Plan document says that, among other options, a participant can elect nearly equal installments over a specified period of years (with remaining payments to a beneficiary if participant dies before full distribution), or non periodic installments.

My base question is, when do payments rise from the level of being nonperiodic to becoming periodic?

A participant wants to receive $1,000/month.  But, he wants it to be subject to change (like if he needs more or less for a specific time period).

Can the participant go the Plan each month for a distribution?  Or would that rise to the level of periodic?  Or am I just reading way too far into this?

Thanks.

can I take a hardship withdrawal to pay my fathers medical expenses?

Plan is a mess.

5 years ago, while dealing w/downturn, company released auditor & TPA as they wanted to maintain plan but needed to reduce costs. For 1st 2 yrs count was btwn 100-120, so they filed as large but no audit. They then went < 100. All this time, they reported no delinquent 401(k) contributions, in spite, as we have found, many.

They want in good faith to clean up the plan, pay lost earnings, submit VFCP, amend last 3 year 5500's (small plan years). But they refuse to pay for auditor to audit those 2 years (2011-2012). We have explained that the VFCP will include those years and we've explained risks. Just contemplating next steps but wondering if anyone has any thoughts.

A TPA has asserted the following. A CB/DC combo plan that requires a 7.5% Gateway covers 6 of 10 ees in their CB plan and 10 of 10 in the PS plan and the average NHCE EAR is 2.5% in the CB plan. The ER PS contribution is 5%.  Question is do the employees who are not in the DB plan get to use the 2.5% avg EAR, or since they are not in the CB plan, they may only use the PS 5% and therefore must up the PS to a full 7.5%?

An employer match forfeiture was allocated based on deferrals instead of compensation.  Document says pro rata compensation.  If using SCP under EPCRS can the correction method be that the participants that received too much have it taken away and given to the participants that should have received more.

What if the failure has been for longer than the last 2 years?  Can it still be correct using EPCRS?

We have a client with 401(k) plan that provides for matching contributions. Under the terms of the plan, the matching contributions should be made by the time for filing of the employer's tax returns, including extensions.  And of course, under Code section 404(a)(6), they have to be made by then in order to be deductible on the prior year's tax return.

In this case, the calculation of the matching contributions for 2016 got bogged down, and still hasn't happened.  But over in finance, they got very efficient and actually filed the corporate return on March 15, without ever requesting an extension.

So, it would appear we may have two problems:

• The company may have to give people earnings on the late contributions.
• The company may not be able to take a tax deduction for 2016 for the contributions.

Obviously, both of these problems could have been averted by requesting an extension (which would have been automatic).  But is there anything we can do after the fact?  It just seems silly that the company will be out a lot of money due to late contributions, when those contributions wouldn't even have been considered late had the company just requested the automatic extension on its tax return.

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I see plenty of threads on this question and I see that the answer is NO, an employer cannot transfer an entire plan and that each participant must direct the transfer.  Since these threads are outdated, I was just wondering if anything has changed to make it possible for an employer-directed plan transfer? 

In this case, it is a non-ERISA 403(b) plan, if that matters.

I have a new client that has a 401(k) plan that has elective deferrals and match.  After some discussion, it appears that have spoken with an outside consultant who suggested that they added a new comp allocation with each person in their own group.  Based on this set-up, they want to offer the NEC to a very select number of participants in the following fashion.  There are 5 HCEs and 50 NHCEs.  They are going to ask the plan sponsor, annually, which HCEs are to receive the NEC and then gage who and how many NHCEs are to receive an NEC to pass the ratio test.  A quick general example, let's say that 1 HCE says yes.  Based on that, the HCE coverage ratio would be 20%.  Based on that, the NHCE coverage ration would need to be 14%.  Based on that, only 7 NHCEs (14% of the 50 NHCEs) would need to receive an NEC.  This would pass the ratio test for coverage.  The next issue would be 401(a)(4).  Based on this, they could select the 7 youngest NHCEs and provide them with a contribution that would cause them to satisfy the gateway and pass the 401(a)(4) testing. 

