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Curious as to whether anyone with a "pipeline" or "contact" at the IRS has heard any rumors as to whether this foolish rule will be changed? It just isn't reasonable for someone who is a former LTPT and now a "regular" employee to receive a year of vesting credit for working 600 hours, whereas someone who started as a "regular" employee must work 1,000 hours to receive a year of vesting credit.

Not to mention, of course, the administrative nightmare and client confusion...

Per the audit report, there is an amount reported as a transfer out and within the footnote, it is indicating that assets were refunded to the company for the provision of benefits for or on the behalf of participants for claims incurred.  On the Schedule H, is this reported under 2e(3) as an 'other' benefit payment and payments to provide benefits or under 2l(2) as a transfer out or within another field?  Initially, I thought it would be a transfer out, but the assets went back to the company and not to another plan, so I wasn't sure the plan information to report under 5b which is required if reported it as a transfer out.  Any guidance on this topic is appreciated.  Thanks. 

Hi

Looking at a possible takeover plan which I think there may be an issue with deduction. I think I know the answer (sorry, a bit fried brain today) but want to see if anyone has a fresh look and comment. My apologies for a rather long explanation. If I am not clear in any of the points, please let me know.

Not sure if a CG or ASG or if any at all but for arguments sake let's say either CG or ASG (still waiting on info).

Looking at 2023. this is a DB plan.

Prior TPA valuation report shows 300k as salary for pension purposes. Deduction was 200k.

Company A (a partnership) sponsors the plan. The majority partner's se income in box 14A shows 300k. There is also 500k under box 14C - non-farm income (which cannot be used for pension, if I recall correctly). Assume the other partner is silent and has no box 14A income. 

If this was the only company sponsoring the plan with ASG/CG, even the though the deduction is within 300k se income limits under box 14A, the salary is definitely not as they would need 14A to be over 500k+ (excluding the 1/2 se tax adjustment), as per prior TPA report.

Now, Company B (a sole proprietorship), which is part of CG/ASG as assumed above and owned by the majority partner 100%. Line 31 of the schedule c shows 300k (but not adopted the plan).

If I recall correctly, for 415 limit purposes, you add both entities, please correct me on this.

However, for pension/deduction purposes, one cannot add both incomes for valuation purposes, only Company A can be used, please correct me on this as well.

Let's assume that it was intended that both companies to adopt the plan, say, going back to 2019, inception year (I have a feeling the plan operated similar to 2023 in prior years, afraid to ask/check but must).

Can this be corrected without VFCP i.e. is there a self-correction on this or must file with the IRS for correction? Any other comments/suggestions?

Thank you for your time.

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I just cannot imagine that there will be any delays in mandatory Roth catch-ups, right?  I mean ADP, PayChec, Paylocity, PayCor, Paycom collectively must have spent hundreds of millions. Recordkeepers made substantial investments.  I just cannot imagine it would not cost tens of millions more to delay.

And then there is part about S20 being revenue neutral, paid for in large part by these mandatory roth catch-ups.

But here is an article from Willis Towers Watson saying it is possible.  It can't be possible though, can it?  I could see them saying "any good faith effort will be treated as not a failure even if something slips through the cracks."  But not put it on hold altogether.

https://www.wtwco.com/en-us/insights/2025/08/roth-catch-up-requirement-effective-date-developments

This is possibly a stupid question but need to check.

Company A and Company B are CG.

Setting up a plan for Company A (sponsor) where Company B is an adopting employer.

Plan excludes leased employees.

Owner contacts and says, a Company A leases employees to Company B, the leased employees should not be excluded.

I read the section for leased employees under basic plan document and my understanding is that Company A is not a "leasing organization". I do not think it applies here as it is a different definition like a temp agency or something like that.

Besides as both entities are CG and no employees are excluded, who cares.

Am I missing something here?

