We have a plan that is receiving excess DB plan assets in the Profit Sharing plan.

How do I show that on the 5500?  Other contribution?  Transfer in?

For an insurance company’s fixed annuity contract (or fixed-interest element under an otherwise variable annuity contract), what is a typical credited interest rate?

And for such a contract issued recently, what is a contract-guaranteed rate?

Owner's wife is under age 50, made total of $23K deferrals to SHNE plan. $17K to Roth, $6,000 pre-tax. 

Accountant asking even though Roth is not deductible, can be used to satisfy SHNE contribution.

I don't see how this is permissible as document does not distinguish excess Roth v excess pre-tax.

ABC Co is part of a PEO MEP and they are operating their plan as a 401(k) QACA with a 100% vesting on the first 1% of deferral and 50% on the next 5% of deferral.  Prior to joining the MEP, they never had a plan.   

They have not had a great PEO MEP experience, and have found someone else to take over most HR duties, including payroll.  They want to break away from the PEO MEP as soon as possible.   

They want to keep a 401(k) and simply move the assets over, but make slight changes (like adding loans, in-service, no auto enroll).  They are unsure if they want to keep the same match formula or go to something different, but I think they’re leaning towards something different. 

We’ve reviewed the SPD, but still waiting on other documents.  From the Q&A I've read in ERISAPedia, it sounds like it's very important to review the actual plan document for possible "gotcha" moments. 

They apparently have had issues with the Auto Deferrals and the Advisor has told us that they have removed the Auto Enroll feature at some point in 2020.  We are not sure if they sent notice about that or changed the match feature, but we're assuming they did.  WE don't know if this occurred in the 

They’d like to get this all done in 2020, but we’re running out of time.  We know it would be cleaner to stay in the MEP through the end of the year, and start the new plan effective 1/1/21, but they don’t seem to want to go that route. 

I’ve found nothing in 2020-52 that addresses how the QACA is effected, if the Automatic Deferral feature is removed.

 Questions:

1.   Since they removed the Auto Deferral feature, what challenges are now faced with the discrimination testing (ADP, ACP, Top Heavy)?  Does it have to be done for 2020?  IF so, do we use Current Year Testing?

2.   If it’s determined that we have to do Current Year Testing and fail a test, how do we correct it?  For example, if they fail ADP, do the refunds or QNEC have to be done/made in the PEO Plan?  Or can it be done in the new Plan?

3.  How important is it to review the fine print in the Plan Document to see what challenges are faced with removing itself from the MEP PEO?

A client just asked an interesting question.

If an employee was hired pre-COVID and furloughed/laid off for a spell, when would the initial one year eligibility period start?

Obviously there is no break in service for a non-participant.

Hey, fellow old-time pioneers! You'll enjoy this file.

one-you-will-remember.mp3

2020 plan year is top heavy. Client is discretionary SHNE but cannot afford to fund SHNE or the top heavy minimum. Can the key employees withdraw all of their 2020 contributions (with earnings) in order to bypass the top heavy minimum contribution? I'm thinking this is a big no-no, but would like some proof. If any responses could have some regs pasted in, that would be fantastic.

We have out clients complete a "filing authorization" form every year when we, as TPA, are filing the 5500 on their behalf.

Do we NEED to have one completed every year?  Can we do just one that says Sponsor A authorizes TPA to file on behalf of Sponsor for all years until authorization is rescinded?

I was also thinking that the authorization would be rescinded if the signer of the 5500 changes for any year.

Is there a rule that you have to get one each year?  Link?

Anyone have opinion about filing Schedule D for record keeper plans such as - Hancock, American Funds RKD and Plan Premier, Ascensus, Principal, Nationwide, Empower, Lincoln?  We generally complete this but it seems like a waste of time as most information is on Schedule H.

Most if not all W2s we have received net deferrals from Box 5.  We know pre-tax elective deferrals are added back to Box 5 on W2, such that gross is used for determination of any employer contribution.

Since post tax are already included in gross income (usually Box 1 on W2) of mixed opinion of others, do not increase gross by any Roth deferrals?

