An Adopting Employer left a PEO in 2021. For the 2021 Plan Year, there are 106 participants as on 1/1/2021. Does the Plan need a 5500 with audit for 2021, or can it file the 5500-SF under the 80/120 rule? 

For participant loans that are being refinanced, can the maturity date go ever go past 5 years from the original loan?  https://www.law.cornell.edu/cfr/text/26/1.72(p)-1, 26 CFR Section1.72(p)-1 Q-20, has that if the replace loans satisfies Section 72(p)(2) and this section determined as if if the replacement loan consisted of two separate loans; to the extent the amount of the replacement loan exceeds the amount of t he replaced loan, a new loan is amortized in substantially level payments over a period not later than the last day of latest permissible term of the replacement loan.   So if a refinanced loan is less than the available amount is it treated as a new separate loan and has a maturity date from the refinanced loan date and not the date of the original replaced loan?  Q-10 makes it sounds like it can.  Is there any other clearer direction than Q-20?

Is it permitted to name a non-US citizen as a beneficiary for a US 401k plan?  The intended beneficiary is not a US citizen, does not live in the US and does not have a US social secuity number.

Thank you

I have a client with an individual 401(k) that has not reached the 250k threshold in that plan; however, he does have a DB plan for the same business, that is over 300k. The person who administers that plan and files that 5500 stated that I should be filing a 5500 for the 401(k), due to aggregated assets in both plans. He has not made contributions in several years, as the business was dormant. Do I need to file a 5500 for the 401(k)?

For plans that file 5500-EZ, but have 2 participants, typically owner and spouse, and the plan has one 'pooled' trust, I'm thinking the following are not needed:

• List of Investments
• 8955-SSA (for retired spouse) - This was previously an attachment to regular 5500 and is filed with the IRS, so doesn't seem like it would be filed

Is the 100% of comp shown below (pasted from IRS site) a typo and should really be 25%? Or is the non elective ER contribution to a SAR SEP IRA (a grandfathered SEP IRA that allowed ee deferrals) allowed to be up to 100 % of comp? Thank you.

May an employer contribute to the SARSEP for its employees?

Yes, the employer may make non-elective contributions to the SEP-IRAs of its employees subject to an annual addition limit. The annual addition limit is the lesser of 100% of the employee's compensation (limited to 305,000 in 2022, $290,000 in 2021, $285,000 in 2020 and $280,000 in 2019, subject to annual cost-of-living adjustments) or $61,000 in 2022, $58,000 in 2021, $57,000 in 2020 and $56,000 in 2019, subject to annual cost-of-living adjustments). In determining this limit, all

Hi

XYZ DB plan is terminated with overfunded assets (100k).

All participants elected to rollover their distributions to XYZ PS Plan. Total was 1M

The overfunded portion was deposited into the XYZ PS plan (under qualified replacement plan rules - QRP) as excess DB assets to be allocated in the future.

In preparing the final 5500 form (2021 plan year) for the DB plan, I am confused by 2 lines:

8j and 13c

Are any of the above assets considered as transfers?

I do not believe the participant rollovers of 1M are (they were directly deposited into the DC plan accounts from the DB plan but as rollovers)

How about the QRP portion of 100k as also was directly deposited into the DC plan account from the DB plan account.

Thank you

I have an employer that employs select employees to work in medical and laboratory settings  ( small percentage of the employee population).  The employer provides vaccinations, TB testing, vision screening, initial health screening, blood pressure checks, first aid for work-related injury and illness evaluation, treatment, and case management, research lab exposure emergency access and follow up; and  blood and airborne pathogen exposure valuations. Many of these "health plan" services provided on-site are required under OSHA.  The services are not provided to other employees who don't work in the medical and lab settings. Although the services go beyond the limited on-site exception for ERISA, we can take care of documents and Form 500 reporting.  I also am fairly  comfortable that the services are either preventive or not significant for HSA participation for any of these employees in the HDHP. 

The critical issue is COBRA. The services go beyond the limited on-site clinic exception for COBRA. By law, the employer cannot provide these services to non-employees. COBRA doesn't specify where services will be performed  so for other employers who offer vaccines and limited tests, we offer COBRA and send employees to a drug store.  However, in the current situation there are multiple services and referrals to a outside providers would be difficult and expensive.   

The employees are required to have the services to perform their jobs and many are required by law.  From a policy standpoint this makes no sense to require COBRA for health services required for a job when the employees are no longer employed.

Any thoughts?  Hopefully the agencies will one carve out limited  on-site programs. 

Single member company wants to invest in a UK based company.  The company is not publicly traded.  Are there mixed thoughts?  Can it be done?

Thanks

We have an employer who wants a projection for a 2022 profit sharing contribution. Client insists that the bonus being PAID in February or March of 2023 (which is based on 2022 compensation) will be reported on the 2022 W-2.

I don't see how this is correct, or possible, and although it isn't our problem (we use the projected figures we are given) and it is only a projection, I'd still like to confirm that I'm not crazy (on this issue - be nice!)

Hello,

We are an RIA firm with expertise as 3(38) fiduciaries. We are trying to partner with TPAs as we have incredible expertise in the Collective Investment Trust space and 401k/DB Plans. We make great partners with TPAs as we are a very hands on firm with experts from large 401k providers. 

