I'm working on Form 5500-SF and come up with one clarification.

My plan fails coverage test and ABT and passing by combining another plan with my plan and passes coverage. In this scenario, whether I have to check yes for "Does the plan satisfy the coverage and nondiscrimination tests of Code sections 410(b) and 401(a)(4) by combining this plan with any other plans under the permissive aggregation rules?".

Another plan combining both ADP ACP and 401(a)(4) with another plan. Whether I have to check Yes for this scenario for 14a.

Is possible explain what is the difference between these two scenarios and give me link of documents which explains this scenario.

Thanks in advance!!

Imagine your client’s retirement plan provides on severance-from-employment an involuntary distribution of a participant’s account no more than $7,000, accepts rollover-in contributions, and otherwise is eligible for the auto-portability network the plan’s recordkeeper offers.

Imagine your client asks for your advice about whether to approve auto-portability.

And your client specifically asks for your advice not about what’s best for participants, but rather about what’s most risk-avoiding for the fiduciary.

What responsibility and potential liability might a fiduciary face because it approved auto-portability?

What responsibility and potential liability might a fiduciary face because it did not adopt auto-portability?

How do you advise your client?

We have a new client that is a partnership.  There is one partner who also has a corporation that is an affiliated service group member that has adopted the 401(k) plan of the partnership.  Proceeds from the partnership flow through to his corporation and he receives a W-2 from that corporation along with a K-1 from the partnership.

This partner's K-1 has $500,000 in box 1, but $0 in box 14.  The CPA for the partnership is insisting that box 1 from the K-1 should be used as his earned income for plan purposes - not box 14. This partner has a small W-2 and no 401(k) withholdings listed in box 12 - both of which would be problems unless K-1 box 1 is used as his plan compensation.

I was always taught to use box 14 from the K-1 as the earned income figure (which is then reduced for 50% FICA...) to determine plan compensation. Is this correct or should box 1 of the K-1 be used as the CPA suggests? I couldn't find anything to support the CPA so I'm hoping someone here can provide clarity.

For the 2022 Plan Year, ADP testing was completed and refunds were issued in March 2023.  The participants received 1099-R’s in January ’24. 

It was later discovered the ADP test was run incorrectly, and approx. 10 HCE’s received too much in refunds.  A handful of those HCE’s have since terminated employment.

This is a large Plan that is audited. How (if at all) can this be corrected? I doubt any of the terminated participants would want to re-deposit the money into the Plan. Would the employer make a QNEC of the amounts refunded in error to those still in the Plan? 

I had a 401(k) that I terminated on 4/15/2020.  I was the only participant.  I rolled everything to my IRA.  I filed the final 5500-SF return.  I shut down my business on 9/15/2021 and retired!  Yay!

I'm sitting here minding my own business and an envelope arrives from Schwab.  It's a statement with a Statement Period July 1, 2020 - March 31, 2025 showing that an old investment paid out a settlement of $95.  I had to call to get a check issued because I haven't had online access to that account since 2020.

OK, now I have the check.  I'm going to deposit it.  I just don't know where (IRA, personal account?) and how much paperwork has to be generated.  If it's too big of a hassle, I was thinking I'd just rip up the check, but the account would be open (maybe) forevermore.

What to do, what to do

Mine is a TPA firm, XYZ Pension and having Datair Pension Reporter software to e-file 5500 form. Now, I am starting another company ABC Pension. 
Question: Can I mention ABC Pension on Sch. SB with Actuary name and e-file 5500 for DB plan using the XYZ Pension’s software. 
Thanks for your time and helping me.

Hi

Just picked up a PBGC audit for the first time well in over 10 years.

Any new developments/things/pointers anyone with recent experience can share?

Thanks

I have seen QDROs that provide an Alternate Payee is prohibited from listing a new spouse as beneficiary.

Is this typical?  Is it allowed?  Can a plan refuse to allow this, and instead just say, "once the AP has his/her own account, he/she can name whatever beneficiary he/she wants?"

We would prefer to just divide the account and not have to keep track of additional restrictions like this.  But we will if we are required to.

Does it make any difference if the plan is a DC or DB?

There were several new "indexed for inflation" figures for SECURE 2.0 that don't seem to be published anywhere.  I'm pretty sure these are all indexed:

1) $100,000 threshold for employer contribution credits.

2) $145,000 threshold for Roth catch-up requirement

3) Domestic Violence $10,000 limit?

Why aren't these included on any charts/tables?  Anyone have a solid source with all of them?  Ferenczy seems to have the most (hers has the Domestic Violence one, but not the employer contribution credit one.

https://ferenczylaw.com/flashpoint-2025-cost-of-living-adjustments-2-2/

Hi,

Thank you for all the insights and input. Is anyone able to post a link etc for a segment rate calculator that is based on on the 24E or 25E Table or is that not allowable on the forum? Thank you either way.

I would appreciate some guidance or recommendation for a CPA or Tax Professional. Spouse retired 7 years ago and would not execute QDRO for AP. After much litigation, court will be ordering enforcement of marital settlement agreement providing 50% of FRS Defined Benefit at the time of retirement. There’s quite a lot of retro money that will be paid. Retiree’s attorney wants to make a partial lump sum payment to lower interest prior to final judicial order to enforce QDRO. Alternate payee needs tax advice regarding pre QDRO lump sum payment and post  QDRO retroactive payments. Basic question…is a payment made prior to QDRO enforcement taxed the same as a payment post QDRO?

