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For all you folks who may be impacted, here's hoping you come through it with minimal effects. Best of luck!!

Don't think so, but also remember that neither spouse can be involved in the other's business for a control group to no longer exist. Sometimes, sponsors and/or their practitioners want there to be a CG and so create some cross-involvement to get there.

I've been wrestling with this as well, and we going down the same road - your wording is much more direct and succinct than mine was (I'm approaching a half-page, probably explaining way too much). I've been thinking about the plans with payroll bridges and things like that. The RK handles the initial notice, and then if the participant doesn't log in within 30 days they send a file to payroll somehow to turn on the deferrals at the automatic rate. While I agree that getting a tree-pulp piece of paper into someone's hands is a great way to try and circumvent getting AE'd, when it gets returned it somehow has to become an interruption to a process that is becoming increasingly computerized. For the ones where it's going back to the ER and they are making changes to payroll manually, this is a lot more workable.

Agree with Bill Presson. Only 501(c)(3) orgs can adopt a 403(b) plan. A payroll for a 403(b) plan would mean that the "employer paying the payroll" (sponsoring the plan) is 501(c)(3). And it is correct that a 403(b) and a 401(k) cannot be merged under current law.

If you hope for or fear tax and ERISA legislation nearing the end of the 118th Congress, watch in mid-December. Based on Congress’s continuing resolution many expect they will enact by September 30, the next end of appropriations would be December 20. That’s the Friday before Christmas Day. In the remaining session after 2024 elections, look for Congress to turn to the National Defense Authorization Act for fiscal year 2025, and to some effort to avoid or invoke a government shutdown. Those efforts might include an appropriations or budget-reconciliation bill, which could include law changes the Senate could not vote on under a regular-order procedure.

Yes

You can’t merge a 401k into a 403b. But I think that’s the least of the issues. seems like the guy is wanting to use a not for profit entity to pay the wages of the people that actually work for his for-profit business. I would have to imagine there are legal issues with that and I would avoid it. If you can insulate yourself by having his CPA and an ERISA atty drive the decisions, then you should be good.

I got my QPA way back in 1991. I did go back and get my QKA (I think there was an extra exam needed for it at the time).

In order to be a safe harbor definition of comp, it has to include 125 deferrals as well as 401(k) deferrals. Box 5 is grossed up for 401(k) deferrals but not for 125 deferrals.

Nah, I don't see the point to be honest.

I agree with @Bill Presson as far as credential is concerned, but I am not aware of a requirement to have the prior credential to take the exam. In other words, you can take the exam before you have the QKC designation, but you can't apply for QPA without having met QPC. I took the exams out of order before there was a QKC designation, but this was back in the hunter-gatherer days...

From the QPA credential guide: To obtain the QPA™ credential individuals must: Have earned the QKC credential Pass the QPA™ exam Agree to abide by the ARA Code of Professional Conduct Apply for the credential

Taken from the 5500-ez instruction: "You do not have to file Form 5500-EZ for the 2023 plan year for a one-participant plan if the total of the plan’s assets and the assets of all other one-participant plans maintained by the employer at the end of the 2023 plan year does not exceed $250,000, unless 2023 is the final plan year of the plan. For more information on final plan years, see Final Return, later." Why would you not start a traditional IRA or Roth IRA? If you aren't exceeding the limits for IRA's?

The applicable interest rate for 417(e)(3) is tied to the stability period containing the annuity starting date - not the termination date. So if the stability period is the calendar month, then the interest rate would change if the distribution is paid in July versus, say, August. However if the stability period is the calendar year, then the interest rate would not change until January. It's possible, although it seems unlikely to me, that the actual accrued benefit (not just the lump sum equivalent) could be affected by one day of re-employment. You'd have to look at the plan's benefit formula to see.

With Secure 2.0, the SIMPLE can end mid-year if replaced with a 401k SH Plan. If they added a DB after the change, would that still be a VCP issue? Seems like it was not addressed and would be a problem if the DB was added in 2024

I'm skeptical about the above statement. Based on my read of the original post, the plan should process his benefit with a BCD of 05/01/24. The one-day of compensated time on 05/18/24 has no bearing on the BCD or the amount of the benefit. Don't overthink it.

A company's contributions to a retirement plan can come from either it's current profits or retained earnings. However, the company's accountant should be consulted with respect to tax deductions, if they would be limited to current profits, or provide any lookback or carry forward opportunity. I know there used to be very limited lookback deductibility but maybe not any more. Contributions not currently deductible can be deducted in the next year but need to take care in not depositing non-deductible amounts in a current year. Contributions and deductions will also be limited by the 415 limits and eligible payroll. If he's an architect with few or no employees then a CBP would be PBGC-exempt and any DCP would have to be limited to 6% or eligible payroll employer contribution or be subject to a 31% of payroll combined deduction. In those instances, including a 401(k) provision adds opportunity for another $30k. I assume C-corp tax status and wanting to avoid the double taxation on paying out those retained earnings? There will eventually be tax again on those amounts when ultimately distributed from their final tax-deferred resting place, whether a qualified plan or subsequent rollover IRA.

I'm confused somewhat because you seem to be asking what "can" be done when all the relevant dates in your conundrum have passed. If paperwork for 5/1 commencement was timely sent, returned and benefits commenced, the one day of rehiring did not rise to the level requiring suspension of benefits (assume that is where you were going with the 40 hours). If he has not yet returned forms and commenced then does this matter? Maybe, but most likely not - you mention "rolling out" which is only available if if a lump sum is paid, and again, since we're in July, whether he retired/terminated 4/22 or 5/18 doesn't matter for a lump sum (unless it also affects the actual calculation of the benefit).