Got into a debate with a colleague and I'm 99% sure I'm correct but wanted to confirm (sorry if this is a dumb question, just want to make sure!)

Plan is Top Heavy for 2020.  The only contributions made into the Plan in '20 was the one Key employee making a 401(k) contribution (no other Employer money has been contributed).

Based on the 401(k) being made, they are therefore required to make the 3% Top Heavy to all non-Key employees, correct?

I'm in law school writing a paper on ERISA, and I'm trying to work this out in my head. I'm thinking about the fiduciary duties of a plan administrator and how that coincides with possible discrimination backpay awards that may affect the plan. Possible scenario: hundreds or thousands of employees are discriminated against and part of being made whole again involves backpaying them, not only for their actual wages lost due to the discrimination, but monies lost from a benefit plan that they would of had if they were being paid the correct wage. Of course, this scenario is predicated on a plan that is funded based on the employee's salary. So, now the plan is possibly subject to backpay to make these employees whole again.

Another possible scenario: what about a group of employees who've been working for years with a company only to find out they have been discriminated against. Not only have they not received their proper wage but they don't have as much money in their plan as they should because their contribution was based on their salary. Over the course of years, given interest, this adds up. How would a situation like this be handled when trying to make the employee whole again?

How are premiums calculated in a retirement plan? Do most plans already account for any possible retroactive relief or harm to the plan? 

Possible Thesis:

Under ERISA, a plan administrator should have a fiduciary duty to mitigate damages to the plan when an employee files an EEOC charge alleging discriminatory practices by the employer that could result in a retroactive relief being awarded to the employee.

I'm not sure if I have anything here, or if any of this is plausible or relevant. Any advice/comments are more than welcome to help me narrow this down. Thanks, everyone!

Hello, I am on H1B VISA , currently working for one of the company in United States. I am not a US citizen. I have to go back to my country next year, and planning to resign before leaving and I am 40 years old.  I have couple of questions related to my 401k Withdraw, 

1. Can I withdraw 401k money every year say, If I have $100K and withdraw $25000 instead of withdraw complete amount ?

2. If i withdraw partial amount($25k in this case) and if I don't have income in my country, does my tax bracket come down to 20% or below and tax is charged based on that ?

2. I need the money to buy a house back in my country, If I take a 401k loan, I don't have any income to payback, what are my options in this case? 

Any suggestions would be greatly appreciated.

Can a Plan's Tax ID be found on the internet? The 5500's only show the employer's.  Are Plan Tax ID's kept private?

We have a plan that will be terminating in 2021 at some point, date has not been determined.  However, the employer has been sold to new entity and employees are terminated as of 6/30/2021.

The plan is Top-Heavy as of 12/31/2020.  Non-key employee who is a participant and employed by the employer on the last day of the plan year gets a top heavy minimum. 

Is it too simple to say the the plan is terminating as of 11/1/2021 and therefore, no top heavy contribution is required?

I don't want to miss anything being this feels like such an easy question....

Thanks

A client has 3 small  businesses... 

1.  Lawn Service
2.  Professional power sweeping company
3.  Investment properties

While they sound like they would all be using each other's services I am told they do not at all.  

Businesses #1 and #2 each have 1 employee + himself.... #3 is just him.  

Can he open a solo 401(k) plan for business #3 and not worry about the other 2?  Or are we dealing with a control group?  I recall reading another thread where the situation was similar but the other businesses were owned by a spouse therefore there wasn't a control group.   He makes lots more money investing in real estate than the other 2 businesses combined.

Thank you

When filing the 5310 to terminate a plan, is there a requirement to submit and fill out the Procedural Requirement Checklist?  I previously used this checklist as a frame of reference and reminder as to what has to be filed with the 5310. I'm not aware of any requirement that this checklist  has to be completed and filed with the 5310. Any thoughts on this?

Anyone have a good recommendation out there for contribution projections for prospects?  The only one I can think of is Relius Proposal but it has been discontinued.  Any other good ones out there?

Plan sponsor has two groups of employees: "Exempt" and "Non-exempt"; both groups are eligible for the company 401(k) Plan

However, they wish to have two separate eligibility requirements for the plan: The "Exempt" group must complete 30 days of service, and they enter the plan on the 1st of the month following. The "Non-exempt" group must complete 60 days of service, and they enter the plan on the 1st of the month following.

