Here is the plan specifics:

Full timers: Immediately Eligible, Daily Entry

Part Timers: 1000 Hours, Daily Entry

Plan Year: 2/1/11-1/31/12

Safe Harbor Plan: 1 YOS required to receive SH match

Here is my problem, I have 1 HCE that is in my disaggregated population (under 21/less 1-YOS). Hired 4/19/10. Termed 2/2/11.

The plan has an extremely large part time workforce. The ratio test is at 19.53%. We have confirmed all the information with the client and it appears to be accurate.

With a ratio that low, Average Benefits does not seem to be an option.

We typically run the ratio test on an Annual basis. We are looking into running it on a snapshop basis. Is this possible? What date would be "reasonable"?

Is there anything we should be concerned about? In past years, we have not had any HCEs in the under 21/less 1 YOS group.

Any thoughts?

Seems like the regulations produce a possibly unintended consequence, and I'd just like to see if I'm way off base on this.

A person starts a new business when he is 75. According to 1.401(a)(9)-2, Q&A-2©, this person wouldn't be a 5% owner, becasue he wasn't a 5% owner with respect to the plan year ending in the calendar year in which he attained age 70-1/2.

Under the prior regulations, there would have been a different result, and the RBD would have been April 1, 2013. But the (current) final regulations changed this - whether intentionally or unintentionally I don't know.

Does anyone disagree with this? It makes a difference, because if my reading is correct, then any distribution taken at this point would NOT qualify as an RMD, and would be an ERD and subject to 20% withholding.

I am studying for my ERPA and one of the topics I need to focus on is EPCRS programs. At some point, I came across a web page that summarized what types of defects can be corrected under SCP, VCP, AuditCAP, but I don't know where that site is.

Can anyone provide a link to a good website that will succintly identify what errors are eligible for each program?

I have passed ERPA SEE Part I and am studying for Part II (taking in January). I received something awhile ago about continuing ed - and I couldn't find the answer to my question:

Do I have any CE requirements BEFORE I pass Part II and have my ERPA designation?

Trying to determine the accrued benefit based on the following....

NRB = 2% average monthly comp per year of service up to 25 years

Accrual Method = Fractional accrual based on years of service

Average Monthly Comp = $3,000

10 years of service

NRD = 2032

I am calculating as follows: 2%x25yrsx$3,000=$1,500x.4=$600 monthly accrued benefit. (with the denominator being 25 years)

Is this correct, or should I be using 2%x25yrsx$3,000=$1,500x.33333=$500 monthly accrued (with the denominator being 30 years)

Hypothetical (real fact pattern changed to protect the innocent):

Employee is awarded restricted stock units that time vest in 2010. Upon vesting, out of negligence/ignorance/etc., the employer does not deliver the shares to the employee nor does it withhold and remit the applicable taxes or report the award at all on the employee's Form W-2 for 2010.

To correct this, does the employer just need to issue an amended Form W-2 and the employee just need to file an amended return for 2010 or is does this situation impose 409A penalties on the employee as well?

I think a strong argument can be made that this does not implicate 409A at all and it can be analyzed under the traditional concept of "constructive receipt" but I am interested in other thoughts.

401k small plan sponsor has just decided to terminate plan by end of year. Plan up to date on amendments but they no longer have a plan attorney. They will not be filing a DL. Is it acceptable to just create a plan resolution to terminate from a template?

We're putting together a determination letter filing for the Cycle B restatement of a cash balance plan for a new client, and the client cannot find any interim amendments for their original document. Do we need to go through VCP for non-amenders before we apply for the determination letter? Or do we file for the determination letter, and then have the reviewer assist us with the correction?

