W have a 01(k) plan which was effective in 2021.

Accountant wants to add  Roth contriubtions and recharacterize all prior contriubtions as Roth.

Need some cites, seems crazy.

I was divorced following 20 years of marriage. My ex was to receive 50% of my 2 retirement plans at time of our divorce. I have 2 pension plans as another company purchased the company is was working for. My ex has suddenly passed away and neither of us had started collecting my benefit. The first company has reverted my ex’s benefit back to me. The company I am currently working for says that my benefit is being forfeited. I do not have copies of my QDROs. Both QDROs were filled out and signed at the same time. This makes no sense to me. 

Accountant has approached us for best scenario to avoid LTPT, as he says “who do you know that’s works between 500-1000 hours that can afford to defer”

1. Amend plan to use elapsed time for eligibility, 1 year with no hours for entry, require 1000 hrs for any employer contribution

2. Age 21, 500 hrs eligibility for deferrals, Age 21, 1,000 hrs for employer contribution

3.  Employees signs the enrollment form with a $0 deferral each pay period  OR

4.  Corporate resolution stating the plan sponsor is electing out of the LTPT provisions

Curious to see if any of these are being considered or are being used already.

We represent a company that is about to acquire all the assets of a company that has been a pre-approved plan provider.  Our client would like to continue that business.  Obviously, our client is not so far on the list of entities with pre-approved plans.  And waiting until they could their own opinion letter (presumably Cycle 4 at this point) would mean losing a lot of potential business.

What do entities in this situation do?  The existing plans shouldn't be any less qualified due to the change in provider.  But a) is there any procedure under which an employer which adopted such a plan as provided by our client would have the protection of the opinion letter issued to the former provider, and b) as a business matter, what has people's experience been concerning the willingness of employers to adopt a plan from an entity not on the IRS list of approved pre-approved plan providers?

Can a QDRO be used for Alimony Arrears in Maryland. Also, if the original term of Alimony had ended (but never received Alimony payments, hence why a QDRO is being done), can you file for extension/modification of Alimony even if it is after the original awarded alimony term ends, but there are still arrears?

Plan had late deferrals that were all funded during the plan year.

The recordkeeper posts the contribution and then a few days later the income is posted.  Recordkeeper requires the Sponsor to approve the ACH for the income.

Regarding the Form 5330

Schedule C #5  - date of correction

is this the date the file was sent to the recordkeeper?

or

the date the deferrals were posted

or

the date the lost income was actually posted to the account

Is it reasonable for an employer to provide an SPD during the enrollment process 10-30 days prior to meeting initial eligibility? Or should the SPD be provided only until after eligibility has been met?  

This is to share with you the happy news that today is the 25th anniversary of the first day on which the BenefitsLink Newsletter began daily publication. I didn't see this coming when I decided to go daily in 1999, at age 41.

(The newletters had begun four years earlier, but they weren't being published every day.)

The free information must be helping employee benefits practitioners to help their clients, which translates to the ability of employers to effectively run and fund programs that improve the lives of so many millions of working people (and retirees, and beneficiaries), even if most of them wouldn't know (or want to know) the difference between an ERISA and an eraser. What a noble endeavor, to be an employee benefits practitioner!

Some lawyers and TPAs and other benefits practitioners have found work through our job board that's been running since 1996, which means they've gone to new workplaces and sometimes new cities, which means some of them have met people they wouldn't have met otherwise, which means some of them have fallen in love and then had children... which means there are people walking around on the planet now who wouldn't be here but for this "web site" thingie that started in 1995, and then the idea of sending "newsletters" by "email." None of that would have been possible without readers.

The existence of "BenefitsLink babies" didn't occur to me until one day about 10 years ago, but I kept it quiet -- at that time, they were still teenagers!

True to form, I and my business partner and wife Lois Baker (formerly an employee benefits lawyer, whom I met on CompuServe in 1990 while trading ERISA questions using dial-up modems) have failed to do any marketing of this happy day. But as I sat here at the keyboard today I had the idea that we would get so much joy by celebrating the occasion with readers. I hope this hasn't come across as a commercial but instead is the lifting of an E-flute of cyber-champagne -- here's to employee benefits practitioners everywhere! It's a wonderful community, and for 25 years now and still counting, we are so happy to be a part of it.

Can an employee make a deferral into the plan with money received as severance before the plan termination date or can it be made even after the termination date? Also, does the employer has to put in a match (Safe Harbor) on the severance pay? 

Company A just purchased Company B (December 5, 2024).  Company B will be adopting Company A's Safe Harbor 401-k Plan.  Company B currently has a Simple IRA.  I am being told we need to wait to terminate the Simple until 12/01/2025 because the participants must have a 30 day notice?  Does the fact that they are being acquired impact this?  Any thoughts would be appreciated.

Company B was acquired by Company A and is adopting their plan effective 1/1/2025.  Company B has a discretionary match with a vesting schedule while company A is a safe harbor match plan with no vesting on the safe harbor or profit sharing.  Is it permissible to make everyone at Company B 100 vested with their funds that currently are not 100% vested?  I know going forward there would be no vesting but what about the funds that are currently forfeitable?

