I have a situation where Company A started  401(k), contributed, took loans, and then Company A went bankrupt. Although the business is closed the 401(k) maintained active status to avoid loan default and classification as taxable income. 6 months later the same owner started another business, of the same industry type, and 3 of the same employees. A new 401(k) was opened and the owner requested to transfer the loans into the new 401(k). Because this is a same owner with a request to transfer assets, is this a successor plan or new plan with rollover? Thank you for any input. 

Hello! I have a plan who did not included bonuses in their compensation for the last 2 years. There are 5 owners and 1 non-owner.  Too late to do anything about it now?  Their allocation is comp-to-comp. Can I make up the difference in what they got and what they should have gotten, so they can claim on their taxes this year as long as that, and their 8/31/2018 contribution, don't exceed the limit? Thank you in advance!

If a plan sponsor wants to amend the floor-offset provision out of their calendar year CB plan, would that be a straightforward as using the 12/31/18 year end hypothetical account balance with offset as the 1/1/19 beginning balance and going forward without the offset?   

We terminated a profit sharing plan in 2016, submitted an LOI to the brokerage firm.  One of the participants could not be located, and we asked the firm to have the check payable to an eligible rollover institution that handles lost participant accounts.

The investment firm followed all instructions but the one that was to be payable to the firm that would open a rollover for the lost participant.  

They wrote the check out to the client, and the client deposited the check into his corporate checking out and had totally forgotten about it; we have told him more than once to get the check reversed, but he has done nothing.

The accountant recently advised the client a final 5500 can now be filed as there is $0 in the plan.

This would be nice, but does not pass my smell test.

One my plans is under CPA Audit and the auditor doesn't like that they don't automatically re-start 401k after 6 months after a hardship distribution.

Is an employer required to automatically re-start 401k for a participant after 6 months? Can they require that the participant fill out new election paperwork?

• Situation where 3 employers in a controlled group all have their own safe harbor match plan. 
• The formula is the same for all 3 plans.
• Definition of compensation will be different for one of them (not safe harbor definition - 414(s) comp ratio testing needed ... I'm going to refer to this as Plan 1), while Plans 2 and 3 just use 415 compensation.
• It's possible participants will be in multiple plans in any given year.

I've read/researched too much about it today and would like some input at this point as I might start overthinking everything. When it comes to 414(s) testing, a couple questions come to mind-

1) When running 414(s) testing for Plan 1, if there are any participants that were with one of the Plan 2 or 3 during the year, would those participants ratios be calculated using: Plan 1 eligible comp/All compensation earned from any employer in the group?

2) Would 414(s) testing be required for Plans 2 or 3 if there are any participants in either that also participated in Plan 1 (assuming their compensation from Plan 1 employer is not eligible in Plans 2/3)?  If all plans had the same definition of compensation, would this change anything?

3) Does being able to pass coverage separately (not requiring aggregation) change anything regarding 414(s) testing?  

Thanks for your help!

Any thoughts on whether the IRS considers the average rate of return for the plan as a whole a reasonable rate to use to adjust earnings on corrective contributions for missed deferrals?  The plan participants had made investment elections, but employer wishes to avoid that level of complexity.  Most participants are NHCEs. 

It seems that many service providers advise clients to use this approach. Any thoughts?

Say you have a PS plan with each participant in his/her own group for allocation purposes and you want to run average benefits testing.

I'm aware of the apparent IRS position that every participant in their own group is not a reasonable classification because it may have the effect of excluding an employee by name. I understand that position if the employer is allocating completely individual rates, including some zeros, with no consistent objective basis (e.g., we like Ann so she gets 5%, but we don't like Ben, who does the same job, so he gets 0%). 

However, if the actual allocation itself is still made on a reasonable, objective, business-criteria basis (and the group is nondiscriminatory) can you use ABT? 

For example, an employer has two locations and every participant works at one or the other, say Florida and California. The plan says every participant is in a separate group for allocation purposes. The employer makes the "official" allocations individually, but everyone who works in Florida gets the same percentage allocation, and everyone who works in California gets the same percentage allocation. 

Is this still a reasonable classification for ABT purposes despite the plan document saying everyone is in their own group for allocation purposes? 

In other words, do the "reasonable classifications" for ABT testing need to be explicitly stated in the plan document, or are the "reasonable classifications" based on actual practice?

It's Monday and my brain isn't working today. Basic admin 101 question. Plan compensation is is based on when participant enters plan. For the purposes of allocating a profit share contribution, does one use compensation based on the entire plan year or the one from when the participant enters the plan?

Code C Purpose: "Use this code for a participant previously reported under the plan of a different plan sponsor and who will now be receiving a future benefit from the plan reported on this form. Also complete columns (b), (c), (h), and (i)."

So a client is merging Plan A into Plan B.  Plan A happened to be an employee contribution only and Plan B happened to be Employer contributions only.  Both are sponsored by the same plan sponsor.  Based on the instructions above, I am planning on NOT reporting these folks as a Code C on the surviving plan.

Do we all agree?

I've been tying myself in knots on the math trying to compare the cost-sharing implications of switching from a Cadillac health plan to a higher deductible plan w/ an integrated HRA.

The former is a family plan with a standard deductible of $0, no coinsurance, and a max out-of-pocket of $3k/$6k (per person/ per family).

