I'm thinking time we move from using passwords to secure files to a web based secure file exchange system.  Any recommendations for entry level data exchange (for instance so HR can upload their trust accounting rather than email or fax)?  free?

Wondering if all plans administrators and employers will cooperate and increase loan limits and permit withdrawals up to $100k. this isn’t discretionary is it? 
 

seems to me a bad decision not to allow these withdrawals but just wondering what the consensus is here and when plans will start to integrate the new rules with all the moving parts. 
 

We have more than one small plan with SH match where only the owners defer and so only the owners get SH Match.  They assure us that HCEs have been given the opportunity to defer.  While technically okay, what position are other TPAs taking?

Also, for one of these clients, they have a DB, PS and 401(k); of about 8 participants only the 2 owners (H&W) defer.  The 401(k) excludes HCEs from SH Match, so effectively this allows only the owners to defer with no ADP testing whatsoever.  Again, technically acceptable but.....  Thoughts?

Any adverse experience with IRS running plans this way?

I read somewhere along the way that perhaps you could amend a safe harbor plan to eliminate prospectively the SH for the HCE's and preserve the safe harbor status.

Is that possible?  Anyone looked into that?

I have a plan that is amending to remove the auto-enroll and auto-escalate feature and the service provider wants to take anyone in the plan at the auto-enroll % and make them 0%.  That seems odd and more work for all.  Seems the provider should leave everyone "as is" as this change is only for newly eligible participants.  Does anyone have any information to share on this. 

Physician group - they set up contracts with certain employees to base their overall compensation upon the benefits they will receive in their profit sharing plan (which I'm not fond of).  If the highest HCE rate is 20% is there anyway to give certain NHCE's only a 3% profit sharing contribution based on the employment agreement?  OEE does not work as many our not OEE's.  They also don't want to exclude them from the plan altogether.  Plan is also top-heavy. 

Am I thinking this clearly - Client waived eligibility requirements as of the effective date of a new plan and this brings in an HCE hired on the effective date.  There are 5 other employees hired after the effective date (all NHCEs) who are subject to the plan's eligibility conditions of 1 YOS and semi-annual entry dates.

For coverage purposes we do have 100% of HCEs benefiting and no HNCEs benefiting - coverage failure?  

Or do we consider the total population and consider 100% of HCEs (HCEs hired on or before effective date + HCEs hired after effective date (here no HCEs hired after effective date)) benefiting v. NHCEs benefiting which is calculated as follows:

NHCEs hired on or before effective date / NHCEs hired on or before effective date + NHCEs hired after effective date = NHCE benefiting population 

...and that % must be greater than 70% for this waived service condition to pass coverage?  

I am getting push back that you can have such dual eligibility conditions and there is no need to test for coverage.

Many cities have issued "shelter-in-place" orders for citizens, closing businesses that are not considered essential.  We are having a hard time determining if our TPA firm meets the Homeland Security definition of essential.  We are purely administration, we are not a CPA firm, do not sell product.  Thoughts? 

Thank you

I have been monitoring both the IRS and DOL/EBSA websites to see if any special extensions will be given towards the Form 5500s. I realize that this not a natural disaster such as hurricane; never the less our situation with Covid 19 has brought many businesses to a complete stop. Has there been any hint of a special extension? 

Im curious what other smaller tpa firms (<5 ees) set up for business continuity plans? Customers are starting to ask. If looking to share thoughts more privately, dont hesitate to msg me directly. all thoughts appreciated!

Hi

Have a plan that has 4/15/2020 as the extended 5500/PBGC/SSA filing.

Unless I missed it, so far there is no extension, is that correct?

Thank you and be safe.

Has the deadline been extended for PPA Restatement of DB plans?

Hello,

If someone wants to do an IRA Conversion to Roth IRA, does that mean the taxes are paid at time of conversion for the IRA?  What federal taxes are withheld and I would assume normal state withholding would apply?  Thank you.

Does section 2202 of the CARES Act introduce a brand new in-service distribution category for 2020 coronavirus-related distributions by "qualifying individuals"?  Or does it still require employees to satisfy the existing IRS hardship safe harbors and then provide tax relief to hardship withdrawals that qualify as coronavirus-related distributions?

A plan freeze effective date is 3/15/2020.

Since participants haven’t accrued anything for 2020 yet, my understanding is the accrued benefit is based on  1-1-2020.

  In my case the 204(h) notice date was January 31, 2020 with the following information:

                   Effective for the Plan Year Beginning January 1, 2020, our company Defined Benefit Pension Plan will be amended to freeze Benefit Accruals. All prior accured benefits are not affected, and all actuarial valuation methods are the same.

If you disagree with me, how would you put it in the 204(h) notice.

Just curious if anyone has seen anything dealing with Participant enrollment disclosure and possible implications of different best interest regulations.  Thanks

Hard as this is to believe, this is the first time this has happened. Instead of "manually" signing it for us to file, the "manual" signature on the form is an electronic image of the manual signature.

I don't think this is any problem, yet I'm uncertain, and I wasn't quickly finding any guidance/FAQ's that addressed this squarely. I'm sure there is, but I wondered if anyone knew this off the top of their heads. Thanks.

CARES Act § 2202(b) revises or relieves Internal Revenue Code of 1986 § 72(p) to allow a participant loan up to 100% (instead of 50%) of a vested account.  But I see nothing that relaxes the conditions of a prohibited-transaction exemption under ERISA § 408(b)(1) or IRC § 4975(d)(1).

Both those exemptions require that a loan be “adequately secured”.  The Labor department’s rule (which governs for IRC § 4975 too) requires adequate security and provides “[n]o more than 50% of the present value of a participant’s vested accrued benefit may be considered by a plan as security for the outstanding balance of all plan loans made to that participant[.]”  29 C.F.R. § 2550.408b-1(f)(2)(i).

What should a practitioner say about whether to apply or ignore that 50% condition to a participant’s claim for a loan that otherwise would be proper?

My former employer has a pooled 401k account which issues an annual statement in early Spring. I retired at end of last year and had planned to rollover my money into an IRA in January but discovered that I could not request a distribution until the annual statements were issued. By the time I was allowed to request the distribution the market had tanked and my request was denied. Now I'm told that the company will be doing an interim valuation for all participant accounts including mine. Is this legit?

I have a Owner Only Cash Balance Pension Plan.  Plan was set up 12/28/2018 with effective date 1/1/2018.  2018 required funding was $80,486.  However contribution (made 9/13/2019) was $60,000.  So we have an minimum funding issue out of the gate.  Excise tax filed and paid (I believe).  2019 there is 0 cash flow to fund benefit and will result in another minimum funding deficiency for 2019 (this was known as of September, 2019 so is not COVID-19 related).  Have already reduced the benefit for 1/1/2020.  This Plan should have never been set up and completely fails the permanency requirement.

So my question here is whether 412 funding requirements apply to a disqualified plan?  Can I get the plan disqualified on permanency, terminate it and avoid a 2019 minimum funding excise tax on top of all the other tax?