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There is a good chance you got it. Old ESOPs can what is known as the have/have not problem. There are no new shares to allocate to the new employees so getting the terminated employees to take a distribution is a source. They might not even be reallocating all the shares in one year but setting it up so the shares are allocated to employees over a number of years. But ESOP companies tend to not like only long tenured employees having shares and the new employees don't. It can cause work place friction. Joe who has worked at the company for a long time keeps talking about how much his stock is worth and how get it is being an owner employee. Bob keeps seeing he is only get a few shares every year and thinks I will never do as well as Joe why should I care about the ESOP?? While this appears to not be an issue currently many ESOP companies like to get the shares out of the hands of their former employees if the stock price is going up. Why compensate a former employee with a higher stock price? Obviously the point is to compensate the current employees. So getting shares out of the terms and to current employees is good human resources thinking in most cases. You want to pay people for current work not past work. It is a win for you since you want out with the price going down. So win/win at this point. They are most likely limiting you to 40% becasue they don't think they have the cash to fully cash out the terms. Hope that helps.

It's called THEIRS. Congrats on retiring. I went through the same process but never got the love note.

NO! See Q 33a EFAST2 FAQ

Report the attorney to the proper authorities, totally illegal. Unbelievable.

Ok, so after 40+ years in the TPA world I retired at the end of 2021. In 2022 I terminated my small solo-k which I sponsored as a sole prop for some side income, plan was alway under $250k. I rolled it to an IRA and in January 2023 I filed a 2022 EZ marked as both the first, and the final return. Today I get a letter 1072C from the IRS telling me that my EIN is XX-XXXXXXX and that I should always use this number in filing the EZ. Well, duh! Yes, I know that’s my EIN, that’s why I put it on the EZ form in the first place. I checked my copy, the number on the EZ is correct and matches the number IRS states in the letter as well as on the original EIN assignment letter I received years ago. The letter doesn’t say I have to do anything, and it acknowledges receipt of the 2022 EZ filing. So Whiskey Tango Foxtrot? I don’t recall any of my clients over the years getting a letter from the Service like this. anyway, just thought I’d put this out there in case some of you start getting client calls about such a letter. I think IRS has a special department to create correspondence designed to waste TPAs’ time. Definitely helps remind me why I was ready to retire (and enjoying it immensely, especially most days where there’s no IRS envelope in my mailbox!)

The LTPT rules only apply to a plan with a 401(k) feature in 2024, and to a 401(k) or 403(b) starting in 2025.

Just as an update, and maybe a laugh. Anyway, we did documents for the termination of the Plan, using proper dates, etc... Would you believe the attorney revised the dates in materials to use the retroactive date that he was recommending. Luckily, it is well documented that we used proper time frames and such, so we easily put the kebosh on that! Client understands the "reality of the situation" so termination is being done properly as we processed. For "venting", doesn't it just roast your butt when some "outside expert" comes in and acts like they know it all, and then they actually modify the work that you did to reflect their error, and then send to the Client as if we made the changes? As I said earlier, I don't claim to know everything, but one thing I would never do is modify someone else's work WITHOUT DISCUSSION OR EVEN NOTIFICATION, and then try to pass it off as the work of that other person. We wouldn't have even known if the Client didn't send us a copy of what the attorney changed and sent to the Client asking us if this was correct! We, of course, were not even copied on that mailing. It just went to the Client under a short cover letter that said "use this version". I don't know, but that seems that someone has a bit too much chutzpah, and at best, is not someone we should ever work with again since they change our work and send to the client as if we agree with the change! I can only say I would never do something like that. Isn't that illegal?

If you are not yet the TPA then I don't think that Precept 10 would apply in this case. I'm not going to just provide information to another actuary because they ask for it unless either 1) they have a signed service with the other actuary, or 2) the client asks me to share the information directly (in which case I would simply send it to the client and they can share as they see fit).

Maybe the IRS's AI is too much A and not enough I.

Schedule E income is never earned income for retirement plan contributions. It’s rental or royalty income and does not qualify. No extenuating circumstances.

https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/faqs/efast2-credentials#q17

Maybe. The 3(16) Administrator may be engaged for only some of the general Plan Administrator duties, as long as they are spelled out. We had a 3(16) product where we would do SOME of the 3(16) duties and not be responsible for the others. We added plan language that "OUR FIRM will be considered a 3(16) Plan Administrator as outlined in attached 'NAME OF ADDENDUM'." In the Addendum, it outlined the the items we were responsible for such as signing the 5500; approving distributions, loans and hardships; and a few other things. It was noted that our firm was ONLY responsible for the items on the list and the Plan Sponsor, acting as Plan Administrator would be responsible for other duties of PA (or delegating those duties to another 3(16) administrator) such as distributing required notices, tracking eligibility, etc.