Just curious as to what most people do. In general, for plan allocation purposes, do most documents you see INCLUDE all or most categories of "post-severance comp" or EXCLUDE all or most categories of "post-severance comp"

FWIW most of the plans I see INCLUDE it. I'm reviewing a potential takeover where it is all excluded, which brought this question to mind.

A couple of questions:

1.   When restructuring do I have to an HCE in each component group?  As long as each group passes coverage, I don't think so, but hoping to verify.  I do understand that doing that may mean plan has to pass ratio percentage test at 70%.

2.  If each rate group in the component plans pass ratio at over 70%, do I have to pass the ABPT on the whole?  Normally I wouldn't look to the ABPT if every rate group is over 70%, but in this case the only reason that is happening is because I restructure. 

Thanks for any guidance.

An employer now may give a de minimis financial incentive to employees who elect § 401(k) contributions.

If that incentive is a “low-dollar gift card” some in Congress mentioned, an employer likely must tax-report on Form W-2 as taxable wages the gift card’s cash-equivalent amount.

What do BenefitsLink neighbors think about whether America’s payroll people are ready to take on that work?

Anyone not able to login to Relius ASP this morning (2/11/2023)?

Client has not paid withholding due on participant distribution for 2022.  Client received the 20% check from the financial instition, didn't ask anyone what check was for, and deposited into the business checking account.

As I was completing Form 945, asked client for dates paid and she tells me it hasn't been.

I have called the payment in with EFTPS before, I assume payments made online handled similarly, but 945 withholding.

Question is, do we need a separate PIN to make a 945 payment?

Accountant tells me the client pays all 941 through EFTPS; accountant has no idea how payments are made with 945, which I find incredible.

I feel like I've debated this several times already, but here goes... A 401k participant became eligible to enter the plan on 1/1, but didn't begin deferring until the next entry date, 7/1.  Is the plan sponsor required to true up the SHM for said participant based on his comp from 1/1-12/31?  Thanks.

Never mind.

deleted - never mind.

Would it be a problem under any federal law (e.g., IRC 401(a)(2) Exclusive Benefit Rule, IRC 503 prohibited transaction rules…) for a qualified 401(a) non-electing church plan to add a provision to its plan (and 501(a) trust agreement) to provide for indemnification of the board members and employees who administer the plan against liability (except in the cases of willful or wanton conduct, gross negligence, and gross malfeasance), with such indemnification to be payable from its plan assets. Assume that there are no state law issues to consider (focus is on federal law). Of course, since it’s a non-electing church plan, it is exempt from ERISA. Any specific or general thoughts would be greatly appreciated. Thanks!

Would it be a problem under any federal law (e.g., IRC 401(a)(2) Exclusive Benefit Rule, IRC 503 prohibited transaction rules…) for a qualified 401(a) governmental plan to add a provision to its plan (and 501(a) trust agreement) to provide for indemnification of the board members and employees who administer the plan against liability (except in the cases of willful or wanton conduct, gross negligence, and gross malfeasance), with such indemnification to be payable from its plan assets. Assume that there are no state law issues to consider (focus is on federal law). Of course, since it’s a governmental plan, it is exempt from ERISA. Any specific or general thoughts would be greatly appreciated. Thanks!

A 501(c)(3) employer provides medical care as a health center.  It files Form 990 annually.  It has provided a copy of their 2015 IRS letter acknowledging they are a 501(c)(3) public charity. It has sponsored a 403(b) plan since 2003. 

Now they claim that they are also a governmental entity and therefore not required to file Form 5500 nor obtain a plan audit.  

Part of it's claim to governmental status is that they receive federal funding.  Additionally they are deemed as FTCA.  I do not believe just because the clinic employees are treated as federal employees for malpractice insurance coverage purposes, the entity is therefore governmental.

If the center was not established and is not maintained by a health district, city, county, state or federal governmental entity, it is not governmental, correct? 

Thank you. 

I have a client that set up everything for a 401(k) effective 5/1/22. It is unclear how much, if any, communication was provided to employees about the start of the 401(k) plan. The Plan Sponsor didn't actually start deducting any deferrals and nothing has been paid to the Custodian. They are interested in moving forward with it finally. What are the consequences of having a plan in place, but not using it for that plan year? What are the consequences of having a plan in place and not telling participants about it? How would you recommend that they move forward?

I have a small defined benefit plan that has been frozen to new entrants for a few years. It is no longer passing the ratio% test. Based on the numbers it would be a nondiscriminatory classification but is the set of employees hired before a certain date a reasonable classification? The formula is a safe harbor formula so the plan still passes 401(a)(4) by itself. Of course if i cannot get the sb plan to pass the average benefits tests I will move onto testing on a combined plan basis with the dc plan for which coverage will not be an issue. 

Do you guys just submit your refunds to the carrier (with or without earnings) and just have them withhold the 10%.

Or do you get the participant elect withholding?

Or, it is a timing issue, like with RMDs?  later in the year, we just process the RMDs automatically with 10% withholding because the plan (and participant) gets in trouble if it's not done by 12/31 (in most cases).  What if you complete the ADP test on March 10?  Are you waiting on tax elections from the HCEs or are you just sending int he requests and have them w/h the 10% by default?

Can an ongoing FSA prorate new employees to the maximum allowable FSA for the year?

Ie new employee is eligible 3/1, so their limit is 10/12*Full limit?

Am currently waiting for copy of the SPD/Employee Benefit Guide.

I read somewhere the flexible match notice is not need for the first year the plan adopts the cycle 3 doc with that language.

Can someone point me to the cite for that?  I don't see anything in my plan doc about it.

The client's Section 125 SPD says the effective date of a QLE (in this case, marriage) will be on a prospective basis whereas the ERISA SPD says the effective date of the new spouse's coverage would be based on the date of the event.  The employee submitted the necessary enrollment paperwork 10 days after the event.  I did some research and found that in these cases the employee is entitled to the benefit of the more generous of the 2 documents.  So, the ERISA SPD would govern in this case.  Then I was discussing with a coworker and their thought is the cafeteria plan document is the more accurate, unless it is the QLE is birth or adoption.   Does anyone have any thoughts on this?   

Let's consider a hypothetical situation.   We have a lovely couple, he is an independent 1099 ER doc, she has a one-person dental office running her business as a PC.  The husband happens to be very good with finances, budget planning and all the financial matters and handles those issues for his business and as a W-2 employee for the wife's dental office.  She is very good with marketing, internet media, licensing etc. and handles those aspects for herself and for the husband's business as a W-2 employee.  Am I dreaming that after Secure 2.0 change to family attribution rules that particular couple would be able to double-dip everywhere on retirement plans?  Two 401k plans, 2 DB/CB plans, etc.?

Someone age 65 retired from two local governments and has two 457(b) plans and is desirous of converting the two plans to after-tax.

The individual initially funded unrelated Roth IRA's way back in 2008 when Roths first came into existence.   Despite the huge tax hit to convert/rollover the accounts to after tax-If the distributions could be taken within five years with no 10% penalty.   O is there in fact a five hear holding period to eliminate any money being subject to the 10% tax?

So, usually Morty electrically signs the 5500 and has EFAST credentials under his name.

What happens if Lorena's name is on the 5500, but it's filed using Morty's credentials?  The software let it go through.