We are trying to create a custom RMD report that will list Participant, SSN, DOB, DOT, 5% Owner (Y/N) and Account Balance.  I am using one of the 70 1/2 Detail reports and I've added the fields for DOT and 5% Owner. 

I've inserted a sub-report to pull in the ending account balance, HOWEVER, it is pulling in information that is not in Relius.  In my subtotal there are funds reporting a balance that have NO balance.  It is including the correct balance for the funds that do have a balance, but NO idea where the other numbers are coming from!!!

Is this possibly a database issue or a subreport linking issue?  I don't have to use the subreport if any has suggestions for getting my ending balance onto the report.  I am a novice (which is generous) but nothing I've tried is working - with or without the subreport. 

PLEASE HELP!! :)

Client elected to make a matching contribution for this current plan year.  The prior plan year, the client chose not to contribute a match. 

Plan uses prior year testing.  I believe that since the prior year match rate for NHCEs was 0%, all match received by HCEs this year needs to be returned due to a failed ACP test.  Do you agree?  Note that this is NOT the first year of the plan's existence, nor the first time that the client is contributing a match.

Employee A was hired on 12/19/2017 and terminated 1/3/2018.  He was subsequently rehired on 6/1/2018.

Plan requires 2 months of service for deferrals and 6 months of service for employer contributions with monthly entry dates.  No minimum age requirement.

Is Employee A eligible for plan on his rehire date of 6/1/18 for deferrals due to the service spanning rule?  And therefore eligible for PS as of 7/1/2018? 

We have a 401(k) Plan that defines Compensation as Section 3401 comp, excluding:

• 414(s) Safe Harbor Exclusions
• Differential Wage Payments
• Stock-related compensation
• Nonqualified deferred compensation payments

We currently have an "award" system, where employees can receive "points" from others for recognition of job well done.  They use the points to purchase items from a catalog.  My questions are:

1) Is this included in Compensation for the 401(k), or can it be excluded as a "fringe benefit"?

2) If it is included in Compensation, can we amend the plan to exclude it?

3) If we amend the plan, can that be done mid-year?  Do we need to send out notices?  Any nondiscrimination testing issues?

A good sized player in the 401k market sent this letter to my co-worker in July 2018.

Actual language.

"What is happening?  In an effort to add extra security to the handling of your private information, your quarterly statement will be available going forward in electronic format only.  Switching to electronic transmission of these statements allows us to become more digitally based and environmentally conscious with our paper usage, and provides quicker access to past statements.

What does this mean to you?  You will receive a notification to the email address saved in your profile whenever your new quarterly benefit statement is available online.  This notification will contain a link to the login page of your account.  Please note that if you were already receiving your statements online, there is no charge, and that electronic delivery does not automatically apply to any other plan information, which you have the right to receive in writing.  If you are interested in receiving other plan communications electronically, please follow the instructions found in the e-documents section of your account.  There, you can select all of your other paperless preferences.

What actions should you take?  We strongly encourage you to visit the plan's website at ...., where you can view, print, or download your current and past statements, utilize insightful reports and financial tools in addition to seeing your other important account information.  To ensure the statement notification goes to the correct address, please take a moment to log into your account and view the account summary to verify that your preferred email is saved to your profile.

If you have any questions or concerns, or would like a paper copy of your quarterly statements, do not hesitate to contact one of your plan's Customer Care Representatives at .....

FAB 2006-03A"

Electronic format only?  Anyone else doing electronic format only?  I'm aware of participants being able to request electronic format only, but a full plan level change to it?  It's like a negative election quarterly statement if you wanted paper.  FAB 2006-03A mentions that paper statements can be requested for fee of charge.  This provider is still offering paper, you just going to have to work to get it.

I'm surprised, and yet, not surprised by this action.  Figured we would end up there anyway.

Any thoughts on this?

Needing information regarding employees that are allowed to advance on their earnings.  What to do when the employee has over advanced and will be negative or "in the hole."  This is problematic within the Transportation Industry.  At this time, do you suggest that the employer should honor the elected deferral or take whatever earnings are available to cover that advance debt?  We have a qualified Plan that allows both pre and post tax deferral.  This trips me up every week!

The way I read the regs and all the guidance, including the IRS publications, and even Natalie Choate's book (which is wonderful, but I could not find where it addresses these questions), if a beneficiary rolls over the Roth 401(k) of a deceased participant to an inherited Roth IRA, and at death the participant did not meet the five-year rule, the following are the tax results. 