The latter has a standard deductible of $3k/$9k, no coinsurance, and a max out-of-pocket of of $5k/$10k. Copays are naturally a bit higher & the plan is obviously more restrictive all around.

If one of the goals is to minimize cost-shifting to employees, how would you go about determining the appropriate HRA contribution amount?

My current thinking is that this should be based simply on the increase in the max out-of-pocket i.e., $4k ($10k - $6k). But I'm being thrown off by the much larger increase in exposure from the high deductible ($9k vs. $0).

I understand that comparisons will vary depending on total medical expenses, the number of visits, procedures, etc. & should also account for the employee's savings from lower premiums. So it's complex. But I'm hoping someone can help clarify my thinking and perhaps add some insight on how best to approach this.

Many thanks in advance.

Plan sponsor had late deposits of elective deferrals for multiple pay periods in 2017.  Due date for Form 5500-SF and Form 5330 were extended by filing Form 5558; $19 was paid with extension for amount due on Form 5330.  After preparing Form 5330, excise tax total is $19.21.  Is it necessary to remit $0.21 with the form?  Is there some kind of de minimis that would apply to this situation?

Thanks.

Company started in July 2018. For a calendar year plan, we will have a 01/01/2018 effective date. Do we have to pro-rate the TWB if using imputed disparity to pass the general test?

Client wants to set up 3 pools of money: Conservative, Moderate and Aggressive. The udnerlying securities will be stocks and bonds.

Has anyone figured out how to handle fee disclosures on this?

Note that we will be doing quarterly valuations, and participants can choose to switch quarterly. And it's a small group, almost exclusively investment experts. They're not really worried about would happen if the market tanked kind of a thing.  Maybe they should be, but they know their employees well.

[i.e., what I am really interested in here is the fee disclosure requirement].

ERISA § 411 makes it at least improper for someone convicted of any of a long list of crimes (if the conviction or the end of the imprisonment, whichever is later, is in the past 13 years) from serving in any almost any role regarding an employee-benefit plan.

Does an insurance company, before issuing an ERISA § 412 fidelity-bond insurance contract, do anything to check whether a person whose dishonest act the contract would insure lacks a disqualifying conviction?

My intuition tells me that the size and probability of an insurer’s potential liability on a typical fidelity bond is so small that an insurer doesn’t bother checking anything.

But I’d like to be wrong about that.

Can anyone tell us what an insurance company does?

Plan definition of pay is 3401(a) wages, excludes excess GTL, ALL fringe benefits, expense allowances, etc and commissions.

We need to run a 414(s) test due to the commission exclusion.  When calculating each participant's compensation percentage, I will put commissions in the numerator but what is in the denominator?  Specifically, must the denominator include the excess GTL and fringe benefits or can those be excluded from the denominator?  I am thinking I would exclude them since they are not part of plan compensation and  are allowable safe harbor compensation adjustments.  Is that correct?  Thanks! 

We have a PSP with owner-only as plan trustee.  The trustee died many years ago; one of the employees of the company bought the business after his death.  

The trustee did name the new owner as trustee of the plan, but no one can find that resolution, except that a corporate resolution naming the new owner was prepared and the new owner signed as employer and trustee.

The plan is funded with a pooled annuity and a small sum in a trusted bank account.

The annuity was surrendered, all but two were paid out as they terminated employment.  They both received their RMDs prior to rollover.

The bank has been giving the trustee and his attorney a hard time releasing the funds from the checking account saying basically, that they does not and will not recognize the current trustee as trustee because he has not presented the "proper" paperwork naming the successor trustee.

The plan document states the beneficiary (wife) is to be the trustee in the event no trustee no trustee can be found. DATAIR doc.  The bank will not even accept this as proof; the plan has been updated each time, GUST, EGTRRA and PPA with the new trustee.

In lieu of digging up the original owner/trustee's burial plot, I would think getting the DOL involved might be the only solution at this point.

5500 fillings are up to date.

Suggestions?

For a 2017 calendar Plan Year, what is the latest possible date to adopt a corrective amendment to permit early entry for an employee that did not meet eligibility (non-highly compensated)?

A profit sharing plan allows for participant-directed investments only for rollover accounts, all other amounts are pooled.  The only participants with ROs are a majority owner and an NHCE, and they have chosen to invest their RO balances in employer securities (company is privately held), which the plan allows (FT William doc).  They now would like to sell their employer securities to a financial advisor who assists with the appraisal of the stock and were wondering if this could somehow be legally accomplished without it being considered a PT.  If these participants elect to change their RO investments to cash and get out of the stock, could the plan then sell it to the FA?  When the plan was first set up (but before this stock sale was considered) FT William indicated that transactions involving the stock would generally not be considered PTs because it is not publicly traded stock and, therefore, not qualifying employer securities.  It seems that 407(d)(5) can be interpreted that way but I would like to be sure.  I can't say I have ever come across such a situation and would appreciate any guidance offered.  

Like to say I am new to filing Form 5500's please bare with me as you may see a lot of questions come through from me. 

I have a client who has a WRAP document in place and they have a carrier that has provided me with 9 different Schedule A's due to different policy numbers.  Am I able to combine any of the Schedule A's or do they have to be inputted separately?

I look forward to everyone's response.