I am a TPA working at a financial services firm. I do not work on any non qualified plans. My boss seems to think that I should be able to provide him with a sample of boilerplate language for a COLI plan. In the qualified plan area, I can't imagine anyone being willing to share that for free. Is it something that might be available for a non qualified plan?

PSP terminated April 2018.  PSP assets were directly rolled over to a Individual 401k created April 2018.

I401k Summary Plan Description states:
"Can I withdraw money from the Plan while I am still employed?  You will be able to take certain distributions from the Plan while you are still working for your Employer, as indicated below.
In-Service Distributions
You may request a distribution of your rollover and transfer contributions at any time."

Can I do a direct rollover of a portion of the assets in the I401k to my SEP IRA?  Will this trigger the 10% tax penalty?  Anything I should be aware of?

Thanks for your help.

The plan has never filed Form 5500 in the past.

The plan started in 2005 and covered just the owner and his wife. The balance was over $250,000 due to a large rollover contribution in the first year. It continued to cover just the owner and his wife until 2012, when an employee became eligible. So we have late 5500-EZ filings for 2005 through 2011, correctable under Rev. Proc. 2015-32, and late 5500-SF filings for 2012 through today, correctable under DVFCP.

However, we are still waiting for the client to find the end of year account balances for 2005 through 2007. Without that info we cannot prepare the EZs for those years.

My question is, should we do the DFVCP filings now, in order to close the door on the DOL penalties, at the risk of potentially alerting the IRS to missing past EZs? Or should we wait until the client is able to find their old account statements, and do both submissions at the same time, hoping that neither the DOL nor the IRS come knocking at their door before then?

Has anyone had a similar situation in the past? Am I just paranoid thinking that the IRS will see a "First return/report" with an opening balance greater than $250,000 and immediately come looking for the past EZs?

Hello!

so I have a 401k loan for 15,000.  I have 25,000 left in my 401k.  I just got laid off from my job....  

i called and asked what to do and how to repay the loan , but they were not very helpful and I still have questions.  They mailed me a letter that says I can repay it by November 20, or December 20.  If I repay in December it is an extra 100$.

obviously, I can’t afford that right now.  My question to them was what if I can’t repay it by December 20?  She told me they would report the earnings to the irs and I would have to pay the taxes.  

Does that mean that for my income tax I would have to pay the 15,000 plus the tax.  OR does that mean they will include the 15,000 as income I earned on the income tax, but I would only have to pay the taxes?

thaanks for your help!!

  Daycare ,solely owned by single parent through 100% ownership of Corp stock, has a 401k plan that allows for deferrals and profit sharing with immediate eligibility. Single Parent hires her three children, ages 23, 21, 19, who all immediately begin deferring salary.

Do the Section 318 stock attribution rules apply from the parent to all three children such that all three children are Key employees as well as the parent. OR can the parent's 100% ownership of the stock only be attributed to one child?

Section 13613 of the TCJA amended § 402(c)(3) of the Code to provide an extended rollover deadline for qualified plan loan offset amounts (as defined in § 402(c)(3)(C)(ii)). Any portion of a qualified plan loan offset amount (up to the entire qualified plan loan offset amount) may be rolled over into an eligible retirement plan by the individual’s tax filing due date (including extensions) for the taxable year in which the offset occurs.

Question - Am I correct in saying the new guidance extends the time participant can rollover the value of the offset loan?  The participant is not rolling over the actual loan to the new retirement plan and making loan payments?

core assets rolled over   $40,000 - paid 9/18/2018

Offset Loan                       $10,000

Participant would have until 4/15/2019 to deposit  $10,000 to the account. This would be earmarked as a rollover.

Can anyone explain the rules moving forward in plain English (after the elimination of the 5 year remedial cycle)? 

I cant seem to find anywhere when is necessary to restate and FTW is not much help.

Thanks in advance

Plan sponsor wants to amend its current non-safe harbor 401(k) plan to change from quarterly entry dates to semi annual.  Can this be done for 2018? Or would it need to be done effective 1/1/19?  

It doesn't "feel" right to  me that it would be permitted this late in the year.

I would think that if they have employees that have met the age/service to enter 10/1/18, they wouldn't be able to make them wait until 1/1/19.

Thanks!

Is there any prohibition on amending a benefit formula in a NQDC Plan subject to 409A?

(When) Did gap period earnings get removed for 415 excesses? If so, when?

Thanks so much everyone...

Short story, plan approximately 7 years old.  Alcohol maker in the south.  Business is a single entity (LLC) but the operations are split between a Schedule C (alcohol production) and a Schedule F (Farming operations).  Every year there is a significant profit on the Schedule C and a loss on the Schedule F.  

Schedule F has never been included in the numbers reported to the actuary until this year.  In looking back, it appears as though there are going to be significant excess contributions when the losses on Schedule F are subtracted from the profits on Schedule C.

What should be done about this error?  

One of the requirements for a pick-up arrangement is that the "employer  must  specify in writing (e.g., minutes of meeting, a resolution, or an ordinance) that “contributions on behalf of a specific class of [its] employees . . .  although designated as employee contribution , will be paid by the employer  in lieu of employee contributions.”

 Is there any guidance on what constitutes a "specific class of employees"? It appears that the employer need not cover all employees, just a "specific class." Is anyone aware of any guidance on this point?  For example, it would appear that the employer could commence pick-ups after two years of service and have different rates of pick-up for different classes of employees covered by the plan.