While I know that this does "smell" right, I am having trouble finding a reason that it wont work.  There is no reasonable classification requirement as the contribution level can be high enough to pass all testing at the 70%.  Can anyone tell me why this won't work? 

I am sure that I am missing something simple.  Comments are greatly appreciated. 

We have a new client who is a Hospital that currently holds dual status but is dropping the 501(c)3 status.  Currently have a 403(b).     They are adopting a new 457(b) and a 401(a) plan for employer match.     Assets are in 403b individual annuity accounts.   Nothing is changing regarding Employer other than non-profit status.     What are the options to move over those existing 403(b) balances to new successor plan?    Approximately 200 employees are not currently 100% vested in employer contribution.     Exchange or transfer does not apply since they are not going from 403b to 403b.    They do not want to 100% vest currently in the 403b plan.    Want to move match funds and retain vesting schedule.   

An employee's salary is capped at $270k and they've elected to contribute 6%. The payroll system is capping them at 270K * 6% = $16,200 and reclassifying the next $6k above that as catch-up since he's over 50.  However, they are paid biweekly and the only plan-imposed limitation is participants can contribute up to 50% of compensation, so i believe they should be allowed to contribute $18k, barring any HCE limitations. Am i thinking about this correctly? 

The 2 owners in a plan over-contributed to their 401k accounts by $465 each for plan year ending 12/31/2016 even though their W2s state they contributed $18,000.  There were 53 payrolls in 2016.   The refund is being made after 4/15.   Is the Distribution Code a P for Prior Year, or 8 for Current Year?   They are not 50 or older.

Thanks is advance!

For which situations does a TPA get a Form 2848 to represent a taxpayer before the Internal Revenue Service?

What is the TPA's responsibility when a client indicates in the TPA's year-end paperwork that there were no late deposits of deferrals (and/or loan payments), but upon review, the 12/30/16 payroll was not deposited until the beginning of April?

We are preparing the 5500 for the ER to sign. 

What is our exposure if we do not indicate late deposits because we are filling out those questions per the client's direction?

A company is looking to reduce its workforce through voluntary retirements.  Their current pension plan offers early retirement benefits before age 65, with a 1/20th reduction in the NRB for each year a person retires before age 65.

Is there any problem with offering employees who are over age 60 that retire during a 90-day window (e.g., June-Aug 2017) that their retirement benefit will not be reduced?

Example - an employee age 61 could normally retire, but the NRB would be reduced 4/20ths.  If they were to retire between June-August this year they would receive their full benefit.

Is there guidance on how to calculate affordability if a multiemployer plan uses a blended/composite rate?

We had a terminated participant's distribution get flagged by OFAC and received a request for additional information before the distribution could be paid. That's never been a problem before, but this participant stopped responding to e-mails, the phone number she used while employed is no longer working and no one who worked with her knows where she is. The bank holding the funds is now proceeding with their blocking procedure for this payment.  She will have to prove to the government that she is not on their restricted list to get her funds.   Question is, does this affect the 1099-R reporting? She elected a direct distribution and the 20% withholding was deposited.   The blocked amount is the net payment.  Has anyone dealt with this before?

An employee terminates from Employer A and starts working for Employer B.  They are not related.  Both plans allow Plan-to-Plan transfers into and out of the plans. 

What is the benefit of this participant doing a Plan-to-Plan transfer instead of it just being done as a rollover?

Thanks!

Plan uses a 5 year cliff vesting window.  So contrbutions made on account of work performed in 2017, 2018, 2019, and 2020 will vest on 12/31/2021.  So the 2020 contribution might be in the Plan for less than 12 months.

I know it's a facts and circumstances situation, and I think the structure of this is clearly vesting after future performance of substantial services when you look at the overall structure.  But what about the fact that the last  contribution might be funded during 2021 and vest mere months thereafter?  Is there a minimum period of time that a particular years contributions must be subject to risk of forfeiture? The trail would be very clear that regardless of the timing of the deposit the contribution in the last year is allocable to services rendered in 2020.

I'm surprised I was not able to find anything on point about this...

Is there guidance on how to calculate affordability if a multiemployer plan uses a blended/composite rate?