We have a client who is thinking about contributing real property to it's underfunded pension plan.  We know of a few companies that have done this, such as Anheuser-Busch and Coca Cola, and we're trying to find more examples.  Are you aware of any employers who have done this?  If so, who (extra points if you have a link to an individual prohibited transaction exemption for the company!)?

I am a recent college graduate and just landed my first full-time job, so am very new to understanding 401(k)'s and retirement plans. My company says that they will match "up to the first 6% of your pre-tax contributions each pay period." For example, if I contribute $100 every pay period, they will match $6?

EDIT:

The rate is as follows:

200% on the first 2% that you contribute per pay period

50% on the next 4% that you contribute per pay period

Should every 69.5 year old 5% owner take an in-service distribution so long as the plan allows?  Rollover to an IRA and thus take an RMD on the account balance method and save money on personal income tax.  I'm struggling to find a reason not to.  I say 69.5 obviously so we get ahead of it before the first distribution calendar year.

-Dan

So, you have a SH nonelective 3%. Client wants to amend plan mid-year to exclude certain compensation categories.

1. Can this be done, with appropriate advance notice of 30-90 days? I've heard varying arguments on this. Some yes, some no.

2. If yes, I presume you would credit the 3% on this comp through the effective date of the amendment. Although for the non-SH contributions, such as PS, if they have a last day/1,000 hour requirement, could use the reduced comp for the whole year for that portion.

First of all big thanks to Dave for adding a FTW user group!

I am having a small issue in the 5500 module.  Every attachment is upside down no matter what the actual orientation is.  Is anyone else having this problem?  I spoke to support last week and so far the only work around that seems to be effective is to "print to .pdf" from the .pdf that shows upside down.  Basically a copy of a copy to make it work at the moment.  

Picture it if you will...

Husband owns 100% of the company.  Wife works at the company and is a trustee of the plan as well (yes, owner by stock attribution).  The wife has a son from a prior marriage (not adopted by the "new" husband).  The wife would like to hire her son as the financial advisor for the husband's 401(k) plan (that has employees...not a solo), so that the son can receive the commissions/fees.  The 401(k) plan allows for self-directed accounts.  Everything I read is very gray.  I read that it is unacceptable, but then goes on to say unless the fees are reasonable, etc.  Assuming that the fees would be reasonable, is this allowed?  Every fiber of my being says it's unethical from a fiduciary standpoint, and should be a prohibited transaction with a party of interest, but this client is going to want "proof" that it is not allowed.  Opinions?  Cites?  Thanks so much!

Hello!

I recently made a duplicative 8955-SSA filing on the IRS' FIRE system in error.  The message that the system gives me is " . . . If your file was submitted in error (it was a duplicate filing), this file will not be passed forward to SSA, however you must notify IRS to close the file."  However, I cannot find any information on how exactly to notify the IRS to close the file.  Has anyone else had this happen, and if so how did you close the file with the IRS?

Thanks for your help!

When a retirement plan’s fiduciary (whether it’s the plan’s sponsor/administrator, a § 3(38) manager, or a § 3(21) advisor) evaluates investment funds to consider which should be added to or removed from a plan’s menu for participant-directed investment, which sources of information does a fiduciary use?

Does a fiduciary look at the Beta, R2, Sharpe Ratio, Standard Deviation?

How does these measures aid, or distract from, one’s analysis?

Does a fiduciary use Morningstar?  Lipper?  Bloomberg?  Litman Gregory?  Zacks?  Zephyr?  Others?

Which sources do you like, and why?

Non-profit organization, non-governmental (a private college). They have a qualified plan (money purchase)  where, as a condition of employment, the employee MUST contribute 5% of pay. Employer then matches anywhere from 5 to 10 % of pay, depending upon service, etc. So far, so good.

The baffling part is that the SPD, and the plan audit notes on the 5500 form clearly indicate that these mandatory employee contributions are PRE-TAX. We’re under the impression, and the EOB seems to confirm, that such mandatory contributions are AFTER-TAX.

