A participant would like to prepay the remaining semi-monthly payments for the remainder of the year.  Assume 6 months (12 payments) being made in a lump sum right now to cover all payment from 7/15/19 - 12/31/19.

Assume the participant loan program allows for these ad hoc payments and sponsor is OK with it.  Is this acceptable from an IRS stand point or is it a violation of 72(p)?

I realize 72(p) requires level amortization with payments no less frequently than quarterly but this is essentially paying the payments before they are due not in arrears and will not extend the term of the loan just reduce the overall interest paid. But is this a form over substance thing where it can't be done?

If it was just prepaying the next quarter instead of the next 6 months would this be OK?

Plan was amended effective Jan. 1, 2018 and plan was operated in accordance with these amendments.  For some reason, the actual amendment was signed and adopted until April 2019.  Is there an issue and if so how is it corrected?
 

Plan was amended effective Jan. 1, 2018 and plan was operated in accordance with these amendments.  For some reason, the actual amendment was signed and adopted until April 2019.  Is there an issue and if so how is it corrected?

First time I've run into this. At first glance, it appears to be a form of business structure that allows "sub-LLC's" underneath the overall umbrella of the registered LLC. Specific legal requirements, only in certain states, apparently many unresolved or untested tax/administrative issues, blah, blah, blah.

Wondered if anyone had encountered this in the retirement plan arena? Seems like it would be handled rather like a controlled group - that is, everyone in the multiple "sub" LLC's included for coverage/testing, and one or more groups could be excluded assuming you pass.

We would, of course, have them discuss with tax/legal counsel before setting up any type of plan...

Anyone had any dealings with a "Series LLC" in the retirement plan world?

My employment was terminated 6 years ago. 

I'm just now eligible for distribution but now they saying they will pay me in 5 years installments.  So after waiting for 6 years, now I got to wait another 5 to get it all?    Can they do this? 

We currently have 25 DB /CB Plans we outsource.  Fees are going up with the company we work with plus restatement fees so I want to review current relationship.  Anyone work with a quality company for DB/CB outsourcing work?  Outsourcing meaning they provide contributions, valuations and annual 5500 plus SB & schedules.  Thank you.

Hello,

Based on a unique situation that I never experienced before, am trying to figure out what to enter for Line 8(b).

Scenario (with mock numbers but that captures the scenario).

Starting Balance - 300,000

Contributions - 10,000

Dividends/Interest income etc. - 5,000

Ending Balance - 290,000 (there was loss in value of assets in the plan).

So, question is, on Line 8(b) should I enter    -25,000+5000= -20,000, comes from 25,000 loss in assets values and 5,000 income from Dividends/Interest?

Then starting balance of 300,000 plus 10,000 contribution = 310,000 with loss of 20,000 leads to Ending Balance of 290,000.

Thanks,

Is there a way to make some sort of annual company non-elective contribution just to a couple of participants without running afoul of all sorts of discrimination (or other) rules?  The plan I am looking at already makes matching contributions to all participants but does not make any unmatched contributions.  When you stop laughing, let me know your thoughts.  Thanks so much.

Company A is buying Company B in a stock transaction.  Company B participates in a multiple employer 401(k) plan.  In drafting the merger agreement, Company A wants to take on as little liability as possible associated with B's participation in the multiple employer 401(k) pre-merger.  

Company B will be withdrawing from the multiple employer plan and either 1) spinning off the plan assets into a new plan and immediately terminating the new plan prior to the close of the merger, or 2) transferring Company B employees' assets into Company A's 401(k) plan.

Does a transfer of assets into Company A's plan create any more liability for Company A (related to the plan pre-merger) than if Company B's assets were spun off and that plan terminated?

We had an associate pass away with no designated beneficiary on file for the 401k. Per the order of succession in the plan document, the beneficiary is the associate's estate. The beneficiary of the estate is now wanting to transfer the money into an inherited IRA. Can the transfer to an inherited IRA occur because the beneficiary is an estate? If so, would it have to be setup in the name of the estate or can it be setup in the name of the beneficiary of the estate? 

We have a client for whom we are doing a self-correction.  Salary deferrals were not deducted from bonus wages per terms of the Plan plus the applicable matching contributions.  However, an HCE doesn't want to be part of the correction - wants to waive any funds he is otherwise due under the correction measure. 

The question is (1) can we allow this ....have him sign a waiver?  and (2) would this put the Plan in a worse position upon audit for not correcting the failure in full and in accordance with IRS Guidelines.  Is there even a waiver option discussed in the IRS guidelines on correction?  Any thoughts are welcome.

Can a 403(b) (non -church) Plan invest in ETFs?  It is my understanding that some ETFs are considered mutual funds as long as it is a Registered Investment Company under Section 851(a) of the code.  Can anyone confirm with a site? 

Thanks

While reviewing a plan's 2018 fidelity bond, I see that it is $30,000.  Assets reported on the 5500-SF are $305,000 as of 1/1/2018, which includes $250,000 in assets and a $55,000 employer contribution that was not deposited until 2019.  I could ask the client to increase coverage retroactively to meet the 10% requirement for 2018, but is this necessary if the assets actually invested in the plan were only $250,000?

To avoid audit requirement for plan, employer is splitting the plan into two separate plans.  Plan provisions will be exactly the same.  Since the plans have provisions that are identical, can nondiscrimination testing be performed as if they are a single plan?

Hi,

I'm older than 50 and have never made a catch-up contribution to my 401k. Can I make one every year from now on? To make the catch-up, can I simply keep contributing to the 401k weekly as I do now until I reach $25,000?

Hi,

If a plan participant (active, or terminated employee) requests information regarding a qualified DC Plan that a company sponsors.1 Who is required to provide the information, the TPA or the plan sponsor/administrator (ie the client)? 2. Is the TPA prohibited from providing any information since the TPA is not the sponsor/administrator?  Thank you.

Really splitting hairs here, but...

When looking at Appendix A, .05(9) and (10), let's suppose that everyone has been having deferrals withheld correctly, and all of a sudden, for ONE payroll, everyone who is deferring doesn't have anything withheld on a small piece of irregular (but not excluded) compensation.

If corrected immediately, does this qualify for the "no QNEC" correction? (Assume no match anyway)

While it seems reasonable, I suppose one could interpret the language in (10) that this isn't a "failure to implement" - in other words, it seems like that might be designed more for an INITIAL "failure to implement."

Has anyone seen/heard of the IRS addressing this issue?

Suppose we have three members of a controlled group cos X,Y and Z. All three have a standardized prototype profit sharing plan; the adoption agreement states that all employers participate in the plan . Each plan has a different allocation formula, one is prorata, the other fixed and the third integrated. Can each employer X,Y and Z allocate a discretionary amount  to just its employees based on its plan's allocation formula and then general test all the employees together for coverage and nondiscrimination?

One of our locations just closed due to business decision and employees were being let go.

Does this trigger as distributable event for the terminated employees who participated into the plan? Do they eligible to receive 100% of the vested employee contributions even though they did not meet the yearly requirement (20% for serviced after 2 years...... and 100% after 6 years)?

Thanks

Have an existing 401(k) Plan that someone (not me!) added a SH match to effective 4/1.  Obviously this is not allowed.

What is the remedy?

Send a "Sorry that you got that SH notice, but you really didn't need to..."?

Amend the doc to not have the SH features.

Good thing is, there was already a stated match in the plan which was the same as the SHM.

Testing should not be  a problem.