If you were approached by an RIA, what would you like to hear? What would entice you to work with a 3(38)? 

Any assistance would be appreciated!

Thank you

I have a client that would like to make a profit sharing contribution by her 2021 extended tax filing deadline of 9/15/22 for the 2021 plan year.  We can get the calculation done, but, the existing 401(k) plan does not currently offer profit sharing.  Is it permitted under the SECURE Act to retroactively add a profit sharing feature to an existing 401(k) plan for a prior year?  This is not starting a brand new qualified plan (such as profit sharing or cash balance) retroactively (which is pretty clear in the SECURE Act as acceptable) but instead adding the profit sharing feature to an existing 401(k) plan.

As a side note, if it matters for context, this is a solo plan (husband and wife).

Thank you.

Can someone shed light on the difference between IRR and IRT?  Our BPD Cycle 3 says IRR involves an amount "permitted to be distributed in an eligible rollover distribution" and IRT involves an amount "not otherwise distributable."

An IRR I believe allows in-plan conversion of pretax deferrals at any age.    Beyond that, I'm not 100% and can't seem to find sources that explain this well.

We were to amend a plan to allow in-plan conversion - presumably both IRR and IRT.  Amercan Funds RKD says on their website they do not support IRTs. 

Thank you for your comments.

This may be more of an accountant question, but I'm not sure the answer.

We have one plan that was adopted by two employers (one employer is owned by the husband, the other by his wife).  When it comes time to fund the contributions, do they need to be funded by each employer or can one employer fund the entire contribution (including the other employees)?

In other words:

Employer A - 5 eligible employees
Employer B - 5 eligible employees

Does Employer B have to fund the portion of the contributions for their employees or can Employer A contribute (and deduct) the entire amount?

I have a client that never makes employer contributions anymore but they have a balance in the forfeiture account. I've tried getting the plan specs for fee payments set up so that fees will first come from forfeiture account then from participant accounts. But every time I try and post the fees it all comes from participant accounts and the balance remains in the forfeiture account. Can anyone help with this? Can I do this through a forfeiture adjustment transaction? 

Nothing wrogn with this right, ADP and ACP Safe Harbors still apply?

Yes I know about the 415 limits and will caveat about that.

I will like to know if profit sharing and pension contributions to a plan are tax deductible or not through the state of New Jersey for a New Jersey employer. There are some confusing reports about this. 

Hi everyone! We are a small organisation (less than 10 staff) and have been told by our payroll company that we need to establish a cafeteria plan to be able to do pre-tax health & dental insurance. The payroll company offer a POP plan doc for $400 which includes a NDT kit. We think we qualify for a simple cafeteria plan and if we are right, NDT shouldn’t be necessary. 2 questions: 1-is there anything we should be alert to using the payroll company plan doc ie is that usually ok or should we be getting the doc from somewhere else? ; 2-who could tell us whether we do in fact qualify for the safe harbour ie who advises on this stuff? We are NFP so fee conscious. 

A self employed person with no employees uses a payroll company to handle payroll.  They have no employees and no other business.  

The Owner intended to set up a Solo(k), and the payroll company took $20,500 as a pre-tax deferral for 20,500. The Owner never drafted documents to get a Plan set up and the $20,500 is setting in a  business savings account commingled with other monies.  They have already filed their 2021 taxes.

How would you handle? Would you draft a document and have the move the $20,500 (plus earnings) into an investment account?  And if so, would you also calculate lost earnings due to the late deferral?

Or just tell them not set up a Plan at all for '21 and start with a Plan for '22?

Ugh, these Solo(k)'s can get so messy.  Probably needs to be some more regulations around these so people don't continuously mess these up, IMO.  

A recent court decision treated as proper an individual-account retirement plan’s provision, stated at least on the plan’s beneficiary-designation form, that: “The Allocation % [between or among a class of beneficiaries] must be whole percentages.” The participant submitted a form that asked for “33 1/3%” for each of her three siblings. The court found that—even if the plan’s administrator might have had discretion to accept the not-in-good-order designation (Honeywell argued it did not)—rejecting the participant’s attempted designation was no breach because a fiduciary administers a plan “in accordance with the documents and instruments governing the plan[.]”  Gelschus v. Hogen, No. 21-3453, --- F.4th ---, 2022 WL 3712312 (8th Cir. Aug. 29, 2022) https://ecf.ca8.uscourts.gov/opndir/22/08/213453P.pdf

How common is this whole-percentages provision?

Do plans require a whole-percentages beneficiary designation because the plan’s sponsor or administrator seeks to fit within a recordkeeper’s or other service provider’s software and systems?

If a participant specifies 33%, 33%, 33%, does an administrator reject the form as not adding up to 100%

Or does an administrator accept a form that adds up to only 99% (or 96% for six beneficiaries)?

If an administrator accepts a less-than-100% designation, does the plan or a plan-administration procedure provide an adjustment rule so the beneficiaries’ shares exhaust the whole of the participant’s account?

BenefitsLink neighbors, how does this work in the real world?