Am I missing something? Are mandatory employee contributions (non-governmental plan) allowed to be pre-tax? Or is it perhaps poor drafting in SPD?

I've got a participant who died at age 69 and one month back in December 2016.  Her beneficiary designation form says to pay her account balance to some charitable NFP (she was not married at time of death).  Is there any withholding taken from the payment?  Thanks.

If an employer begins to pay the related 403(b) fees, does that employer involvement cause the plan to fall under ERISA status to shift the plan from non-ERSIA 403(b) to ERISA 403(b)?

Hello everyone,

I just wanted to know if anyone here sat for ASPPA's DC-1 exam recently? I'd like to discuss few things.

Thanks.

With some recent threads regarding the fiduciary rule (is X a fiduciary under the new rule?), I wanted to revisit how people are handling their 408b-2 notices.

Is the fact that the fiduciary rule is now in effect changing your approach to your 408b-2 disclosures (or lack of 408b-2 disclosures)?  Or do you do 408b-2 disclosures for all clients regardless of covered service provider status?

Are there brokers that specialize in the sale of TPA Firms?  If so, who are they?  Thanks in advance for your help.  

I've tried searching for an answer to this and cannot find a direct source for a response.  Also, my plan document is eerily quiet on the issue so I thought I'd look for some ideas here.

I have a plan that was effective 1/1/2013 and frozen 1/1/2016.  The formula is 10% of comp per year of service and 3 year average comp of $260,000.

As of the freeze date, the monthly accrued benefit is $6,500, but is limited to the 415 dollar limit of $5,250 (due to the limit of 3 years plan participation).

As of 1/1/2017, the plan formula is still $6,500, but does the 415 dollar limit increase to $7,000 due to another year of plan participation?

Suppose you have a small employer with 7 employees. All are full time and have been with the company for years.

They sponsor a defined benefit plan and a profit sharing plan.

The 100% owner and two other employees are covered under the DB. three other employees are covered under the profit sharing plan. The owners son is excluded from both plans. Therefore, no employee participates in both plans.

The profit sharing plan has no HCEs benefiting. Therefore, it passes 401(b) and all of its participants receive the same profit sharing allocation so no other testing issues.

The DB passes 410(b) but NHCEs receive slightly less than the business owner so they run 401(a)4 and it passes. In completing the 401(a)4 test, I believe the employees who are excluded need to be included in the test with $0's correct? And if so, don't those being excluded need to receive a minimum gateway?

Thanks.

We have a SH 401(k) that is terminating.  One of the owners (more than 5%) is over 70 !/2 and will need to take his 2017 RMD.  This participant has an outstanding loan balance.  If he decides to default on the loan can the outstanding value of the loan be used to satisfy the RMD?  The plan's assets also include some real estate.  If this same participant wants to retain ownership could the value of the property be used as part of the RMD?   Thank you for your responses

if a safe harbor nonelective plan allows after-tax but does not have a match, does it have to pass the ACP test?

On the new Form 5300, Line 12 asks if interested parties have been given the required notice and then says "attach statement". As opposed to all the other lines that say attach statement, the instructions for line 12 say nothing about attaching a statement or what it is supposed to say. If they want a copy of the Notice to Interested Parties, is it too much to ask that the instructions say so? Maybe this is a carryover from the old line 12 which asked a different question but had the attach statement requirement which was then explained in the old instructions? How are people handling this line?

Okay I am going to make this easy as I swear I've read something, somewhere on this topic:

Person does not qualify to make the Roth IRA contribution due to income.  They open a traditional (back door) IRA and convert to Roth.

Question:  Can they do that regardless of any other rules?  For example, I swore I read somewhere that if the person had any other traditional IRA established, there would be taxation on the back door contribution other than conversion.  Am I losing it?  I've talked to a few IRA custodians and they no worries, I can do make the contribution without any regard to whether I have any other IRA(s) established.  True?

Thanks in advance.