1.  The rollover is not taxable.  

2.  A new five-year holding period starts for the beneficiary's inherited IRA. 

3.  We don't worry about 59 1/2 because the distribution was on account of death.  

4.  The only way the beneficiary can avoid taxation on the earnings is to meet the 5-year holding rule.  If the 5-year RMD rule applies to the inherited Roth IRA, then all earnings will be taxed, including pre-rollover and post-rollover.  

I read a website that suggested a non-spouse beneficiary cannot roll over a 401(k) Roth that is not a qualified distribution, but I don't think that is correct.

Finally, if the beneficiary rolls over a Roth 401(k) that is qualified (because the participant had the Roth 401(k) for five years), the post-rollover earnings are still subject to a new 5-year holding period.  

This is all very confusing and the guidance is not clear.   Does anyone have thoughts on this?  

is a fund change notice to participants required when the share class is being changed due to action by the fund board of directors. expenses will be lower.  

I have a client who got a substantial package from them analyzing their plan unrequested. Has anyone seen this before? Is this just marketing?

Just to be clear, I'm not suggesting there was anything inappropriate about it. My client was just surprised by the sheer size of it and it's customization to their plan (which appears to have been done based on 5500 data).

I am a 401k TPA.  I have a client asking about setting up a cafeteria plan for medical expense and dependent care reimbursement.  Do the employee contributions have to be in a segregated account and payments made from it?

thanks!

Perhaps this has been discussed here but how would one go about determining whether an entity is a governmental instrumentality or agency? 

For example, lets say several counties joined together to create a nonprofit authority to oversee solid waste removal or establish a nonprofit rural transit authority. What should one look at to determine whether either of these authorities could sponsor a 401(k) or would be stuck using a governmental 401(a) only plan?

I thought the whole idea of inherited IRAs for non-spousal beneficiaries was the participant's beneficiary could roll the money over, e.g., from a 401(k) plan, to an inherited IRA.  Then, instead of being forced to receive the distribution from the plan under the plan's terms, the beneficiary could stretch out the payments under the Inherited IRA under the more friendly provisions allowed under the RMD rules, as opposed to the plan's rules.  For example, if the plan requires an immediate lump sum distribution on the participant's death, the non-spousal beneficiary could roll the money to an inherited IRA and take the money over the life expectancy of the beneficiary.  

Now that I re-read Notice 2007-7, Q&A-19, it seems the inherited IRA is required to follow the RMD rules that were in the plan from which the distribution was made.  Is that correct?  Thus, for example, if the plan requires the distribution to be made under the five-year rule, and doesn't allow for payments over the beneficiary's life expectancy, the inherited IRA must follow the 5-year rule.  Is that correct?

I am dealing with a Roth 401(k), but I don't think there is a difference between a pre-tax 401(k) or ROTH for this purpose.  The Roth 401(k) is subject to the RMDs and a Roth IRA is subject to RMDs at the participant's death.  

An error was made in a plan document, which resulted in the omission of a year of service requirement for matching contributions. Client is asking to submit VCP filing asking IRS to approve a retroactive amendment, or to approve the calculations for making up the missed contributions. Can you submit alternative correction methods in one VCP filing for the same error? Essentially, "if not this, then that"? Thanks.

Plan uses a pro-rata allocation and has three participants

The total eligible plan compensation for the three participants was $496,580

404 limit for the year is 25% of that or $124,145.

The employer deposited $124,140 to the plan which is just under the limit

Two of the employees are HCE's and

EE#         Comp                    PS Cont                PS Percent                                                         

EE1         $200,728              $53,000                  26.404%   - capped at 415 limit for 2016

EE2         $228,800              $53,000                  23.164%     - capped at 415 limit for 2016

EE3         $67,052                 $18,140                  27.054%    - got a higher % because other two capped.

Total      $496,580              $124,140

                25%

Limit      $124,145

First the auditor tells me no one could get more than 25%.  Then IRS auditor is arguing that because it is a pro-rata formula all three have to get the same percent - especially EE3 who got the extra amount to allocate the full deductible contribution.

It is my understanding that the contribution formula which in this plan is discretionary defines the contribution amount - which in this plan they wanted to take the full 25% deduction.  Then you have to follow the allocation formula which is pro-rata so you have to allocate pro-rata but only up to the 415 limit and they any extra contribution could go to the participant who has not hit their 415 limit.

