Hi, guys.

I'm pretty sure I know the answer to this question, but just want to be absolutely certain. Is the max contribution to an IRA limit for the calendar year or the tax year? Since you're allowed to contribute in the following year, 2020, up to the tax deadline, that's another calendar year, but it's the same tax year, if it is to apply to the 2019 tax year. In short, can you contribute the max amount by the end of 2019 and then more or even the max again till April 15, 2020, to be applied to the 2019 tax year? I'd imagine not, but I appreciate your confirmation.

Let me tell you the reason I'm asking, in case it makes any difference and such a payment is treated in a different way, which is doubtful, but you never know. I was just laid off and I'll be getting a severance payment. I don't know yet exactly when I'll get it, but it'll be very unfortunate if it happens to be before the end of 2019.

Ugly IRA excess contribution situation over 18 years and potential $400K excise taxes.

Is there a person or department at IRS we could approach to make an anonymous VCP-type application proposing corrective action?

Thanks

We have two MEPs that are merging/terminating. I use both words because that is my question. The MEP sponsor is merging the plans into a larger MEP at another record keeper. There are a few adopting employers who are going to merge into another MEP and one or two who are going to spin off to their own plans. The prior TPA that we inherited this MEP mess from set up each adopting employer with their own plan document and not a regular MEP document with each AE signing a Joinder Agreement.  It has been my understanding that an adopting employer has limited choices when leaving a MEP: spin of and continue the plan, spin off and terminate the plan, or merge into another plan. There are the option because you cannot terminate the MEP. The MEP has a few "orphans"  (i.e. inactive employer) are not transferring to the new MEP. Can the MEP be terminated just like a regular plan termination or do the "orphans" have to be spun off and terminated?  

Hello:

I have a 401(k) Plan sponsored by a Sole Proprietorship that terminated on 12/31/2018.  As part of the process to get all of the participants paid out, it was determined that none of the owner's 2017 401k deferrals were deposited to the Trust.  The owner deducted $24,000 on their individual tax return, and it was reported as a contribution on the 5500 form (and included in all of the necessary testing).  The accountant is asking whether it is still deductible on the 2017 tax return if the deposit is made today (2019).  I'm thinking, from the plan's standpoint, this will be treated as a late contribution and applicable earnings will be deposited along with the $24,000 and the tax return stands as is.  His other option is to amend his 2017 tax return to remove the $24,000 deferral.  Any thoughts?  Let me know if you need more details to provide your feedback.    

I have a plan that uses prior year testing.  Eligibility is 2 month with monthly entry.

For 2018 I tested without statutory exclusions.  I passed the testing for 2018.

I am running a projected test for 2019.  The plans fail the adp/acp test.  In Relius I can select the statutory exclusion " test separately"  box.

Are there any rules for switching between statutory exclusion from one year to another? 

Appreciate your help!

My record keeps is telling me Relius doesn't do coupon loans.  Does the program have the ability to generate a book?

I'm trying to talk a client (a big client) out of having coupon loans.  They don't want to take on the responsibility of taking money out of people's paychecks.

I'm trying to go the "you need to be reasonably sure these loans will actually get paid off, and coupon loans makes this job very difficult" route.

Any other thoughts?

My divorce was finalized in 2004; it included a QDRO.  I recently retired (2018) and after several of the payments I received a letter from the Plan Administrator advising me that the calculations were incorrect ($60,000) and they will be deducting a couple hundred dollars out of my monthly payments.  Now I am stuck!  How can this error happen and I suffer the consequences 14 years later.

Can a non-spousal beneficiary withdraw more than the required amount?   Plan does not allow for partial distributions after termination.  The RMD is about $500 and she wants to take $5,000.     IF she can, would the whole distribution be taxed at 10% or just the RMD amount?    

