"In the case of a Former Employee who under the Plan does not have a nonforfeitable right to any interest in the Plan
resulting from Employer contributions, "

Has anyone found a good article from a good source on what this means.  I feel like you need a table with entries for the following:

Eligible for 401(k) but never made any contributions

Eligible for 401(k) but took  a distriubtion shortly after termination

Eligible for 401k and never took  a distriubtion

Eligible for profit sharing but never received an allocation

Eligible for profit sharing and took  a distribution shortly after termination

You ge tthe point.  There is a different logic for each of these scenairos.  Anyone ever see anything that really go through this in detail?

Company A acquired Company B and each have 401(k) plans.  Plans will be merging 12/31/2020.  Company A 401(k) Plan (surviving plan) has immediate vesting for all sources.  Company B 401(k) Plan (merging plan) has a 6-year graded vesting schedule for match and profit sharing.

1. Can the surviving plan continue the 6-year graded vesting schedule for all of the merging match and profit sharing money (active and terminated participants)?  I think this is yes but value opinions.

2. Can the surviving plan continue the 6-year graded vesting schedule for the merging terminated participant accounts while providing 100% immediate vesting for merging active participant accounts? I'm not sure on this one.

3. Can the surviving plan provide immediate 100% vesting for all of the merging match and profit sharing money (active and terminated participants)? I'm not sure why they would, but need to cover all options.

Taking over a plan that is 401k and does not have profit sharing as an option in their current document.  Never encountered this before and we always have the profit sharing as an option in our plans.  Client wants to add PS for 2020.  I believe that is permissible but making sure I'm not missing something.

Hello everyone. The husband just died a month ago and he was employed. The wife already called Fidelity, and they have submitted a form. The wife is not residing in the united states because the husband was just in the process of petitioning the wife when he died.  I wonder how long would it take for the wife to claim the benefits? 

It was discovered that a self-directed IRA has invested in a collectible that does not meet any of the exceptions in Code Section 408(m), and therefore the IRA is treated as having distributed the cost of the collectible to the IRA owner.

Two questions.

1. In addition to the deemed distribution, does the IRA's investment in the collectible constitute a prohibited transaction, or could a prohibited transaction arise if appropriate steps are not taken?

2. Does the IRA custodian have any duty to ensure that the IRA owner correctly handles the deemed distribution, or have a reporting obligation regarding the deemed distribution?

Any thoughts are welcome. Thanks! 

Plan has discretionary match but no allocation conditions (no last day rule).

Plan sponsor now considering making a 2020 discretionary match but wants to amend to add last day rule.

OK or a prohibited cutback for participants who deferred in 2020 but have terminated employment? 

We have a 401k plan that allows for after-tax employee contributions.  The plan sponsor is an LLC that is taxed as a sole prop.  Can the owner deposit the after-tax contributions up until his tax return due date or does he have to deposit those by 12/31?  

Thank You 

I know for Plans with less than 100 people, the DOL requires contributions to be deposited within 7 business days of being withheld from payroll.

I have a multiple employer plan with more than 100 participants, though no single employer has more than 100 employees in the Plan.  So the question is:

• Does the employer need to make the contributions within 7 business days?
• Or, since the Plan as a whole over 100 participants does it fall under the 15th business day of the month following the month in which the amount was received by the employer (so if something was withheld on October 31, I guess that means it's due 11/15?)

Thanks everyone!

Hi, All

not sure where to start my quest? are there any alternative payouts other than QEBA? my STATE pension plan does not participate in QEBA. 
thank you and if I am asking the wrong questions please disregard 

Not my best topic, I may have my terms wrong.

Husband and wife each own their own separate companies.

Wife provides accounting services for husband's business, but does not take a paycheck. Here business is not accounting, it's just that she's the one who's good at numbers. She signs off on documents.

Does this make these two companies one control group, or attribute some kind of joint ownership?

I believe the answer to this situation is no, but thought I'd run this question on here:

Background:  Medical Group, each doctor has own plan. Staff is in a PEO Plan. All provisions and investment options are similar to this longstanding setup that the doctors prefer, and cross testing is run including all of the above.

One individual doctor is asking if she can have a Cash Balance Plan.