Can the employer prospectively change the amount of the pick-ups, provided the employee doesn't have a cash or a deferred election right? 

We have a payment that is supposed to be paid 10 days after vesting, so it is subject to the short term deferral exception.  We want to accelerate the vesting, which would mean we are accelerating the payment as well, but it will still be subject to the short term deferral exception.

I believe I recall some guidance saying this still violates the anti-acceleration rules even though at no time was it technically deferred compensation (since it was under the exception in both cases), but it's not in the regulations.  Does anyone know if I'm correct that this guidance is out there, and does anyone know where this guidance can be found?

I have a participant that is currently making quarterly repayments, but the large cost has become too burdensome and they'd like to have it taken out via payroll deduction instead.  My question is what interest rate would you use in order to handle the request?  Would you use the rate at the time the loan was taken or would you use the current rate?

Also, they asked if they could pay the loan back over a little bit longer of a time period (they originally set it for 3 years).  

Thanks in advance everyone!

Is there any consensus on whether a Plan should rely on a QDRO when it has reason to know that the QDRO conflicts with the underlying divorce decree's division of property? 

If you receive a QDRO, you review it, determine if it meets the requirements of a QDRO under ERISA, and if so, you implement it.  Does that change if you get extraneous information, like if you also happen to receive the divorce decree and the QDRO does not appear to reflect it accurately? Does a duty to investigate arise? Or is the plan required to implement the terms of the QDRO and not look beyond this?

From what I have seen, different states have different rules about modification of a final divorce decree. Accordingly, different state courts have come to some different conclusions about the validity of a QDRO that conflicts with the divorce decree, based on whether state law allows it as a modification. But, this issue arises in disputes between the parties to the divorce. It seems to me that it can't be the case that a Plan has a duty to inquire or to know, under the state law of various states, whether a QDRO should have been entered or not, if, in fact, it was entered.  If you receive it and it is signed and court-certified, but you also receive the divorce decree, and they're inconsistent, does a Plan ever have a responsibility to determine whether it was a permissible modification of the divorce decree? 

The 2010 regulations at 2530.206 seem to suggest that Plans shouldn't take this into account. "... a domestic relations order shall not fail to be treated as a qualified domestic relations order solely because the order is issued after, or revises, another domestic relations order or qualified domestic relations order."  Would you read this to mean that, when the QDRO is subsequent to the divorce decree and is inconsistent with it, that it shouldn't fail to be a QDRO on that basis? 

However, if it is void under state law because it impermissibly modifies the final divorce decree, then it is not an order "entered pursuant to state law," is it? But, are Plans ever responsible for raising that? Or is that strictly for the parties thereto to work out? 

We have a defined benefit Pension plan and we're going to do an early retirement window where people get extra age and service if they retire during a specific period of time.  We also have a defined benefit nonqualified plan that is linked to the Pension and provide additional benefits in excess of what is allowed under the Pension.  The benefit someone receives under the nonqualified plan is directly affected by the benefit one receives under the qualified Pension (i.e., the more someone gets under the Pension, the less someone gets under the nonqualified plan).

We don't want the nonqualified benefit to be affected by someone taking advantage of the early retirement window.  In other words, just because I'm getting a larger benefit under the Pension for participating in the early retirement window, we don't want that to result in a lesser benefit under the nonqualified plan.

Are there any issues with amending the nonqualified plan to provide the early retirement window benefit doesn't affect the benefit under the nonqualified plan?

In 2014, we obtained an EIN for a DB trust for a prospective client.  In the end, they never adopted the plan.  They have recently contacted us again to start a DB plan.

Can or should we use the EIN we got over 4 years ago or should we apply for a new one?

Long story short ...

We have run across a complex situation where the valuation software is unable to calculate the integrated PS allocation for self-employed individuals and we have to figure this out on a spreadsheet.  Can anyone provide insight on the formula to use for splitting income between compensation and integrated allocation where some partners plan compensation will be over the TWB and others below.  This is probably a long shot but thought I would give this a shot.  Thanks for any help!

I have a rehired employee who termed back in 2004 (1997-2004),  and was just rehired - 8 /2018.

I do not want to credit the prior years of service and want to have them start their vesting over from the rehire date.   Do they keep their service ? 

Is there anything I can do to amend the plan doc to stop this recurring with other rehires?  Currently on a volume submitter.

This is sort of a follow up question to a recent post on funding deadlines.

- Client has a calendar year 401(k) plan with a SH match, no profit sharing contribution in recent years.

- Client initially wanted to do SH only for 2017.  2017 corporate return was filed with the deduction for the SH match.  

- Client now wants to reconsider the profit sharing allocation for 2017, but the CPA has some concerns since they already finalized the 2017 return and would need to make the deposit today in order to deduct it for 2017.

I'm considering the available options and the first that comes to mind is to make the contribution sometime between now and 10/15, which would let me allocate and count the PS for the 2017 annual additions but take the deduction in 2018.  If I do that and max my principals out at their 2017 annual additions, I can still max them out for their 2018 annual additions and deduct both in 2018 as long as the total contribution deducted in 2018 (2017 PS and 2018 annual additions) does not exceed 25% of 2018 covered comp right?