The company is being sold with lots of UNallocated shares in the ESOP.  What happens to them?  Are they divided up among the participants?  Or does the new owners decide?  

Plan has up to ~12% profit sharing (after integrating w/ SS) plus a 6% matching contribution.  As a result, after taking into account 401(k) contributions, a handful of participants each year will require a portion of their 401k refunded.

4.04 of EPCRS states:

 A plan that provides for elective deferrals and nonelective employer contributions that are not matching contributions is not treated as failing to have established practices and procedures to prevent the occurrence of a §  415(c) violation in the case of a plan under which excess annual additions under §  415(c) are regularly corrected by return of elective deferrals to the affected employee within 9½ months after the end of the plan's limitation year. 

So I'm ok with this policy, correct?

Proposed regs released for Hardship Withdrawal changes made by TCJA and BBA2018.

Also includes relaxed rules for those affected by Hurricanes Florence and Michael.

https://benefitslink.com/newsletters/2018/2018_11_09_retirement_bulletin.html

We are the TPA firm for an ERISA 403b that has assets with a well known recordkeeper' plan sponsor has an unbundled service agreement with the recordkeeper.

We have a terminated participant who will be due an RMD by 12/31/18 and are being told that only the participant can request the RMD.  Not the TPA, not the plan sponsor.  But, if the RMD is missed, it is the plan sponsor who is responsible and liable for the missed RMD, correct?  If the RMD is missed because the participant either intentionally or unintentionally does not request the RMD, but the plan sponsor requests I, is the plan sponsor still liable?

Is the answer different because this is a 403b plan?

Thanks

A participant with a TEFRA 242(b) deferral election has died with a substantial deferred MRD balance.  He is currently in the middle of a fixed 30 year installment schedule.  (Died after RBD.)  If Spouse beneficiary revokes the installment schedule, this will revoke the 242(b) election.

Question is:  Is Spouse then required to take the make-up MRD distributions of the participant within 2 taxable years, or do the make-up MRD distributions ONLY apply to the MRDs that the BENEFICIARY has deferred AFTER the participant's death?

ERISA Outline Book indicates only the post-death MRDs would have to be made up, but I have not found a supporting reference for this.

Thanks!

Has anyone ever had a plan sponsor do this?  Our standard document doesn't have this option but has a write in section where we could add language.  I've never seen it before but I don't see it being an issue compliance wise.  The plan sponsor can't figure out how to get their payroll system to do both so this was their solution.

Would welcome thoughts on this:  Large 401(k) Plan with significant assets and forfeitures throughout the year has elected to use forfeitures to reduce employer matching contributions and expenses.  Although significant, all the forfeitures can generally be exhausted by covering employer matching contributions except for late in the year forfeitures that administratively aren't fully captured until early in the following year.  Plan uses Relius volume submitter form which provides that all forfeitures should be allocated no later than the end of the plan year following the year in which forfeitures occur.

I'm looking at the ERISA Outline Book and it's references to the Spring 2010 edition of the IRS's Retirement News for Employers.  In that, the IRS says the following:

1.  No forfeitures in a suspense account should remain unallocated beyond the end of the plan year in which they occurred.

2.  No forfeitures should be carried into a subsequent plan year.

3.  For those plans that use forfeitures to reduce plan expenses or employer contributions, there should be plan language and administrative procedures to ensure that current year forfeitures will be used up promptly in the year in which they occurred or in appropriate situations no later than the immediately succeeding plan year.  

So, I generally interpret that to mean you need to use up the forfeitures quickly and apply them to the extent you can by the end of the plan year in which they occur; however, if the plan docs say it is ok, it is generally permissible for some amount of forfeitures to spill over to the next plan year where not administratively feasible to allocate and use to offset matches 100% by end of the plan year in which they occurred (e.g., forfeitures happening in November or December).

Does that seem generally acceptable / correct?

Plan sponsor is asking if it can break with prior tradition and not use any of the 2018 forfeitures to cover matches and expenses in November and December and instead carry full amount (so 11 months of forfeitures) over to 2019 then use in Q1 or Q2 in 2019.  I think some plans do that routinely and not sure the IRS would have huge issue but it seems counter to the general guidance here.  Am I off base?  (Assume that the lagging forfeitures from late 2017 carried over into 2018 were applied to expenses so have been used.)