Thanks

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If erroneous pension annuity payments from a defined benefit plan (no beneficiary or joint and survivor annuity at issue) are made following a retirant's death due to late death notification and the plan administrator is unable to recoup from the estate, would a 1099-R be issued to the estate (no information is available as to estate tax id)?  Is there a way to adjust the withholding that was submitted on future deposits or obtain a refund of the withheld amount-- through a 945-X (although instructions state it's limited to clerical errors) or other means-- because no party had a legally binding right to the payments after death?  This has to be a common scenario, yet I haven't found guidance directly addressing the death overpayment situation (only guidance addressing overpayments to living retirants/participants).   

So, you have Plan A sponsored by Employer A. Employer B signs on as a participating employer, but not a CG/ASG and thus a MEP.

Plan B winds down to one employee. Plan B is supposed to spin off, and then immediately terminate plan. Plan B employer never signs the paperwork to do this, and in the meantime, the one employee terminates employment, and the distribution is processed by plan A, where the assets were held.

The question is, does the spinoff still need to happen, and a first and final 5500 form be filed for Plan B? There are no assets to spinoff, and the temptation is strong to just ignore it, but it feels all wrong.

Anyone ever encountered such a situation?

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When would you use code 2D on line 9a?

I have a 401(k) Profit Sharing Plan where the employer also maintains a cash balance plan. Because the CBP was not PBGC covered in the first year, the 31% rule is applied; accordingly, the 401(a) feature of the 401(k) PSP is capped at 6%. My thought is this sounds exactly like "Plan benefits are subject to offset for retirement benefits provided in another plan or arrangement of the employer", but I've not swam these waters frequently and I'm not able to find any guidance on this code in particular.

I know that when you are testing both a 401(k)/Profit Sharing Plan and Cash Balance Plan together, the contributions to the Profit Sharing are limited to 6% of eligible compensation.  Does that 6% include any Safe Harbor Match that is made to the 401(k) Plan?  Or does it only apply to the Profit Sharing?

I think I'm confusing myself so I just want to make sure.

Thanks in advance!

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Good article - 

https://www.mayerbrown.com/en/insights/publications/2025/08/revisiting-the-state-of-the-law-in-erisa-forfeitures-cases

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My husband and I recently divorced.  We had chose to each keep our own pension plans and change beneficiaries to our children from previous marriages.

Our settlement agreement stated we would each retain 100% of our individual pensions and beneficiary was to be revoked including any designation of each as a recipient to survivor benefits.

The settlement agreement also stated the court reserves jurisdiction to issue a QDRO.  And if the plan did not permit a change to beneficiary then a constructive trust would be setup to ensure the children would receive the pension benefits.

i worked for HP and their plan is a defined benefit pension plan which is managed by Fidelity.

i worked through Fidelity and kept hitting a brick wall. No change to beneficiary after beginning to draw from the pension.  Then a Fidelity agent suggested I get a QDRO which would address the beneficiary rights.  However, the third party company I was referred to said there was no delegation for beneficiary in the company QDRO.  Beneficiary changes were not allowed.

i contacted the companies HR department and found an HR manager who gave me some guidance on getting the beneficiary changed.  I needed to provide a letter of instruction and my final divorce judgement outlining the terms of the pension.

i provided this documentation and was denied a beneficiary change.  I asked the HR manager who would receive the pension benefits upon my death. And he stated it would remain my ex-husband.

i am going to try and appeal this decision.  Meanwhile has anyone encountered this type of denial before?  If so, have they had any success on subsequent tries?

I didn’t provide an updated beneficiary statement as I understood from Fidelity the reluctance is the payment is calculated based on my husbands age and life expectancy.  To make that a non issue I stated to just restore my full pension.

i do have a beneficiary designation form which has a notarized signature from my ex-husband stating he will agree to having his beneficiary rights revoked.

The beneficiary form includes trust names and individual names under the trust. Or the beneficiary names.

I've been doing some reading about Retirement Trusts.  Would using a Retirement Trusts work around this problem if I submitted the beneficiary form with a trust named?

if that fails and my ex-husband passes away how do I setup a constructive trust that will pass along his pension to his kids but not have to pay taxes on funds I won’t receive?

Thanks for your patience reading this!  Any advice is much appreciated!

Carole

Are plans allowed to pay annual service fees?

Are plans allowed to pay plan termination fees?

Are there any fees that the plan is not allowed to pay?