A single member plan that invests through Merrill Lynch made every effort to liquidate before 12/31/2021 so that the plan can be terminated.   The process started in August of 2021 and everything was rolled into IRAs.   For some reason 14 shares of an investment kept being returned to the account.  $1,900 dollars.  It left and came back and left and came back.  The advisor is saying its a ML back office problem.  He has a documented paper trail.  

I am of the mind to say the plan is terminated as of 12/31/2021.  If an issue arises later then deal with it then.  

Sound good?  Anyone ever have this problem?  

A client is telling me that the form 5500EZ does not need to be filed this year because their assets have dipped below $250,000 (as of 12/31/2021).  Makes me nervous to not file.  Do people skip a year if the plan's assets don't exceed $250,000?  Or is it recommended/you recommend to the client to keep filing?  OR by chance, is an EZ plan required to keep filing once a form was filed (even if assets are less than $250,000 now)?

Would a participant who had the opportunity to make up deferrals due to military service under USERRA result in a prior year 5500 being amended to record the deferral in that plan year?

Stupid question, but I just want to make absolutely sure I'm not missing something - not applicable to 457 plans, right? Gracias.

Plan Sponsor changes its name and its plan's name as of 7/1.  5500 for prior 12/31 has not yet been filed. I'm wondering which is the best set of names to file with - the prior which were in effect as of 12/31, or the current in effect as of signing date?

While I have written thousands of QDROs, I have never run into this issue before, so anyone who might wade in here is welcome. DB church plan participant elected a 100% J&S. This elderly couple then divorced years after benefit commencement. My client is the former spouse joint annuitant for the benefit currently in pay status.

Submitted a QDRO to the plan assigning my client (the AP) 50% of the benefit in pay status and confirming her 100% SB benefit already in place. The plan refused to qualify the order because they claim that per the plan document, as an AP, my client is only entitled to a 50% survivor annuity, notwithstanding the fact she is already a 100% joint annuitant.

The language in the plan document does not directly address an in pay status survivor benefit for a former spouse who is already a joint annuitant. If the plan's interpretation of its document stands, the plan would benefit by divesting a current joint annuitant of their property as already paid for by the participant.

Any thoughts?

What happens if an employee's gross pay for a pay period is insufficient to cover the employee's salary deferrals and they are therefore not deducted in accordance with the employee's election? Is this a plan failure? 

I recognize this would be a rare occurrence, but think it's possible in a scenario where an employee has fixed $$ deductions that take precedence over benefits (i.e., child support, wage garnishments). 

Thanks in advance!

One-person DB plan, adopted in 2022 for 2021.

First contribution deposited in 2022.

Say contribution is > $250,000, file 5500 for 2021?

Say it is less, no 2021 filing needed.

Let's move to 2022:

2022 contribution deposited in 2023, taking net balance over $250,000.  File for 2022, or ultimately file first 5500 for 2023?

The client thought they were a QACA Safe harbor for several years now – BUT they only matched up to 5% .

The formula was 100% up to 3% and then 50% of elective deferrals on the next 2% of compensation. They put in a total of 4% (0.5% more than required for QACA safe harbor) but did not stretch the match up to the required 6%.    The vesting was 100% after 2 years of service.

Since the client matched more than the required 3.5%, do we need to do anything?  

Is the Lifetime Income Disclosure needed for an owner-only 401(k) plan?  I would think (hope) not.  These often involve one broker account and thus the disclosure will not generate from an institutional record keeper.

Tom

For ERISA Plans I know that the spouse has to be the designated primary beneficiary and they spouse has to acknowledge that they are not the primary beneficiary of the Plan if someone, other than the spouse is designated. Is that the same requirement for Non-ERISA plans? Are Non-ERISA 403b plans subject to the Retirement Equity Act?

Curious to know what others are doing. In Part I, item 2, field b of the Form 5500 Schedule C, do you use service code 10 for non-3(16) third party administrators handling such things as preparation of 5500, 1099R, 8955-SSA and other governmental forms; compliance testing; providing annual participant notices; etc.? If not, what code do you use?

Hello, 

Is there any guidance regarding whether a plan may impose a post-deductible flat dollar copayment for medical coverage?  The flat dollar approach is apparently allowed for pharmacy coverage only. If that is true, then does the flat-dollar element for medical services render the plan as being no longer a qualified HDHP?  If so, can anyone provide guidance to support either way. Thank you.

Company establishes Profit Sharing Plan (not a 401k) in 2020. 90 participants beginning of year. Makes no contribution for 2020, so 0 assets. No 5500 filed.

As of 1/1/21, there are now 130 participants. No contribution to be made for 2021, so still 0 Assets. If they were to file a 5500, they are subject to audit. Doesn't want to file a 5500 since there are no assets.

Comments? What would the auditor audit?

DIvorced plan participant dies.  QDRO $$ was allocated to the ex-wife a few months ago. Plan participant dies last week and his bene is still the ex-wife.  No updated bene form was completed. She is entitled to his 401k, correct?  His contigent benficiares are his 2 sons. 

I have a situation where a division of my company is proposing to pay an employee in 2022 for services rendered for the period 9/2022 through 6/2023.  Besides the obvious downsides involving how advance pay is reflected on the company's books, the risk if employment terminates before 6/2023, and possible problems with IRS caps on compensation and contributions, I recall there is some specific reason why qualified plans cannot consider accelerated compensation when determining compensation.  (We have a money purchase and a 401(k) plan.)  I have been searching but have not found anything but I recall this coming up with clients in my previous job.  Can anyone point me to a cite?  I'd be grateful!

The FIS Relius pre-approved governmental 401(a) DC plan document includes the standard override when excluding temporary and part-time employees such that, if an employee in this group actually works 1,000 hours in a year, they become eligible despite being in a category of temporary or part-time employee.

The only source of this rule that I'm aware of is found in 410(a). Under 410(c), governmental plans are exempt from "this section," i.e., all of section 410, including section 410(a), not just 410(b) minimum coverage requirements. 

Is there some other rule that would require including this override in a governmental plan? Or might this have been just a design choice by the document provider? Or perhaps a provision the IRS required as a condition to pre-approval?

Hi

PS plan, first year (combo with CB).

Vesting starts with plan inception i.e. no prior service is recognized. Vesting is 6 year graded, 2/20.

11 total participants during the year, some entered at BOY and some entered mid-year.

Last day and 1000 hour requirement for contribution.

5 terminated during the year, some left, couple fired but all replaced with new employees during the year.

Out of 5 terminated, need to include 2 to pass testing.

Doing 11-g corrective amendment.

Do I need to 100% vest or just partial vest? I am aware that some would 100% vest under 11-g rather than partial vest but do partial termination rules overwrite here?

Any comments/thoughts are appreciated.

Have a client that failed to give a 30 day fund change notice to participants.  From what I can tell, there is not an actual penalty prescribed by the DOL other than a plan sponsor could be held liable for a fiduciary breach.  Based on this I was going to advise them to just give out the updated notice ASAP.  Anything I am missing?  

We have a client, call him John who has a 401K Plan and the Plan allows rollovers into the Plan.   Both a Husband and Wife are employees of John who sponsors the plan and both the Husband and Wife participant in John's plan; to say it another way, both husband and wife have separate participant account balances in the John's plan.  The wife recently died and her surviving spouse wants to receive  a distribution of his Deceased Wife's account in John's plan as a subaccount under his account in John's plan.   Is this type of distribution allowed and considered an eligible rollover distribution under Code Section 402(c)(2) and (4)?

Thank you,

Dawn