I have long term disability through my company as well as Social Security Disability. My daughter qualified through me as a Family Supplmental Benefit until she turned 18. We managed to get it extended until she graduated from high school. My company plan subtracted my Social Security and hers from their benefit that was payable to me as an offset. No where in the policy does it address what to do when the family benefit goes away. I notified the disability company when the family benefit ended. Several months later, I noticed on my monthly EOB that they 'quietly' reduced my total benefit by the amount that was paid to my daughter yet they did not increase my payout. So it is a numbers game at this point. I have found on the internet the same situation and the lawyer advised that person that they were entitled to that part of their benefit to be reinstated again. I sent a certified letter to the company recently asking for either an explanation or the back benefit and for it to be reinstated. It has been ignored. My questions are: Am I entitled to that benefit and the back wages? What should I do now if I am? Hire a lawyer? This is a big name insurance company and I worked for a large company. Should I contact others that I feel sure have been done the same way to initiate a class action suit for them also?

We have a client that wants to have us work without their SS#'s.  I know Relius has an Employee ID feature where DERs can be done just with EE#'s. 

Has anyone ever taken this approach? How did it go?  I assume the whole point is to allow us to do the work without SS#'s.  I assume the SS# can be blank?

I realize there will be some inefficiences, but I think I can work around those.  Obviously it's not a 10 person plan so worth a little extra effort! 

Controlled group.  3 companies A B & C.

A does not pass coverage on its own, B & C do.  

I can test A & B together, b/c together they pass coverage excluding C.  C passes excluding A & B.

Can A & B have different SH formulas?  Ie, one a 3% and the other SH Match?

If not, could I have A with SHM plus a discretionary match (that satisfies ACP SH) and B with just the SHM?

If a profit sharing plan terminates do all participants become 100% vested (even terminated participants)?

I have a prototype document that reads service requirements for elective deferrals/profit sharing completion of 1 year of eligibility service.  Hours of service necessary for a year of eligibility service 1,000 (not to exceed 1,000).

Does this mean they have to work a year with at least 1,000 hours and then enter the plan on the next entrance date or they can enter on the next entrance date once they complete 1,000 hours even if it has not been a full year?

Does anyone know if Relius Documents can prepare spanish notices?  I guess I doubt it but curious to know if anyone knows the deal...

Hi!

If you have a Savings Account and there has been established a beneficiary, then I have the possibility to change the beneficiary while this is an active account at the bank.

But if the money has been escheated. How do I reclaim the money without the benificiary getting to know that I'm reclaiming the money? Can I change benificiary while the account is in an escheated state?

Plan year has been April 1 - March 31 for some time, but is then amended for PYE Dec 31. One plan year ended March 31 2019; the next plan year will be short, ending December 31, 2019. For PYE 3/31/2019, what is the deadline for depositing a profit sharing contribution? Does the deposit need to take place by 12/31/2019 (i.e.,  the last day of the following/short plan year)? Or does the sponsor have a full 12 months...until March 31, 2020?

Only asking about the allowed timing. Not about deductibility, comp, or limits on amounts.

Thanks

Participant requests a lump sum cash distribution payable to herself.  It gets overnighted to her and received, but she dies before depositing it or cashing it or whatever transaction she was going to do.

The participant's son wants to deposit it into the participant's checking account to make it part of the estate.  The plan beneficiary (who is the late participant's mother) wants to have the whole transaction stopped and re-processed, arguing that since the check wasn't cashed yet, those are still plan assets and therefore the payment should now go to her as beneficiary.  So I guess this really comes down to when are the assets considered paid out from the plan - when the check is cut from the recordkeeper (which is what it shows when you log into the RK's website), or when the check is cashed?

Any guidance (other than "tell them all to hire a boatload of attorneys" - which is where this might end up, anyway) is appreciated...

If a plan purchases an annuity for a participant to remove them from the plan, does the plan still have to issue a 1099-R? Would it show the annuity purchase amount and that it was not taxable? I know the annuity company will issue a 1099-R for the payments the participant receives, but what about on the plan's side? 

We have a bunch of plans that allow in-service and/or partial withdrawals fall all accounts, whether or not they are fully vested.

Can we amend those plans to allow inservice or partial withdrawals only for fully vested accounts?  Would that be a cut back?