A participant is over age 73 and has an RMD for 2025. He terminated before NRA and because of that, he is not 100% vested. Is the RMD amount calculated based on full account balance or vested account balance?

Thanks.

I have a Township who currently offers a 401a plan to it's full time employees.  They want to create a plan that offers match, but only for the part time employees - excluding the individuals who are eligible for the 401a plan.  I apologize for my ignorance, but we don't do a ton of these.  I think they can do this...but I would love some confirmation.  

Any guidance or alternative thoughts on this would be very much appreciated.

Thanks!

I'm hearing different things from TPA's regarding whether or not they are making a Student Loan Matching Certification Form available to participants.  Has anyone seen TPA's putting anything together?  I'm also surprised I haven't seen anything from document providers?

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A plan has a 100% match on the first 6% of comp.  If I recall correctly, a formula can be considered safe harbor if you contribute a match only based on the first 6% of comp, but only if that amount is less than 100% of the first 4% of comp.  That would make this match on the first 4% of comp safe harbor, and the match on the next 2% a fixed non-SH match.  Since there's a portion that's non-SH, the plan would be subject to ADP and ACP testing - do I have all of this correct?  Would the ACP testing be done using the entire match or only the non-SH portion, i.e., the amount based on the 4% - 6% of comp? Thanks in advance for any assistance. 

A plan came on with us earlier this year, this is our first time doing testing for them. Owner wants a projection of what it'd look like to max out profit sharing with new comp (they've never done profit sharing before). Right now their plan doc has 3 month wait, no hours or age requirement, and monthly entry for all sources, including safe harbor. Owner has two kids, 12 and 14, which get a small paycheck, defer some, and get safe harbor money. This causes some wild numbers in 401(a)(4) testing because of their age; the $330 of safe harbor received by one kid means I'd need to get 5 NHCEs up to ~27 EBAR. Essentially, there's no way to max out the owner without giving wild contributions to everyone else because of those two kids.

Our plan is to amend their document for next year to either have an age requirement or exclude HCEs from the safe harbor contribution, along with some allocation conditions and other small provision changes to make this much smoother next year. That said, is there anything at all we can do for this year to make this spread better? I've seen conflicting information about the use of statutory exclusions for 401(a) rate group testing & struggling a bit to wrap my head around if there's any way we can make this work. Any input would be much appreciated!

Can someone point me to annual participant notice requirements for 457(b) and 457(f) requirements?

Thank you. 

Our firm has a lot of owner only so we tend to have alot of mega Roth conversions.  I can't seem to find a definitive answer on what the limit is when the plan is ONLY doing after tax -> Roth.  I've read alot of places that if you are 50 and over, then the limit is $77,500 for 2025 but the examples always include deferrals/Roth.  What about when it's solely after tax?  I read an AI response that said if it's only after tax, then the limit is just $70,000 because after tax is not subject to 402(g):  

• Elective deferrals = pre-tax 401(k) deferrals + Roth 401(k) deferrals (salary-reduction contributions subject to the 402(g) limit).

• After-tax (non-Roth) contributions = a different bucket under §415(c), not subject to 402(g), and not elective deferrals.

Thanks!

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A 401(k) participant requested a hardship under 1.401(k)-1(d)(3)(ii)(B)(6), relating to the "repair" of the participant's principal residence, for costs associated with the removal of a tree that posed a danger of falling on the participant's residence (but had not actually fallen yet).  From a practical, policy perspective, I understand that it makes sense for the participant to take the tree down before it actually falls on the house.  However, I don't think this would qualify as a casualty loss under 165, and therefore wouldn't qualify as a "repair" eligible for hardship.  (See, e.g., Rev. Rul. 76-134.)  Do you all agree?  Other thoughts?

(As an aside, I realize that SECURE 2.0 permits self-certification, but in this case the participant volunteered the information, so the plan sponsor has actual knowledge.)

Is there a particular advantage to signing a new Cash Balance Plan for the current plan year by end of the plan year, typically 12/31. 

Or is it just as well to wait until prior to the tax filing deadline of the next year and signing retroactively?

Found a r/k who posts deferral transactions before the check date.  Basically, they process the contribution file when it comes in.

For example, they processed the 5/9/25 payroll on 5/8.

I didn't think they could/should do that, but they said it was ok.

Do you agree?

To help customers apply § 414(v)(7)’s constraint that a higher-wage participant’s age-based catch-up deferral must be Roth contributions, recordkeepers are asking an employer to deliver—in January, following W-2 files—a computer file that shows, yes-or-no or on-or-off, whether a participant had in the preceding year Social Security wages more than $150,000.

Everything I’ve heard so far suggests this is the mainstream method recordkeepers are doing.

Is there any big recordkeeper not doing this?

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Situation: H had an IRA. H died. W survived. She did not rename the IRA into her name as owner. She did not take any MRDs, even for those years she had reached and passed her RBD. W dies. The IRA balance is moved into an "estate account." Then, W dies. Her executor has  the funds in the IRA moved to an "estate account" and then, 1/5th each transferred to five new "inherited IRAs", one each for the five children.

How do we resolve the failure by W to take MRDs?

Were the funds taxable when transferred from the IRA to the estate account (since estates per se cannot be IRA owners)?

If so, is there a stock report I can run?  Do I ahve to get my backend team ro create a crystal report for this?

More questions:

I think maybe I'm asking if there is a rate of return report that can be run with ad hoc dates?

Could it be run on a plan-wide level but with participant detail?

The accounts are daily-valued in the Relius ecosystem.

A small employer offers only fully insured medical insurance to its employees and employees pay their share of the cost of coverage through a cafeteria plan.  One (and only one) highly compensated employee is provided with additional cash compensation for opting out of the medical coverage.

Does this violate the benefits portion of the cafeteria plan nondiscrimination tests?  If so, what is the consequence to the one HCE? 

Thanks. 

I have made the (not all all difficult) decision to retire at the end of this year. I have agreed to work a couple of days a week during the early part of next year to help out my employer while they hire a replacement, but it's a limited engagement. I'll be lurking on these boards for a while yet.

I'd like to take this opportunity to thank Dave and Lois for providing this magnificent resource - it has been a tremendous asset! I'd also like to thank all of you folks, past and present, for the invaluable assistance you have given to me over the years. I've certainly taken more than I've given, and your time, generosity, and expertise is appreciated more than you can ever know. It's not just the technical expertise, but the sounding board for discussions, sometimes griping (misery loves company) and humor in the face of statutory and regulatory foolishness that makes this such a great community.

I wish you all the best in your future endeavors (I'm trying hard not to gloat) as you continue in this business, and I hope you all have a great Holiday season! Take care, and again, a heartfelt thanks!!!