Former client (and someone I'm still friends with)  asked me to look over the mess of the new administrators (rhymes with Daysex).  Plan is a 3% Safe Harbor Non-discretionary.  For whatever reason the 3% has only been allocated to those employees that are deferring.  Last time I checked in on the friend, that battle was still being waged.  It wasn't resolved by the end of 2019 to any extent.  The client is a sole-proprietor with 10-15 long time employees.  So, maybe 12 are still due their SHNDC and the tax return of the Sole-P has yet to be processed. 

So, how does Daysex generate a 5500 for signature when so much is still incomplete?  Does anyone prepare a 5500 before the sole-p's income is known or final contributions receivable are calculated?  It's certain to be in the $60k-$75K range.  I guess, if I'm Daysex, I can say I only report what's on the books on December 31.  Never, ever have I seen this.

Good evening.

Do any of you fellow practitioners have suggestions on where to find the best 457 training for new staff?  I've looked on ASPPA and NIPA and am not finding training designated towards just non-qualified 457 plans.  I would appreciate any suggestions. Thank you.

Business 1 - 401k plan is currently in place - 1 Owner. 

Business 2 - Business Opens another location 6 month later - that owner is the Parent to Owner 1 above.

Can Business 2 just adopt Business 1 plan as an Adopting Employer, since they will create a Controlled Group?   Would there be Plan Amendment needed only for that?

So client asked me to calculate their SHNEC and PS for 2019 earlier this year.  In March they confirmed that they wanted to do both but in April they changed their mind and said they only wanted to fund the required SHNEC.  Apparently they have filed their corporate tax return for 2019.

Today they came back to me and are asking if they amend their corporate tax return for 2019, can they fund the 2019 PS that we had calculated for them and they later decided not to do?

I am having internet problems, so I can't search the EOB.  I will be looking thru the paper copy of the 2018 version while I wait for the IT people to come, but thought I would post the question here too.

TIA

In my divorce decree, my wife was awarded 50 percent of my 401k from the time that we were married which was 12 years. Fidelity qdro gave her 50 percent of my entire 401k for 21 years. How do I recoup my funds for the 9 years before we were married?

In my divorce decree, my wife was awarded 50 percent of my 401k from the time that we were married which was 12 years. Fidelity qdro gave her 50 percent of my entire 401k for 21 years. How do I recoup my funds for the 9 years before we were married?  

Is anyone being asked if a plan can fund a contribution to their terminated participants now since there are so many people being terminated/severed, etc.? It may be a BRF issue that some are benefiting from receiving a contribution now, versus later, but if it impacts only NHCEs... Is it even a possibility to fund some but not all participants?

Employer pays the President's family coverage under group health insurance plan per an employment agreement.  For other employees, employer only pays for employee-only coverage (employees pay for any more on their own.  This clearly is discriminatory under IRC 105(h).  But does it violate the IRC 125 cafeteria plan rule against discrimination as to contributions and benefits?

Can you help with the following scenario:

P sponsors a QRP.  R and P are related employers, and R's employees participate in P's plan.

C and R are brother-sister companies.  

Just by the nature of C and R being brother-sister, does that by default pull C into the ASG with R and P?  Or would C be part of the ASG only if it satisfies the ASG rules on its own?

Thanks.

Opinions please on this unusual fact pattern.  Participant leaves employment with a vested benefit in a defined benefit pension plan in 2017.  Plan provisions permit him to elect an immediate lump sum distribution upon completing the appropriate forms and submitting certain documentation.  One item included in the application package is a Spousal Consent that must be completed by his spouse.  Note: he covered his spouse under various health and welfare benefit plans during his period of employment.

When he received his pension application, he indicated that his marital status is 'single-never married'.  We pointed out that he presented himself as being married during his employment.  He stated that he lied about his marital status and that he was not never married.  We prepared affidavits for him and the person who is not his spouse (PNHS) to complete.  He completed and submitted his own affidavit stating that he was never married to PNHS.  He indicated that he did not have a current address for PNHS.  We performed a search and sent the affidavit to PNHS via regular and certified mail. PNHS never submitted the affidavit, and did not sign for the certified mailing.  The affidavit sent by regular U.S. mail was not returned as being undeliverable.

