The IRS User Fee Schedule (Appendix A, IRB 2018-1) does not show the user fee for an application to waive minimum funding and the Rev Proc refers back to 2004-15 which refers back to 2004-8, which shows user fees of $2,290 (waiver <$1M) and $5,415 (waiver =>$1M). It doesn't look like any of these rules have been updated.

Are these still the fees or am I missing something?

Thanks

In thinking about a standard non-qualified SERP plan for a tax-exempt organization (a nonaccount balance plan), would the remuneration under Notice 2019-09 be the same as for FICA purposes?  In general, it seems they would be the same.  Thanks in advance!

If husband at age 70.5 elected a 100% J&S annuity and passed away can the surviving spouse now take a lump sum that is equivalent to her receiving a monthly annuity (ie lump sum of the 7,500 monthly that she is supposed to receive)Thank you very much.

When is a participant permitted to resume his/her 401k deferral contributions following his/her 2018 Hardship distribution 6 month suspension period?  Is it immediately, or, must he/she wait until the Plan's next permitted "change", e.g. if Plan permits Quarterly changes, must he/she wait until the 1st of the next quarter following expiration of the suspension period?

Plan provides 6 mo suspension

Plan is SH401k

Plan provides the Participant must complete a new election following the 6 mo suspension bc the election is deemed to be zero at the point of Hardship distribution.

Generally speaking Participants may commence or change their deferral elections Quarterly (jan 1, apr 1, jul 1, oct 1).

Thank you!

Non-profit organization has two full-time employees in management positions, neither of which is highly compensated. 

They also have nurses who are on-call and will receive $2-$4 per hour for being on-call.  Each nurse is on-call 24 hours per week, which means a nurse would have 1,000+ in a year just for on-call time.

A nurse may be called in on a case, and would be paid regular hourly compensation (at a nurse's regular pay rate) for those hours.

The question is whether a 401(k) plan can exclude the on-call time and pay for eligibility, participation and contribution calculations.

Thanks!

We have a realtor who is an LLC and files as a sub-S. Spouse is an attorney, PA with 5 employees, Would the realtor LLC be able to qualify as a SLOB and adopt a defined benefit plan?

I don't think it is but wanted to make sure, as I couldn't find a thread on this.  Company A, which sponsors a 401k plan, is owned 80% by Joe and 20% by Mike - only Joe is employed by A.  Mike also owns 100% of company B, and although both companies frequently work together for a common client, they would not be considered ASG members as they are in the construction biz., and therefore, not service orgs.  Would an ASG situation exist if Mike were to become an employee of A without anything else changing?   

How long must a TPA of NQDC plans retain records for a terminated client? Is 7 years the norm? Can it be a shorter time period? What are general guidelines typically followed by other TPA firms for records retention related to NQDC plans and terminated clients?

Here is an interesting situation: The IRS , during an audit of a 401(k) Plan, has informed the plan sponsor that they were using the incorrect definition of compensation in withholding from eligible employees. They are requesting that the sponsor go back to 2002 to make the appropriate corrections. Here are the two questions that have arisen:

The plan sponsor no longer has the payroll records back to 2002, but does have the compliance testing from their TPA (who is no longer in existence). They are wondering if they can use the compensation information from these tests in order to perform the calculation, informing the IRS that this is all they have and it's their best estimate as to the amounts due. The plan sponsor is doing the corrections on their own.

Second, during this whole thing, the plan sponsor went bankrupt in 2001, and emerged from bankruptcy in 2005. They are wondering if they could be responsible for the corrections during a period of time where they were bankrupt.

If anybody has thoughts on this, I would be interested in hearing them. Thanks.

Plan sponsor is getting push back from new TPA about having the plan added as an additional insured to TPA's E&O Policy. According to TPA, the insurance broker does not permit the plan to be added as an additional insured.

Any thoughts on whether this is common practice?

My understanding is that when cross-testing, any nonhighly compensated employee must receive the minimum gateway when he/she receives any employer provided benefit or non-elective contribution.

Suppose a company sponsors a cash balance plan and a 401(k) plan which are cross-tested together.  If an NHCE receives no employer contribution in the 401(k) plan (last day requirement) but does get a CB plan pay credit that equates to a 2.5% allocation rate, must he be provided the additional contribution to bring him to the (in this case) minimum  gateway of 7.5% ?

Thanks.

Hi to all,

We have a client who has not provided sufficient data to enable us to produce an annual report or a 5500 since 2014.  Please don't go into the fact that we should have fired the client long ago.  There are extenuating circumstances.

The bottom line is that they have seen the light and have begun to provide data.  We are now in a position to provide them with a 5500 to file for 2015 and 2016. Since they are not under examination at this time, we can use the DFVCP program.  From their instructions it would appear that we are supposed to file all delinquent years at one time.  However, we are nowhere near being ready with 2017's form and may not be for several months.

