I have a dentist with a profit sharing plan who will be terminating the plan in the next year.

He will not be making a contribution for 2012.

I had him execute a SIMPLE plan and distribute the required notices by October 1, 2012. He will be making a 2% non elective contribution for him and two emplolyees for 2012. He is self empllyed so will me making a salary deferral contribution for himself for 20112 in 2013 before he files his taxes.

Does this all sound correct to do ?

THank you!

ABC Corporation has existed for several years and does not maintain a retirement plan. ABC became part of a controlled group with XYZ Corporation on October 1, 2011. XYZ has maintained a calendar year plan for many years.

ABC will adopt the XYZ plan effective January 1, 2013 (the end of the transition period).

May XYZ consider October 1, 2011, the hire date for all ABC employees and NOT count prior service with ABC for purposes of eligibility and vesting?

It seems this should be acceptable, but I can't quite find an affirmative answer.

Thanks for any insights.

We have client who contributed and deducted on tax return approx. $10,000 more than 404 limit. Ideas for correcting?

Are we suppose to report the actual amount paid for health insurance or the amount deducted?

We are paid biweekly and because of this, the amount deducted is just sligthly difference from the amount paid.

In most cases it's off by 8 cents.

We have a plan that is union only plan. The plan makes a QNEC contribution to its members/employees. The plan is currently not passing the ADP test. If I bring test the entire QNEC for both HCEs & NHCEs, the plan still does not pass. If I test the QNEC for NHCEs only it will pass.

Is this possible? Since it is a union plan, it is not subject to coverage or other 401(a)(4) testing.

Thanks!

I have a plan the has mutliple sources. The elective deferral and match sources have a 1 month wait entering on the first day of the month following. The safe harbor and profit sharing sources have a one year wait and enter on the first day of the month following. Here is a quick example. Ptp is hired on 7/15/2011. He would enter the plan (elective deferral and match source) on 9/1/2011. Presuming he completes his YOS, he would enter the SH and NEC portions of the plan on 8/1/2012.

The plan also calls for compensation while a participant in each specific source. Based on my example above of the 2012 calendar year plan year, the comp for the elective deferral and match source would be for the entire 2012 plan year. The compensation for the SH and NEC portions of the plan would be from 8/1/2012 -- 12/31/2012. Now for the question:

When performing the gateway testing, I known that you can use compensation while a participant to perform the 1/3 of plan comp test or the 5% of 415 test. My question is am I permitted to use compensation while a participant in the plan as a whole or can I use comp while a participant for the portion of the plan year in which the participant is eligible for the SH and NEC portions of the plan? My understanding has been that the compensation for the gateway testing can be for the SH and NEC portions of the plan, but I am having trouble confirming it.

Next, we recently upgraded versions of Relius to 17.0. My recollection of version 16 and prior was that you could define comp for gateway while a participant, but I can no longer find that option in the newly designed plan specs. if anyone knows where it is, I would greatly appreciate being told where it is.

Thanks in advance.

I have a client who is simply wanting to encourage his employees to save. I have not had such a creature cross my path too often. The only two HCE's in his company make well over the comp limit, so their ADP will be in the 6.86% range. He wants to encourage people to defer 10%. Because I am afraid even a rich match won't make it an automatic ADP pass, I am suggesting he use the basic SH match to start with. If he adds a crazy non SH match formula like 0% up to 5%, 100% for 5% to 7% and 50% for 7% to 10%, does that blow up the ACP safe harbor for the basic match portion and I have to test the whole match or do I just need to test the non SH match?

I think I would have a good chance of passing just the non SH match if he can get some people to defer 10% because he and the other HCE will only get a limited portion of that extra because their deferrals cap at 6.86%. If I have to test all matching dollars together, though, it may not go as well.

Due to glitch in shifting over to new payroll system / software, a relatively small division had their 401(k) deferral missed for a single pay period. The employer realized the mistake right away and informed all participants of the problem and that they intended to simply double up on the 401(k) deductions the next pay period so people should anticipate having double taken out from pay the next time and so hold on to the extra pay now.

Anybody been through a similar issue. Is this sort of self-correction possible or would the IRS say they clearly needed to correct by treating the pay period as a missed contribution with the company kicking in 50% of the missed amount?

How would you expect the plan's auditors to react to this corrective action if the overall amount was small relative to the overall plan amounts?

I have an old profit sharing plan ( sole proprietor ) for a physician who left private practice several years ago.

Prototype document.

There is still one employee in the plan.