Participant, of course, is super anxious to receive his distribution. We suggested that he submit an official copy/transcript of his federal tax return from the IRS for the final year of his employ with the company.  Our thought was that it would agree with his true marital status and along with his completed affidavit would permit us to distribute his pension.  Initially he stated he would request and send the tax return, then he stated that he did not file a return for that year/any year.  Recently, he is claiming that we have no authority to request copies of his tax return. 

Any suggestions?

Does the owner of a sole prop need to have current year income to have the Excess Asset from QRP Suspense Account Allocated to him over seven year?

There is some mention of the 415 applicability to limit the amount allocated (see attached).   But I didn't find anything that tells me if an owner of a sole prop needs to have current year income to receive allocation as the case would be if it was not from QRP.

irs_plr_2008-36034.pdf

Wondering,

anyone seeing (or acting on) situations where the 1/1/2020 funded ratio is "high" (90% or above) and the plan sponsor is instructing the actuary not to issue the 2020 AFTAP certification, thus letting the default percentages apply?  Could be useful when (1) the plan allows lump sums greater than $5,000 and (2) the sponsor is trying to save cash in the plan very soon after the assets have taken a dive. 

Any other thoughts on the process? the communication? etc?

Please consider the following facts:

Unclear as to whether the Suspended Loan Repayment Provision would apply to a new loan taken out currently.

Owner wants to allow all legal investments under the 401(k) plan, for all participants. The plan is fairly plan vanilla uses a popular custodian / recordkeeper. The owner wants to invest in some small startup LLCs and wants to use his plan money. Plan has about 40 participants. 

For a whole host of reasons I can think of why this is a bad idea, but I'm not great at articulating them, and don't want to look up citations if I don't have to. 

Does anyone have suggestions for articles, threads, publications that explain why this is such a bad idea? 

There are practical ones - like I don't know if the existing advisor will want to deal with outside accounts. Nor do I know if the pricing at the custodian will change if a large chunk of the assets are moved out. But I'm more interested in things that articulate the risk from a fiduciary and prudence standpoint. 

I have a 401(k) plan with life insurance policies (ugh!, it was a takeover).  One of the participants with a policy is terminated and is age 64.  Is it correct that the plan sponsor needs to either distribute the policy to him at age 65 or convert the policy to cash?  From what I read, if he were still working for the sponsor and not retired, the policy could stay in force.

A couple of questions:

1.  Plan accepts Prevailing Wage contributions and provides that they can be used to offset Profit Sharing.  PW contributions are 100% vested.  Although the plan document allows for  offset,  it doesn't address if those amounts used for that offset can also be subject to the Profit Sharing vesting schedule.  Does the plan document have to specifically allow for the application of a vesting schedule on those amounts that are used to offset PS?

2.   Can someone point me to a resource that discusses this in more detail?  I though that there used to be a Q&A on this site, but I am not finding it now.

Thanks for any guidance.

Does anyone know if you can terminate a Non-calendar year SIMPLE 401(k) plan, I.e. plan year is 7/1 thru 6/30, and start a traditional 401(k) plan in the same calendar year? I know for SIMPLE IRAs they always operate on a calendar year basis but I am not sure about the SIMPLE 401(k). Thanks!

Is there any way for the trustee of a 401(k) plan that is not terminating to legally roll over a large balance on behalf of a missing or unresponsive participant to an IRA?  

Plan Sponsor normally charges annual administrative fees to all plan participants.

Client has changed tpa.  Can same plan sponsor charge the following fees to participants:

• Plan Document restatement by new tpa when the restatement is not a required restatement but just from changing tpa
• 'Transfer fee' by old tpa for providing participant data to new tpa