Thanks

What is everyone using for the PPA restatement effective date? Are you going back to the original effective date because there was no IRS reliance on the prior document?

Any comments are appreciated.

Hi, 

I’m taking a lump sum pension payment, and plan on rolling it to a new IRA account. I already have a different Roth IRA account. Can I still put the max ($6500) into my existing Roth IRA this year, or does the lump sum pension payment max me out for 2018?

Thank you.

The client is the plan administrator for a multiple employer plan, and they currently do not have a good system for administrating forfeitures and crediting the plan adopters on their payroll invoices.

They asked if we could facilitate the forfeiture process and issue a check for the use of the forfeiture balance each quarter directly  back to the adopter in lieu of taking the forfeiture credit  at the time of the contribution with the ER contribution.

Of course the amount to be refunded would be limited to their ER contribution, (but not to exceed the available forfeiture balance).

Will administrating forfeitures in this manner violate the rules of forfeitures being reverted back to employers?

Thanks for any input you have on this.

Client currently has 401(k) with 3% SHNE.

No ER profit sharing.

they want to add a provision for voluntary contributions.

this this allowed and would any testing be involved, and what type?

I have a few questions for those who may use the Ft. William Volume Submitter Profit Sharing Plan With CODA, specifically the one that does not involve a prototype, lead document and adoption agreement.  If you do, please contact me offline at johnsimmonslaw@gmail.com.  Thank you

Someone mentioned to me that a DB Plan that they administered was taken over by a new firm. The new firm is asking the prior administrator/actuary to back up (ie show the calculations for each participant) the accrued benefits for all  participants that are in the most current valuation (7 participants).  Is this something hat is required of the prior Actuary ? Thank you.

A § 401(k) retirement plan provides participant-directed investment (with daily instructions).

The plan’s menu is filled with a broad range of diversified SEC-registered mutual funds.  (Assume these are prudently selected, prudently disclosed, and meet all ERISA § 404(c) conditions.)

Beyond those diversified investment alternatives, the menu for participant-directed investment includes an account that invests in the publicly-traded stock of an operating business.  The account is 1% “cash” (to facilitate transactions) and 99% the stock.  The stock is NOT employer securities.

Assume the plan’s administrator furnishes to participants every securities-law report and other disclosure the stock’s issuer has filed.  (The administrator sends these to participants’ work e-mail addresses and the plan’s website a few minutes after the document is filed with the SEC or the stock exchange.)

Is it enough that a participant can decide for himself or herself to invest in (or avoid) this stock?

Or must a fiduciary evaluate whether this stock account should remain an investment alternative?

If there is such a duty, under what facts and circumstances would a fiduciary find that a participant no longer should have the choice?

I am very new to VEBAs. VEBA holds surplus assets, and accountant determined that it owes a large UBIT.  Can this be paid out of VEBA assets (as opposed to being paid by the company)? VEBA trust document is silent. 

I know the IRS defines a Hardship as "costs relating to the purchase of a principal residence".  The question is what would be included in that?  For example, does the cost of a moving van, etc. fall under that?  Or does it mean closing costs, attorney fees, etc.?

Thanks in advance!

An employer who has both a DB Plan and a 401(k) Plan is terminating the DB plan.  Under the terms of the DB plan, a participant isn't eligible for an in-service distribution until attaining age 62.

Some participants are electing to roll their DB proceeds into the 401(k) Plan.  We know that some features of the DB assets will be retained when rolled into the 401(k) Plan.  Does that also include the in-service provision if the 401(k) plan otherwise permits employees to take in-service distributions at age 59 1/2?

Thank you!

Are taxable fringe benefits such as premiums for group life insurance in excess of $50,000 excluded from comp? 

Does it make a difference if the fringe benefits are taxable or non-taxable?      

 Comp definition is 3401(a) excluding reimbursements or other expense allowances, fringe benefits(cash and non-cash), moving expenses, deferred compensation, welfare benefits, unused leave.     

Non Safe Harbor 401(k) plan covers union and non-union employees.  Match is discretionary.

Is the plan sponsor permitted to make a match for the non-union employees only, so long as they pass ACP testing?

Or would the correct approach be to sponsor two plans.  One for the union yes and one for the non-union

A participant would like to do an in-plan conversion of after-tax contributions to Roth. Which code would be used for this distribution?

Thanks.