On July 1 my wife enrolled in a non HDHP thru her employer.  Along with this came eligibility to enroll in an FSA which she declined.  I have a HDHP thru my employer.

Does the eligibility of enrolling in an FSA now exclude me from contributing to my HSA for the term of her employers FSA plan year?

Or is it since she declined to have funds contributed to this FSA still make me eligible for HSA contributions?

I have been asked to terminate an integrated Profit Sharing Plan with a 7/1-6/30 Plan Year. The Plan has been in effect since 1986. The accountant has been completing the administrative work from the inception until the 6/30/23 year end. I have been retain ed for the 6/30/24 PYE and the final year with a termination date of 8/31/24. Many issues, like name on the 5500 Form not matching the Plan Document.

The accountant has been filing Form 5500 and Schedule I since 2009, when the 5500-SF was introduced. I was going to file the SF for the 6/30/24 and short Plan Year, BUT the last post by Belgrath raised a question about filing a wrong form. Paul I answered that the IRS could invoke penalties for filing the wrong form.

My question is; should I continue filing the 5500 and Schedule I, knowing it is the incorrect form or switch to the SF and perhaps "raise RED FLAGS" for all the previous years?

All help will be GREATLY APPRECIATED!

Have a SAFE 4th.

DPSRich

Would this requirement also be applicable to participants who have reached normal retirement age (NRA) under the plan? That is, I know that participants must be 100% vested in employer contributions at NRA, but does that mean a participant who has reached NRA under this scenario would be 100% vested in the company match for the entire year even if they left before 12/31? Or would they only be eligible for the match accrued up until they left? (Match is deposited annually after year-end).

Let's say a participant in a 401(k) plan has $100k in Traditional sources and $50k in Roth sources as of 12/31/2023.

Since RMDs from the Roth sources are no longer required in 2024, would it be correct that only the $100k Traditional balance would be considered for calculation of RMD required for 2024?

Thanks.

An employee is the subject of a QMCSO with the employee's child as the alternate recipient. The employee is married to another employee (the step-parent). The parent/employee is enrolled as the spouse of the step-parent/employee. 

May the child be enrolled as a dependent in the family coverage of the step-parent/employee, or should the parent/employee be removed from the spouse's family coverage and enrolled as a participant in the employee's own right with the alternate recipient as a dependent of the parent/employee? 

We took over a retirement plan last year and never received the Roth basis information to calculate if a distribution was qualified or not.  The plan is now terminating.  I know that a termination does not make the roth distribution qualified, but what do any of you do if you do not have the 5-year information from a prior TPA or client? 

Suppose you have a 1-person plan with over 250k in assets, so subject to filing a 5500-EZ. Suppose a 5500-SF is filed instead. Is there a PENALTY for filing the SF? Are you considered to have not filed? I'm not 100% sure on this.

if a plan has been frozen from 1/1/2024 (both accrual and participation are frozen), a participant met all eligibility requirements and should enter the plan on 1/1/2024 if the plan is not frozen. we don't need to test 401a26 test due to SECURE act 401a26 relief; there is no accrual so no 410(b) test. but I'm just curious - in this case, should he/she be included in non-discrimination testing due to meeting all eligibility requirements? or he/she should not be included in tests due to 1/1/2024 freeze date? thanks!

First time filing under DFVC for an EZ.

I recall with regular 5500's, you file the 5500 first, then file the DFVC request.

Seems unclear with the instructions, other than that you cannot do an electronic filing to get DFVC relief.

Mailing address for 5500: 

Department of the Treasury

Internal Revenue Service

Ogden, UT 84201-0020

Mailing address for 5500 under DFVC: 

Department of the Treasury
1973 Rulon White Blvd.
Ogden, UT 84201

So unclear to me if there should be just the 1 DFVC filing, or a 5500 filing as well?

Can a participant have a racehorse as an alternative investment in a 401(k) Plan?

A participant would like to purchase part of a racehorse using their 401(k) account and then hold the ownership in the Plan as an asset. Other than keeping all of it "at arm's length" and watching for obvious prohibited transactions and possible Unrelated Business Income, is there anything preventing this type of alternative investment from being held in a 401(k) Plan?