WE want to close it out and rollover to an IRA for him ( and this is also what the employee wants to do )

Other than sending the tax notices and distribution forms to each of them and doing the distribution to close out the accounts is there anything else that needs to be done ( plan amendments, notices to anyone, etc ) ? Do they need a spousal waiver for a profit sharing rollover ?

I know a final 5500 will be needed.

Just wondering what else I need to do to avoid any IRS/DOL problems down the road.

Many thanks !

the Grinch is reposting the Christmas Song Quiz.

130 pictures to identify the song.

the song list is on the second page on the excel file.

simply type in the number of the song.

the first song is already answered.

the individual who has created most of these has actually increased the number to 150, but then also increased the song list. his website is indicated on the excel sheet. maybe someday I will redo this puzzle to include the additional 20. He did say it was ok to post these.

christmas_puzzles__130_to_solve.xls

Four employees eligible for a profit sharing allocation. Two are older (55-60) co-owners making over compensation maximum. One is 45 year old employee. One is a 35 year old employee who recently (this year) became an HCE.

Owners want max (50K) and level percentage for other two employees. This worked in prior years a both were NHCEs. Now with the youngest employee as an HCE, can't pass testing.

Is there a way to solve this while still keeping it just a cross-tested profit sharing contribution?

Or is the only alternative to add a cash or deferred option?

Or is there another way?

Thanks.

This client of mine is a 403(b)7 client - we are the single provider. Are there any special provisions regarding fee disclosure that I need to be aware of for 403(b)7 plans that is covered under either 408(b)2 or participant paid fee disclosure?

Company A has two retirement plans 1) traditional 401(k) Plan (PYE 9/30) and 2) Prevailing Wage Plan (PYE 12/31). Both Non-Union Plans. Some or all of the employees are in both plans.

Plan 1 excludes compensation received from the Prevailing Wages. I know that I have to test the compensation, however since none of the HCEs receive Prevailing Wages, the group's ratio is 100%, whereas the NHCE group's ratio is 70.42%.

I have not aggregated the plans together, however should I for purposes of this test? If so, what PYE am I suing for the Prevailing wage plan - 12/31/2011?

I need to obtain benchmark data on earnings by retirement plans that do not allow participant direction of investment (all investment decisions have been made by the plan trustee) for years in the period of 2003 to current.

Are there online sources that you can direct me to?

We have a take over plan where the employer deposited the accrued match contribution twice into the participant accounts. The result is that the employer contribution into each participants account exceeds his required match contribution. What is the remedy for this situation?

Client came to us today, December 3rd and asked to be safe harbor for next year. Currently are a 401k plan with match.

Client says December 1 fell on a Saturday, so we should be able to give a notice today, December 3rd and satisfy the notice requirement.

Any thoughts?

Didn't want to insert this in the other active thread concerning Plan Administration, so started this new thread.

Specifically regarding their document system - we currently use the Relius Document system. Wondering if folks here have used the FT William Document system and if so, what is your experience?

We're giving some consideration to switching over from Relius to FT William for documents only - if anyone else has done this, what was your experience? Did the "mapping" project go reasonably smoothly? Is their amendment system/module user friendly and does it work well?

Do they have a good "Pension Library" similar to the Relius Pension Library, with specimen forms, amendments,etc.?

Any and all comments appreciated!

A 403(b) client is insisting that summer camp counselors are excluded from the plan because they exclude anyone who is scheduled to work less than 20 hours per week. They wan to apply this because of the months the people do not work.

Has anyone seen anything 'official' on just what this means? That is, may it be averaged over some period, or some other concept?

A daughter of a deceased employee called. She wants to claim her deceased mother's pension. She lives on the West Coast and we are located in Massachusetts. She is not the listed beneficiary. There is no beneficiary listed on this account.

The spouse is deceased. Our plan document states that we can pay to the spouse and in the case that the spouse is deceased then pay to the Estate. Their is no estate set up. It was closed about 6 years ago and she would have to hire an attorney for a percentage to set it up again to collect these funds under the estate. Is there less then 11K in the account.

Is there any way we can pay this to her directly?

Thanks.

Can 2 unrelated employers recognize both past and future service with each other for vesting purposes?

I know service is recognized within a Controlled Group and/or Affiliated Service Group. However, if there is a relationship or similar business interest between 2 separate unrelated tax-exempt organizations, could service after separating from one be recognized for vesting purposes if immediately go to work for the other?

Both Company A and B will be recognizing service for eligibility, contributions and vesting with each other, but what if an employee terminates company B and goes to work immediately for company A, if the employee is not fully vested in B, can they recognize service with A for vesting service credit and not create a forfeiture until such time as they may terminate from A or vice versa?