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We see this done, essentially, when the two plans have maintained a combined trust for years. The assets "transfer" to the DC plan in bookkeeping form on an effective date.

I just gazed at Code 4980, didn't see anything describing how the transfer "must" occur other than not passing through the employer's hands first.

At the risk of repeating myself, don't forget to re-read IRC 4980 to see the conditions that permit such a transfer.

I don't think so, but if the reason for doing so is to keep those assets invested, note that gains and losses in that escrow account will increase/decrease the portion that gets allocated each year - so volatility and lack of liquidity could be issues.

It is a taxable fringe benefit and included in the 3401(a) compensation definition regardless of the employer's discretionary decision on whether to withhold unless the plan definition also has the permitted fringe benefit exclusions. The 401k Answer Book has a nice table that shows the various 414s safe harbor compensation definitions, inclusions, exclusions and optional exclusions. Other publications likely have similar,

A rule of thumb is if it appears on the employee's pay stub, it is 3401(a) compensation. (This rule of thumb is not 100% reliable since it is subject to the reporting accuracy of the payroll provider.) You are correct that vehicle fringe benefits are not listed among the 20 subparagraphs under section 3401(a). The IRS Fringe Benefit Guide Publication 5137 (attached) is a resource for wading through the swamp of the various fringe benefits. It includes Employer-Provided Vehicles on page 36. And you are correct that Group-Term Life Insurance (page 58) is treated differently. (By the way, the GTL has some quirks related to dependents, retirees and terminated employees that many recordkeepers are no aware of.) Given your description of this employer's vehicle policy, I would say the $500 per month is included in 3401(a) wages. If this employer has a plan that uses 3401(a) wages as plan compensation, then the employer would need to explicitly exclude this vehicle benefit and any other fringe benefit that it does not want to use for calculating plan benefits. Fringe Benefit Guide Publication 5137.pdf

I would think that you're subject to the -11g rules, where the increase in benefits must be nondiscriminatory. And another result of the amendment being adopted more than 2.5 months after year end being that you're not going to be able to reflect the benefit increase in the valuation. I just had something like this, where I grumbled, why wasn't the benefit change just made part of the original document signed last month? Because I think then it would have been okay, because a retro-adopted plan is deemed signed on 12/31. Willing to be wrong, though....

When evaluating whether there are related employers, keep in mind the reduced ownership threshold for controlled groups under 415(h) and the special rule for 403(b) plans under 415(k)(4).

And here’s the important idea: Don’t be a do-it-yourselfer. Find a good service provider to guide you in doing things correctly and efficiently and effectively.

Unrelated employers? Basically the annual additions limit rules will come into play.

A few points: 1. The rule that automatically creates a controlled group between spouses' otherwise-independent companies in a community property state is going away starting in 2024, thanks to section 315 of the SECURE 2.0 Act. 2. There is nothing that says companies in a controlled group can't have separate plans, the plans just have to be tested together. This is only an issue if either of your companies have any employees. 2a. It's possible that the plan documents you are using may automatically adopt the plan on behalf of all controlled group members, but that is an issue with the document, not with any law or regulation. If that's not what you want to happen, find a new document provider. 3. You can't terminate a 401(k) plan while maintaining another defined contribution plan (such as a 401(k) plan) within the same controlled group. This is known as the successor plan rule and is designed to prevent people from skirting the age 59½ distribution restriction on 401(k) plans. You will have to merge the plans instead, which is a little different from a standard trustee-to-trustee rollover that you might be thinking of. My suggestion at this point: pick one of your two existing plans to be the surviving plan, and merge the other plan into it. Execute a participating employer agreement (or joinder agreement, there are other names for it as well) to adopt the plan on behalf of all three employers (your company, your wife's company, and the joint venture). Optionally re-name the plan, but that is largely an aesthetic choice. One more thing that just came to mind: Have you been filing Form 5500-EZ? If not, is it because the assets in each plan are below $250,000? If the assets were above $250,000 combined you were likely required to file.

Wow, what a needless over complicated provision for such a small amount. Couldn't they just say - If you have an emergency you can take up to $1,000. If you do so you can not do so again from the same plan for 3 years. All the extra stuff is just screaming to mess something up somewhere.

What is an emergency personal expense distribution? This is a payout to meet unforeseeable or immediate financial needs for necessary personal or family emergency expenses. You may take this only once each year. You may take up to $1,000 [2024] (counting all plans). But you must leave at least $1,000 in your account. You may recontribute to the plan the amount you receive within three years after you receive it. After you get an emergency personal expense distribution, you may not get another in the next three years until you repay into the plan the payout you received, or your later elective deferrals under the plan are at least as much as the payout you received. Allowing for a need to write in plain language, is that an accurate explanation?

I think so - I read it as though the participant has to "leave 1,000 behind remaining in the plan"