1. Harry inherited his Mom’s IRA in 2019 

2. Harry is using the stretch IRA and taking payments based on his life expectancy.

3. Harry is married

In the event of the Harry’s death what happens to his inherited IRA.

1.      Can his wife roll the funds to her IRA?

2.      Can the wife take payments based on her life expectancy?

3.      Is the wife deemed a Designated Beneficiary and eligible to continue taking advantage of  the stretch provisions.

Thanks

I know that if a Plan qualifies for a Form 5500-EZ, you don't have to file if the assets are less than $250,000.  I believe you do have to file a Form 5500 or Form 5500-SF, even if the Plan is less than $250,000 but I just wanted to confirm.

The Plan in question covers:

1) A 40% owner
2) The spouse of the 60% owner

Reading the EZ directions, I do believe they fall under the 5500-EZ.  I'm just trying to cover my bases

Thanks in advance!

Question about mergers/acquisitions and successor plan rules.  Company A and Company B are a parent subsidiary controlled group and both participate in A's 401(k) plan. Company C buys the stock of Company B.  Company B immediately ceases participation in the A's plan and becomes a participating employer in C's 401(k) plan.

Company C refuses to accept a trustee to trustee transfer of assets and liabilities for B's employees from A's 401(k) plan, nor will C agree to a spinoff and merger on behalf of B's employees.

I wouldn't think B's employees would be eligible for termination distributions from A's plan until they terminate from Company B, right?

Can Company A spin off the portion of the plan that holds B's employee's balances, terminate it, and pay out the balances even though B is now a participating employer in another 401(k) plan (C's plan)? 

Hello, 

I don't deal with any other TSA plans but I have a plan sponsor looking for help. The TSA plan has employees and former employees with different record-keepers than where new money is going. Can they eliminate those other record-keepers, or are they stuck with the money there? What are some possibilities to simplify this for the PS?

Hello. The DOL template for the SAR for welfare and pension plans includes the two-paragraph blurb on the Paperwork Reduction Act. However, in another location on the DOL website, there is instruction not to include the blurb. I called the DOL Office of the Chief Accountant to confirm which way to approach and they have to do research. Does anyone have advice on which way to approach? Many thanks! 

Traditional 401k plan has an ACA feature with auto escalation (not EACA nor QACA). Plan is a calendar year plan but auto escalation occurs on July 1 to coincide with pay raises. Plan provides annual ACA and escalation notice between 30 - 90 days before the beginning of the plan year. 

Question - since the escalation takes effective later than 90 days after the annual notice is given, is a second notice required to be given later in the year?

I have searched the EOB and these boards, but can only find notice references when the escalation occurs on the first day of the plan year. I am thinking a second notice should be given, but am getting push back to prove it. 

Thanks

I am 67 and retired but have not begun withdrawals from my well-funded traditional IRA. We own our home outright – no mortgage. We need a new car, but don’t have the cash for it. What’s the best strategy for buying this car? I have considered a home equity loan and car loans. But those would be paid back with IRA withdrawals anyway. Why not withdraw the full purchase price of the car from the IRA? I would the buy the car, then sell our old car on my own and return the proceeds from that sale to the IRA. If I sold our old car first we would be without a car and under pressure at the dealership to move faster than I am comfortable doing.

1. Is this my best strategy versus some type of loan?
2. Can I deposit the used car proceeds into the IRA?

Do I need to file a Petition for Contempt if my ex-husband refuses to sign a QDRO?

Helpfully expound upon the restrictions for distributions of rollover amounts. Particularly, if rollover amounts remain subject to in-service distribution restrictions. The provenance of the rollover amounts perforce might affect the situation, if the rollovers proceeded from elective deferrals, Roth amounts, after-tax distributions, amongst perhaps further items. 

https://www.kiplinger.com/taxes/supreme-court-strikes-down-chevron

Worth a read.  This will change our world dramatically. For the better or for the worse I do not know.  My guess is some of both.