We have pre-approved non-standardized documents.

All defined benefit plans had to be restated for Cycle 3 by March 31, 2025.

Even though about 90 plan sponsors did adopt the restated documents by March 31, 2025, we had 4 clients who did not.

Our understanding is that the restatements can be done through self-correction as long as they are adopted within two years of March 31, 2025. In addition, we believe the plans would need to adopt all amendments between the last restatement (PPA) and now (Cycle 3) to properly do this through self-correction. This as if the plan were an individual design.

Question: Is there a list somewhere of all the required amendments between the  PPA restatement and the current Cycle 3 restatement? If so, could you let us know?

Thank you.

Hi,

North Carolina was originally given an extension until 5 /1 /2025. This included the 5500 for 2023. On 4/17/25 this extension was further extended until September 2025. This additional extension from 5/1 /2025 to 9/2025 includes the 5500 and the pbgc filings. Correct? Thank you.

Husband has owner-only K and DB plans.  Spouse has her own owner-only K plan with a bundled provider for a couple years.  

Total assets exceed $250,000 so all plans are to file 5500s.  We are investigating if 5500 has been filed for her k plan.  I doubt that the bundled provider inquired as to whether she was part of a controlled group.

I don't know how far back her plan goes. She was added for coverage under his DB plan for a nominal benefit which I was told was required due to being a controlled group - maybe 401(a)(26).  That may have been the first year of her K plan.  I realize the max penalty is $1500 but hopefully someone doesn't have to go back a bunch of years to file.  I have a feeling we'd be asked to do that even though we have no role with the plan.  You know how things go - the record keeper will say they are investment platform only.

Thank you for any comments.

Tom

An association of related businesses sponsor a closed MEP. There is one Form 5500 filing that includes the Schedule MEP. I'm not able to find clear guidance on how to file a Form 5330 in a closed MEP situation. Let's say there are several businesses in the MEP that fail to distribute ADP failures timely. Does only 1 Form 5330 get filed with the aggregate of the prohibited amount reported for the excise tax? What about late deposits? 

Hello,

When I submitted my 2021-2023 renewal, I included many live and on-demand ASPPA webinars in my CEC counts, as I normally do (I don't normally pay attention to my PTIN record as I didn't think they normally rely on that). The IRS emailed me saying I was short a bunch of credits (all that weren't on my PTIN record), and that I had to submit the "IRS program numbers" for the courses in order to receive credit.

Upon requesting the program #s from ASPPA, I learned that none of their webinars that originally aired in 2021 (whether viewed then or on-demand in 2022) were eligible for ERPA credit. It appears that at least some of them had program #s at some point, and it seems like they were intended to qualify but something failed in the process (perhaps related to COVID?). Now I'm short a bunch of credits. I'm not able to find whether ASPPA originally communicated whether ERPA credit was available for each webinar, but I normally confirm that when I sign up.

Obviously, we need to monitor our PTIN records closely real-time.

Has this happened to anyone else? Were you able to resolve it with the IRS?

Let's say an employee enrolls in an HDHP with family coverage and contributes to an HSA. Their spouse contributes to a general purpose health FSA, which we know is disqualifying coverage for purposes of the HSA. But how would the IRS know this? It doesn't seem that health FSAs are reported to the IRS (whereas dependent care benefits, like dependent care FSA contributions, are reported on W-2). What am I missing? 

Can anyone provide a code citation that defines when a participant in a defined benefit plan (CB in this case) is considered to have been paid a lump sum distribution? Date funds leave the trust, or date participant has control of the funds? Or something else? I've looked, but I'm not a very good looker, and hoping someone here can at least point me in the right direction. Even if no citation, would love some opinions on this. 

This is related to some mandatory cash-outs that were started the last week of Dec 2023 from a calendar-year CB plan. The Plan wired the required funds to the distribution custodian on 12/26/2023 and provided participant hypothetical balances as of 12/31/2022 (Plan Doc does not allow pro-rata interest thru ASD, just the last-day interest credit). TPA states that since funds were sent to distribution custodian before 12/31/2023, the participants are considered paid in full as of that date.

We've since learned that several of the participants did not receive funds until well into February 2024 (delays in responses, paperwork, etc.). Anyone feel like they were shorted their 12/31/2023 interest credit?

Thanks in advance!

Hello,

I was wondering if it is unlawful for a company to deny opt out money that they offer to all eligible employees to married couples that both work for the company? As individual employees we each receive a benefit plan that includes Healthcare. We choose one family plan through the wife's benefit package, therefore not using the husband's benefit package. Yet, we are denied the opt out insurance money for not using the husband's Healthcare plan. Could this be considered discrimination based on marital status?

Thank you in advance!

We have a participant who died, his wife beneficiary was injured in the car accident as well and has medical bills so she is in a big hurry to get his account which is $100,000+.  (So the plan sponsor puts the medical bill guilt on us.)

We asked for the death certificate but was told it would not be available for 12 weeks.  The record keeping platform does not require a copy.  

I see 2 options:

- Ask the plan sponsor owner to confirm that the participant died and then we rely on his direction (such as did you go to the wake and see the deceased?)

- or wait it out and require the death certificate.  I'm strongly inclined to require this. I don't want to take any chances.

Comments?

Thank you, Tom