPAs starting getting hacked.

By way of illustration, here is a list of coverage and exclusions from our policy. Coverage: Miscellaneous Professional Liability (typical errors & omissions) Information Security & Privacy Liability (protection of data and privacy) Personal Injury Liability (someone gets injured) Website Media Content Liability (information presented on website) Privacy Notification Costs (remediation if breach of data privacy) Regulatory Defense and Penalties (legal representation) PCI Fines, Expenses and Costs (more data protection) Consequential Reputational Loss (loss of business from hit to reputation) Electronic Crime Endorsement (electronic funds transfers) Fraudulent Instruction Coverage (fraudulent instruction by someone outside the firm) Telecommunications Fraud Endorsement (fraud by a third party using our telecommunications services) Exclusions: War and Terrorism Exclusion Endorsement War And Civil War Exclusion Generally, any willful act of fraud or collusion on our part is not covered, and any consequences of providing incorrect or incomplete information, or a failure to provide information is covered. As sign of the times, It is striking how much greater detail there is in more recent policies related to privacy of data and to fraudulent transactions. In addition to coverage amounts, the underwriting process is influenced by business structure, number of staff, professional credentials of staff, number of clients, scope of services, data security and gross revenue. If you are talking with people looking to enter the business, inform them on business structures that best avoid exposing their personal assets to the financial risks of the business, and emphasize that E&O insurance is like health insurance, auto insurance and life insurance - you hate to pay the premiums but you will be thankful you have the insurance if when you need it.

The smart ones do. I had malpractice coverage when I owned my own TPA from 1986-1998 and our trust company that I merged into did as well. Haven't been an owner since the mid 2000's but I'm pretty sure the firms I've worked with since then have the coverage as well.

ERISA-Bubs, you do not say how long the plan has allocated revenue sharing using a formula that is contrary to the 404(c) disclosure, nor do you indicate which method was approved by the plan administrator for use by the plan. If there is documentation of an approved method and the plan actually has been using that method, then you are dealing with a miscommunication in the disclosure. Correcting the disclosure and issuing a new disclosure may be sufficient. If there is documentation of an approved method and the plan actually has not been using that method, then there is an operational issue that could have accumulated over time to be more than only pennies per at least some participants. It should not be too onerous to so look at participants within the funds that paid the most revenue sharing to see if how much of an impact using the incorrect method had on those participants. If it does have an impact, then you can consider making whole the participants who were did not get the full benefit of the revenue sharing on their investments, plus a little more to bring them up to the level of other participants who improperly received revenue sharing amounts that they should not have received. Keep in mind that if you know there is a problem and you do something reasonable to correct it, you are will be better off in the eyes of a DOL or IRS agent than if you know there is a problem and you ignore it. If the issue truly is pennies per participant, a creative fix may be as simple as skewing some of the next revenue sharing allocations to in favor of those participants who had a shortfall.