So in essence they allocated a 27.054% contribution to employees but the plan had to limit the two HCE's to the $53,000 415 max.  Is this incorrect?  If yes please let me know.

For 2017, the filing deadline for a C Corporation was moved to October 15, 2018. Did that also move the deadline for making a contribution for 2017 to October 15?

Hi, I’m sending in our individually designed 401k plan document to the IRS for approval using forms 5300 and 8717. Form 8717 has instructions for finding determination letter fees, but the web sites are not valid. How can I find out the fee that applies to our plan (we are not exempt from fees because we do not have a non-HCE)?  Thank you.

apparently the Italian branch of the Poje family (ha ha ha) helped recover the painting

In the Autumn of 1913, two years after the Mona Lisa was stolen, a well-known antique dealer, Alfredo Geri, innocently placed an ad in several Italian newspapers which stated that he was "a buyer at good prices of art objects of every sort." 

Soon after he placed the ad, Geri received a letter dated November 29 (1913), that stated the writer was in possession of the stolen Mona Lisa. The letter had a post office box in Paris as a return address and had been signed only as "Leonardo."

Though Geri thought he was dealing with someone who had a copy rather than the real Mona Lisa, he contacted Commendatore Giovanni Poggi, museum director of the Uffizi (museum in Florence, Italy). Together, they decided that Geri would write a letter in return saying that he would need to see the painting before he could offer a price.

Another letter came almost immediately asking Geri to go to Paris to see the painting. Geri replied, stating that he could not go to Paris, but, instead, arranged for "Leonardo" to meet him in Milan on December 22.

On December 10, 1913, an Italian man with a mustache appeared at Geri's sales office in Florence. After waiting for other customers to leave, the stranger told Geri that he was Leonardo Vincenzo and that he had the Mona Lisa back in his hotel room. Leonardo stated that he wanted a half million lire for the painting. Leonardo explained that he had stolen the painting in order to restore to Italy what had been stolen from it by Napoleon. Thus, Leonardo made the stipulation that the Mona Lisa was to be hung at the Uffizi and never given back to France.

With some quick, clear thinking, Geri agreed to the price but said the director of the Uffizi would want to see the painting before agreeing to hang it in the museum. Leonardo then suggested they meet in his hotel room the next day.

Upon his leaving, Geri contacted the police and the Uffizi.

The Return of the Painting

The following day, Geri and Poggi (the museum director) appeared at Leonardo's hotel room. Leonardo pulled out a wooden trunk. After opening the trunk, Leonardo pulled out a pair of underwear, some old shoes, and a shirt. Then Leonardo removed a false bottom -- and there lay the Mona Lisa.

Geri and the museum director noticed and recognized the Louvre seal on the back of the painting. This was obviously the real Mona Lisa.

The museum director said that he would need to compare the painting with other works by Leonardo da Vinci. They then walked out with the painting.

Leonardo Vincenzo, whose real name was Vincenzo Peruggia, was arrested.

The story of the caper was actually much simpler than many had theorized. Vincenzo Peruggia, born in Italy, had worked in Paris at the Louvre in 1908. Still known by many of the guards, Peruggia had walked into the museum, noticed the Salon Carré empty, grabbed the Mona Lisa, went to the staircase, removed the painting from its frame, and walked out of the museum with the Mona Lisa under his painters smock.

Peruggia hadn't had a plan to dispose of the painting; his only goal was to return it to Italy.

The public went wild at the news of finding the Mona Lisa. The painting was displayed throughout Italy before it was returned to France on December 30, 1913.

Does anyone know of a way to get the excise tax under IRC 4980F for a late 204(h) notice waived other than a letter ruling request? I can’t find any other way to get a waiver and the user fee is too high to make a letter ruling request a viable option. Thanks.

Employer ABC sponsors a 401k plan. There are 3 participants. ABC sells practice location #1 of 2 to an employee Z (Non-HCE). The new owner Z does not continue the ABC Plan as a result of buying the practice location #1.

Is this a partial plan termination and should Z's account in ABC 401k be 100% vested?

Controlled group members, one non-profit with a 403B and one for-profit with a 401K:

Same vesting schedule, however the 403(b) excludes service prior to the effective date of the plan, meaning the 401K plan is giving more service credit.

Must I perform BRF testing?  The 401K plan has had no HCEs in prior years but does have one in 2018.  The 403B plan usually has 3 HCE's.