A company would like to establish a new Safe Harbor 401(k) plan now (in November) that would fund a 5% Safe Harbor Non-Elective contribution. The plan would be effective 1/1/2020, and the compensation that would be considered for all purposes (including the calculation of the 5% Safe Harbor Non-Elective contribution) would be from 1/1/2020 to 12/31/2020. Is that allowed under the new rules?

Thanks!

Looking at a combo plan design for someone and also having a brain freeze for a change.

3% non-elective SH + PS. Gateway determine at 7.5%

DC plan eligibility is 6 months with the following month as the entry date for all sources.

PS is 1000+ hours and last day rule. Allocation method is each participant is their own group.

I see a terminated employee with DOH 1/1/2020, enters the DC plan on 7/1/2020 and terminates 8/1/2020. They worked over 1000 hrs.

They get the SH but they also need to get the 4.5% PS allocation for gateway, correct? The software is forcing it to be provided.

The plan will not pass otherwise excludible testing.

Thank you

Hi,

Which distribution code should be used for the following distribution? The participant exceeded the 402(g) limit for the year and did not distribute the funds by April 15 of the following year. All of the contributions were with the same company, so the distribution must be processed even though it's after April 15. The contributions that the participant put in were Roth. Since the earnings on the excess should be taxable because it's made after April 15, would the Code be "P", "1", and "B", assuming the participant is under 59 1/2?

Thanks!

I have a 457(b), non-governmental plan that we will answer basic questions for a 401(k) client.  The document was drafted to begin distributions upon severance of employment or at age 70 1/2.  They can choose a lump sum payment or 5, 10 or 15 year installments.  One of the participants asked if he is still working at 70 1/2 and chooses to take a 10 year installment payout, if he retires 3 years in, can his payout be accelerated so that he can take the balance?  The document isn't clear, but there doesn't appear anything that would stop the acceleration.  His financial advisor who worked with them to set this up many years ago has no clue and is asking me.  We don't specialize in 457 plans so I want to ask the experts in this group.  Thanks for any insight you can provide.

One participant plan,  71 year old owner with more than ten years of service and participation. NRA was 65. 3 yr avg pay is $280,000. Benefit is 100% of pay. Distribution will be made on 12/31/20.

Actuarial equivalence of $230,000 limit is about $371,000. Lump sum of $371,000 based on AMT at 5.5% is about $3.8 mm.

But maximum benefit is 100% of pay, or $280,000. Lump sum of 280,000 based on AMT at 5.5% is about $2.9 mm. Lump sum using 417 segment rates is about $3.5 mm.

What is the maximum lump sum for this participant? I’d like to say $3.5 mm, but I’m not convinced. This would not be an issue if 417 rates weren’t so low.

I work for a TPA (covered entity), and our legal office has a disagreement over whether we can disclose to the plan subscriber if an adult child is or is not enrolled on the subscriber's (the parent's) plan. I say that their enrollment information is PHI and we need approval from the adult child. Another attorney says it isn't PHI, and we can tell the parent who is enrolled on his/her plan. Please weigh in.

Lets say there are two controlled groups. Controlled group 1 contains employers A, B and C, and controlled group 2 contains D, E and F. In addition, employers B and E are an affiliated service group. Both controlled groups sponsor a retirement plan with each of its controlled group members. The two plans provide for different benefit arrangements, controlled group 1 is a profit sharing only plan, and controlled group 2 provides only deferrals and matching contributions.

I assume that when testing coverage for controlled group 1 would I need to consider employees of employer E in my analysis. If coverage fails without employer E for average benefits purposes, would I aggregate the entirety of both plans together or would I just include employer E employees into the controlled group 1's plan?

I'm ignoring coverage testing of controlled group 2 because I'm assuming the same procedure applied to controlled group 1 would apply to controlled group 2.

Recordkeeper is requiring a new QACA 401k to add a 2 month eligibility waiting period for new hires so they can distribute notices to them. Is this correct or is it possible to implement a shorter eligibility period such as 30 days? 

Since QACA allows an employee to retroactively opt-out, it seems a lengthy notification period isn't needed, but maybe I'm wrong and the recordkeeper is right. I couldn't find IRS guidance on this.