We have a DB plan that inadvertently paid a lump sum to a "restricted employee" (i.e. one of highest 25 paid) without first meeting the conditions of Rev Rul 92-76 (eg putting money in escrow, pledging additional property, securing a letter of credit). Any ideas what an acceptable correction method would be? 

We have a calendar year 401(k) Plan with entry dates of 1/1 and 7/1. The plan excludes compensation before plan entry. A young, Non-Key HCE entered the plan on 7/1 and needs to receive the 3% top heavy minimum on pay for the full year. When performing cross-testing we are only using the employee’s pay while eligible (7/1-12/31) and it is blowing the test.

Question: Could we use pay for the whole year when doing our new comparability testing? The plan document does not specify what compensation to use when cross-testing.

Thank you!

I am SO confused by this, and cannot find answers. 

I am a TPA, and I have about 15 clients that had participant distributions from their plans during 2024.  That's 15 separate plan-sponsors.  I use Datair - I input each individual's 1099-R data, and print the 1099-R for the participant and the plan's copies.  Then I move on to the next sponsor.  I do this on paper forms that I order, and feed into my printer as I print each 1099-R.

Am I now required to use the IRIS system??  Or can I keep on doing it the way I've done it -- print XYZ's 401(k) Plan's 1099-Rs, then print ABC's 401(k) Plan's 1099-Rs, and so on?

Thanks!  Trying to be as clear wtih my question as possible.  I appreciate any answer, even if it's fussing at me for being so dense 🫣

it's been determined that a plan sponsor for a large plan did everything right with their payroll uploads, but the payroll company caused a delay in depositing the 401k contributions.

plan sponsor has since deposited lost earnings and then reported this on multiple 5500's, only now being advised to file a VFCP. No 5330 ever filed though.

The delinquent contribution amounts are not de minimis, even by potential revised vfcp standards, though lost earnings are under $5k.

Based on this error, and I know it's often a judgement call, would it be fair to amend the 5500's to remove the delinquent contributions and not go through the effort and cost of a vfcp?

Recently, the US Labor department announced a voluntary information collection request. It invites a retirement plan’s administrator to furnish the name and taxpayer identification number of each separated vested participant owed a benefit (or whose beneficiary is owed a benefit) and is (or would be) 65 or older. See column R on page 91801 https://www.govinfo.gov/content/pkg/FR-2024-11-20/pdf/2024-27098.pdf.

Should a plan’s administrator voluntarily do this?

If a plan’s administrator evaluates whether to do this, what should such a fiduciary consider?
 

It appears that I have an unusual situation.  I was employed with a HDHP and had been making contributions to an HSA.  My employer had financial problems and it seemed I would lose healthcare.  I was 65 at the time, so I enrolled in Medicare part A & B effective June 1, 2024.  The company is now back on a solid financial footing and I would like to cancel Medicare and start contributing to to my HSA again.  My HDHP coverage is still in effect, in addition to the Medicare A & B.  I would like to terminate now, then re-enroll in Medicare in 2-3 years when I retire.

I understand it is possible to terminate Medicare A & B using Form CMS-1763.  What is unclear is whether I can restart HSA contributions.  I would appreciate any advice. Thanks.

We just started using the FT William 401k docs.  I was somewhat surprised that neither the loan procedures nor the QDRO procedures has a place to sign.  Similarly, there is no incorporation by reference of either one in the basic plan document or the Adoption Agreement.  Nor are they approved/adopted as attachments to the resolution/consent to action.

I was just curious if anyone had pondered this before.  I had asked FT "Where are these procedures actually adopted by the Employer" and their response was basically that the IRS had approved the appoach (which obviously is true!).

I mean I trust them of course but would be happy if there was a straightforward answer to this question... 

I'm working on setting up a new combo plan for a one-person sole prop business.  Halfway through, I realize that there is no EIN for the sole prop business.  The sole prop rightly does not want to use their SSN on the plan documents, so I recommended that he get an EIN for his sole prop.

Then I get is an email from the CPA saying that they created an LLC (taxed as a sole prop) effective 12/1/24 and got an EIN for that, and that should be the plan sponsor.

I'm not sure this solves the problem.  Can I say that ALL the 2024 income is counted under the LLC?  I guess it will depend on what's on the Schedule C.  And can I even use the full 2024 limits if the LLC is the only sponsor of the plan (I get tripped up on the pro rating rules, even when following along the EOB)?  I thought of having the original sole prop also adopt the plan... but then I'm back to where I started with the sole prop not having an EIN so I have to use the SSN on the plan document (though not on the 5500-EZ, so maybe that's a little better).  All my projections are of course based on his full year expected compensation.

Is there a solution here?  Or is it not a problem at all?

Thanks.

 

I was divorced a year ago with a Qdro separate interest with annuity at fifty percent, My husband passed away at 65 before retiring. I am listed as surviving spouse but Plan Adm tell me that because i am already receiving annuity i am no longer considered surviving spouse. I never signed any consent form to give up my surviving spouse rights.