Questions:

One, the prototype we utilize does not allow for a 30 (or 60) day requirement; it appears that it must be in months. Am I missing something?; and

Two, I don't believe you can have a dual eligibility requirement for the 401(k) feature of the plan.

Thanks for any replies.

Anybody see this from Paychex?

A Plan Transfer Fee of $1,500 will be applied to any client who transfers its plan recordkeeping to a new service provider and who is not currently/does not continue to process payroll with Paychex.
Select the Plan Transfer Fee payment method from the options below.
Note: If you do not select an option, Paychex will collect the fee from the Plan's assets.

I'd think that ceasing payroll services and tying that to taking fees from plan assets is problematic.

Good Morning - 

40 year old participant requested a hardship withdrawal from his 401(k) account to purchase a principal residence.  The purchase of a principal residence is listed as one of the safe harbors for hardships in the plan document and there are no maximums or restrictions listed.  Participant submitted the purchase agreement and is requesting the entire purchase price of $500,000 as a hardship withdrawal.  Participant certified they do not have other assets to satisfy the financial need and the employer does not have any information to the contrary.  Any issue outside of the financial hit to the participant as a taxable distribution subject to a 10% early withdrawal penalty? It certainly goes against the spirit of a hardship, but the purchase of a principal residence (without limitation) is deemed an immediate and heavy financial need.  

I appreciate your thoughts. 

After 2.5 years with the DO EBSA, their Solicitor’s Office couldn’t get ESOP Plan administrator to buy back my husband’s stock so he could get his final payoff.  We need a CO lawyer to handle this as the DOL said there is no question of the money being owed. Can anyone help?

401(k) Plan is terminated.  All plan assets are paid out, a final 5500-S/F is filed and the company is sold.

One individual's brokerage account was paid out in a check for $10,000 in March, then a check for 5¢ in April.  The $10,000 is deposited; the 5¢ check goes stale and returns to the account.  Participant can't be bothered to deal with the 5¢ check.  What to do....?

Basic structure - One corporation with limited staff owns two entities, each with their own EIN.  Neither entity has ownership  in the other.

The two entities want to set up a common PS plan, but they want one of the two entities to sponsor rather than the common owner.

Trying to figure out if this is a Single Employer or Multiple Employer plan?

Is there Hurricane Ida relief for 5500's?

Company involved is based in NJ.

Co. B bought Co. A in an Asset Purchase. I checked and it is permissible for Co. B to assume the existing 401k of Co. A.  Effective 6/1/20, the Plan Sponsor was changed from Co. A to Co. B.  Many employees who worked for Co. A immediately became Co. B employees.   I'm thinking:   Co. A. files a 5500 for the period 1/1/20 until the sale date which simultaneously made A's employees B's employees. That 5500 would end with $0 assets.  And it would be marked "final."  Co. B would file a 5500 for the period beginning on the purchase date thru 12/31/2020. 

Am I on the right track? Or the wrong track?

Thanks

Curious as to thoughts on this. I don't think I've actually seen anyone utilizing one. Any thoughts on why? Is it that the 2% employer contribution is a major sticking point, or are there other reasons? Seems like it would work well for many really small employers, if it isn't the required employer contribution that's the problem. Thanks for any thoughts.

A group of physicians is considering a cross-tested combination, 401(k) and cash balance.  One owner-doctor is Muslim and is questioning the hypothetical interest on the allocation when expressed as a fixed-rate.  He is fine with the 401(k) assets being market-driven, but has concerns about the cash balance allocation.  1.  Anyone ever handle anything similar? 2.  Can the hypothetical interest be 0 for his allocation class or is that a reduction?  3.  Is there a better way to explain the interest part that may avoid his objection?

We sent a large group of 5558s to the IRS via Fed Ex on July 27th.  Our clients have now started receiving denials of the 5558 because they were not received timely.  Tried calling the IRS and they have too many calls and the line just hangs up on you.  I know this happened back in 2010, wondering if anyone else has had this issue this year?

Taking over a case that has two Plans, a Profit Sharing and a fully funded Defined Benefit Plan.  Is there any issue with terminating the DB Plan, rolling it into an IRA and then opening a new Cash Balance Plan?

Thanks in advance!