What are your thoughts on waiting a few months and doing them all at one time versus filing what we do have and doing another submission later on?  What if they do get a letter saying they are under examination in the interim while we are waiting to get the 2017 form done?  

Your ideas are appreciated, as always.

Hello,

A plan sponsor has DB and DC plan.  Eligible compensation for deduction limit is $500K.

25%=125K, 6%=30K.

DC ER contribution is 40K, in order to pass 401a4 (over 6%).

DB MRC is 200K as of the valuation date.  I am confused what the deposit amount and the deductible amount are.  My understanding is...

Deposit amount - 240K (DC 40K, DB 200K), Deductible amount = 230K because the DC amount over 6% cannot be deducted??  If the DB deposit is made after the Val Date, would the deductible amount increase accordingly?

Am I close or totally off.....  Is there a way that a sponsor can deduct full 240K, if the increased DC contribution is due to the failed 401a4 test (I think I read this in one of the posts......but not sure how it works with the actual deduction amount).

Thank you in advance.

Good morning to all.  A client passed away last fall, and her sister popped up recently claiming to be the executrix of the estate and heir to all of the client's assets.  

We as the TPA do not keep beneficiary forms on file for any of our clients.   We inform them at the moment of engagement that they must be responsible for keeping up with the forms in their own offices in the employees' personnel files or something similar..

The sister of the deceased says she has not found a beneficiary form.  She says the deceased was divorced and that the ex-husband is deceased, and that they had no children. 

So far all she has provided to us is a death certificate for the deceased and a "Letters Testamentary" document with one sentence naming her as the personal representative of the estate of the deceased.  She is now pushing to have the deceased client's assets transferred to her.  The account balance of the client is held in an individually directed brokerage account with a well-known national brokerage house.

The plan document says that in the absence of a beneficiary form, the assets go first to the spouse, and if none, to the children, and if none, "such other heirs, or the executor or administrator of the estate, as the Plan Administrator shall select."  Bear in mind that the Plan Administrator was the client, who is dead.

1. To what extent are we as the TPA responsible for determining that the spouse is indeed an ex spouse, that he is indeed deceased, and that they had no children?  

2. Is more paperwork required that just this one liner naming this woman as the personal representative of the estate required to establish her as the executrix/personal representative?

3. Is this our problem or the brokerage house's problem that holds the funds?

4. Do we have to worry about being sued later if she lied to us and there is a current spouse/children?

5. Can the account be rolled directly to her without passing through the estate in this circumstance?

This is a first for us, so any experiences you can share/advice you can give will be greatly appreciated.

Thanks in advance.

What is a controlled group? and when a plan be considered a part of the controlled group? also can a plan which part of the control group Terminate?

Plan Sponsor of 403(b) is a tax exempt org.  They want to make very large employer non-elective contributions.  The question is not about the individual limits that apply to participants.  The question is "does the Sec 404 deductibility rule apply to a plan sponsor who does not have tax deductions?"

PS... the Sponsor is actually a non-electing church.  Would the answer be different than a 501(c)(3) org.?

Thanks!

PNJ

Basically a ridiculous academic question, although I suppose it might have some applicability in the future for some sort of required amendment that pertains to all plans.

In these days of mostly pre-approved DC plans, suppose there is a required amendment, let's say something like the DOL disability regs or whatever, that is adopted by the document sponsor on behalf of all clients. It requires an SMM.

Is an SMM legally required to list the Plan and Employer name? Clearly the SPD must do this as per the DOL regs, under 2520.102-3. But I'm not certain that this specific requirement pertains to the SMM, as this information isn't changing - I didn't find, on a mid-level look, where it is specifically stated. Didn't use the fine-toothed comb. If not legally required, it could facilitate a "generic" mailing to all clients.

At best, I think it is foolish not to include plan and employer information, but is it ever an option not to? Curious as to any opinions on this.

Background

A participant in a 403(b)(9) retirement plan has requested a distribution.

·    The participant is a US citizen

·    The participant lives in Peru.

·    The funds would be wired to a bank account in the US.

·    The retirement plan has his SSN on file sourced from both his enrollment app from years ago and his recent withdrawal request form.

Questions:

1. Because his SSN is on file and he indicated on the withdrawal form he is a US Citizen, is there any need for the plan to require receipt of a W-9?

2. If the participant was requesting the funds be delivered outside the US, would there be a need for the W-9?

TIA for your responses.

We have a participant that recently took a loan and is now going out on maternity leave.  Is there any special regulations regarding repayments while she is out or if no repayments are made does she default?

I have read, "a 403(b) plan that provides for employer contributions cannot be a non-ERISA 403(b) plan."

Can a church plan, which is an ERISA exempt and non-electing 403(b) plan, provide for employer contributions?

If so, how is it that the two statements conflict? Any helpful cites?