This seems like it should be an easy or simple question but I cannot seem to find any express discussion or guidance on this and so want to make sure I am not missing something. Company has a group health plan. Company is going to implement a wellness program. It is generally separate from the group health plan and will be available to all employees. It will reward individuals for achieving certain health status / factors (i.e., it is not a participation only program--you have to achieve a particular result or alternative standard). The plan generally complies with the five factor HIPAA nondiscrimination requirements--the reward involved is relatively small and there are alternative arrangements. Plan is to provide premium discounts or rebates for those in the group health plan and cash / card for those individuals achieving health status that are not in the group health plan (e.g., if covered by a spouse's plan, etc.).

Is there a problem with providing cash / rewards to those not in the group health plan since the cost of coverage for them is $0 and any amount would exceed 20% or is the 20% to be determined based on general cost of coverage for an employee / family under the plan if they were covered?

Thanks

Company with a 401(k) plan and a few hundred employees acquires a small company that maintains a Simple 401(k).

Is it true that the Simple 401(k) may not be maintained because the employer has more than 100 employees, and if so when must the Simple 401(k) arrangement be disbanded? (Is this the same timing as the qualified plan rules?)

Facts:

1) Participant born 7/2/1950

2) Terminated employment in 2007 and rolled over $100,000 into an IRA

3) In 2009 cashed in the IRA.

Question:

Would the age 55 exception from the 10% penalty tax to qualified plan distributions maintain after it's been rolled over to an IRA?

Client signs a document (on 10/26/12) effective 1/1/13. The plan is to provide a safe harbor 3% nonelective. This is a brand new plan. Client comes to us today and says that they will not be able to fund the 3% in 2013 and can they amend the plan to take the safe harbor out.

Client provided the safe harbor notice to partcipants in early November, 2012. Can the plan be amended today effective 1/1/13 with no safe harbor provisions? Is the client obligated to make some contribution for 2013?

if you look up one of the song titles you would find out the following:

This song was featured in "Christmas Vacation" and was written by R. Alex Anderson.

Mele Kalikimaka is the thing to say

on a bright Hawaiian Christmas day.

.......................

4 of the black and white pictures have a small paint can - an implication there must be a color involved.

looking at an illustration HCE gets a 13.2% all the NHCE's are getting 4.4%. The 4.4% includes the 3% nonelective. Is this acceptable? I have always been under the impression the nonelective had to be done separately.

We have a client that has already deposit a contribution for the e 2012 year to her SEP and she would like to install a Defined Benefit Pension Plan for 2012. Can the contribution to the SEP be reversed given is was deposited prior to the year end? or can be taken back as a mistaken deposit? Thanks for your thoughts.

What is the penality for the failure of a Plan Sponsor to provide Participants with the annual notice of service provider fees?

What are the implications of 12/31 for a company whose fiscal year is 6/30 and would like to start up a pension plan? ie do they need to start it up by 12/31 to take any kind of 2012 deduction or is that irrelevant due to the fiscal year?

I am aquiring a solo k plan that crossed over the $250k limit on 1/1/12. The sponsor wants a TPA to do the EZ, review the contributions/limits (currently calculated by a good CPA) and help make sure the doc stays compliant. The plan has been around for years and is invested with a mutual fund company. The plan assets consist of both 401k contributions and profit sharing contributions. But, no recordkeeping has ever been done to independently keep track of the money sources. Assuming there are no hardships and withdrawal restrictions are the same, is there any reason to try to go back through time and split the money sources? Or recordkeep the sources into the future, for that matter?

As a TPA, it just feels wrong not to recordkeep the money sources.

The broker for one of the plans we administer wants to designate a model (e.g. 41% Fund A, 11% Fund B, etc) rather than a single fund as the QDIA.

I don't see anything to prohibit that, so long as the requisite information can be compiled and provided to participants in the notice. I think the broker would have to be the one compiling the information.

Does anyone have any experience with this type of QDIA arrangement?

Dog

Is there any reason why someone who participates in an HDHP would choose to participate in a general health FSA instead of an HSA?

Are there any specific expenses that a general health FSA would pay for that an HSA would not?

Due to the $2,500 cap and use it or lose it rules I don't think there would be benefit in choosing an FSA, but wanted to see if anyone was aware of a reason to do so?

Thanks