Looking a copy of the EBSA Q&A 15 from the 2009 Enrolled Actuaries Meeting (deals with payment of plan expenses).

Thanks in advance.

Hi

If 110k is contributed during 2019 and only 108k is deducted (CPA is not changing the deduction), is the excess 2k considered excess for 5330 penalty or can it be applied towards 2020?

Thanks

TRANSIT EMPLOYEES’ PENSION PLAN (TEPP) 
 
REQUEST FOR PROPOSAL:  TEPP Legal Services 2020 
  
The Administrative Board of the Transit Employees’ Pension Plan (TEPP) is accepting proposals for a firm to provide Legal Services for the Transport Employees’ Pension Plan, a non-ERISA, collectively bargained, governmental pension plan.  Responses shall be prepared in accordance with the requirements. Proposals will be accepted until October 26, 2020 @ 2:00 PM, CST.  The full RFP can be downloaded at https://www.ridemcts.com/business-partners/ebid/tepp-legal-services.   If you have any questions, please contact Carol Noll at cnoll@mcts.org

Hypothetical question which may turn out to be real - don't know yet if it is 401k plan or ERISA 403(b), but I don't think it matters.

Say you have employer A, whose plan has a (pick it - let's say 4 year graded) vesting schedule for matching contributions. (Not a safe harbor plan, by the way.)

Let's say that employer A is going to be involved in starting up a new business, that for now at least would NOT be a controlled group.

The new business B will have a bunch of employer A's employees transferred to them.

Is there a reasonable way to have A's employees who transfer to B, have their vesting in A's plan continue to increase at the normal rate, based on the service with B? Something like: for vesting purposes only, former employees of A who transfer to Employer B will have their years of service with B apply to their account balances in this plan.  Or something along those lines.

I've never seen this done, but curious if it can be done.

Does the CARES act provision for changing health insurance coverage mid-year apply to vision or dental insurance? In other words, in a premium only plan, are these coverages considered "health coverage" for this purpose, or does the revocation of existing health health coverage or electing to now be covered, only apply to "health insurance?"

A client's Profit sharing plan was terminated as of May 31, 2020.  All employees other than the owner were terminated as of 12/31/2019.  He wants to know if he can contribute a final profit sharing contribution for 2020.  If so, do we just need his compensation through 5/31, and can he wait until due date of his return to fund? He has already rolled over his balance that was in the plan to another qualified plan of his new employer - started there in July 2020.  Need thoughts and advice.  Thanks!

Hi

Preparing distribution election forms and not possible to get notarization.

3 participants, father, spouse and daughter.

Daughter owns company 100% and can witness both parents signatures on the distribution election forms.

Father is the president of the company, can he witness his daughter's spouse's signature on the distribution election form?

Thank you

If an employee defers 100% of her pay in a Safe Harbor Match plan, does she have to return a portion of her deferrals to ensure she receives the match or does she not get her match for the year due to the 415 limit?

We have a Davis Bacon plan that excludes HCEs but the owner's children received Davis Bacon contributions within the plan. We have 2 issues, the plan sponsor did not follow the terms of the plan document and, if these contributions are to stay in the plan, the plan will fail 401(a)(4) testing.

If Davis Bacon contributions are irrevocable, can we even remove these ineligible contributions from the plan? Or must the plan go through VCP to retroactively correct the plan to include these HCEs for the Davis Bacon contributions?  

The plan allows for cross-testing using individual rate groups. Assuming the contributions need to remain in the plan, could the plan fund a rather large contribution percentage to a select group of lower-paid NHCEs to pass the test? Although this isn't an 11g amendment, if the benefit is not meaningful under a cross-tested plan, could it be construed as a scheme or abuse by the IRS?

Can a third party service provider file a claim with the DOL for underpayment for services when the plan prohibits assignment except to the extent of payment (e.g., anti-assignment against all other rights but to receive payments)? Can they proceed with a claim when the TPA is alleging that the provider failed to provide adequate information? Any suggestions on where I can look to find more information on third parties and DOL enforcement activity on underpayment claims? Thanks in advance.