A 403(b) plan has a discretionary match.  The match goes to all.  They want to write the formula for the match to give 3% to anyone that defers and works over 25 hours per week only.  Is that ok assuming it passes 410(b) coverage via the ratio test?  I was thinking the 25 hours per week would not be allowed because it would require someone to work over 1,000 hours per year to receive a match.

Can a 403(b) plan exclude adjunct professors as a job class?  Most of those employees are under 1,000 hours per year.  Some might have been a full time employee that went to adjunct status.  They are paid by the number of courses/classes they teach.  They do not have hours works tracked.  Would they have to pass the ratio percentage test or could they use the ABT for coverage?

What if they allow them to defer and just exclude them from the match based on their job classification?

Ignoring the fact that the 5330 is, IMHO, one of the more obnoxious forms ever, I'm taking a poll.

Let's take a fairly standard situation, and keep it simple. Suppose an employer forgets to deposit deferrals from one payroll in 2016. Discovers error in 2017, and corrects, with interest and prior to July 31, in 2107. Interest amounts are very small - say less than (pick a number) $25.00.

In the real world out there, do people:

A. File a 5330 for 2016, and be done with it.

B. File a 5330 for 2016, and another for 2017.

C. Other.

I've seen all kinds of answers/solutions, particularly when you get down to absurdly small amounts such as a few cents or a dollar or two. So I wondered what the experts here do. In case anyone cares, I would say the correct method is "B" above, since this isn't a "discrete" transaction, and is treated for these purposes as a "loan" - RR 2006-38 has an example of this.

Suppose you have a sole proprietor who sponsors a DB and 401(k) plan. He is the only participant in both plans. Both plans have been in place for many years and he has been profitable for many years. He is now winding down and has schedule C profit of only $45,000. He has funded $24,000 salary deferrals to the 401(k) plan. The DB minimum is $0 but has room to fund $45,000 or more.

Can he fund and deduct $45,000 - 1/2 SE tax to the DB?

Generally, salary deferrals are not considered for deduction purposes.

Thanks

A participant in pay status returns to employer.  There is no suspension of benefits nor is a notice of suspension sent out.  Must plan recoup benefits that should not have been made, or can it provide notice, suspend future benefits until subsequent retirement and actuarially set off the benefits against future benefits?  

Hello,

I have a semi-rare situation for an HCE's RMD calculation.

The account value at 12/31 was $1000, but there was an outstanding loan of $45,000 at the time. (Took the loan, then distributed whole account - still employed).

Would we calculate the RMD with a $1000 balance or a $46,000 balance? From the research done, I found a few answers to say include the loan, a few answer to not include the loan. Surprisingly, basically no information on the matter across the board. The IRS & various Publications are silent on the matter - no mention of loans.

We are torn 50/50 on the matter - has anyone had experience with this before? We are looking to find some type of backup or codification on the matter that would make this clear for us

Thank you in advance,

Most users of the message boards want to be able to use their web browsers to monitor activity on the message boards daily or on some other periodic basis. They want to be able to view a list of newly posted topics. Some users also want to view a list of recently posted comments to existing topics.

The two ways that are best for viewing newly posted topics are the "Portal tab" -- take a look -- and the Activities tab -- specifically, the "Topics & Comments" link on the drop-down menu under the Activities tab -- take a look.

For registered users, several alternate ways are available to view new posted topics and comments. First, sign in. Next, click the Activities tab and you'll see menu items that say "Topics & Comments: Unread", "Topics I Have Started", and several more. A complete discussion of these menu items can be found in another topic -- take a look.

Those menu items are called "streams" because that's a metaphor for the ability to view the various kinds of content (topics, comments) that "flow by," starting with the most recent content.

Registered users have the ability to modify any one of those standard streams, thereby creating a custom stream. For example, you might want to see only topics and comments that appear in a particular message board. Thereafter you'd be able to click on that custom stream when you click the Activities tab (they appear when you click the "Activity Streams" menu item).

Basically, to make a custom stream, (i) click on any of the standard streams except All Activity (hard to explain) that comes closest to viewing the list you you want, (ii) click on one or more of the buttons on a horizontal bar that will appear under the heading that shows the name of the stream you're currently viewing -- which has the effect of creating a kind of temporary, modified stream, and (iii) save the stream by giving it a name and clicking a button.

Here is an example, providing details:

(1) Click the Activity tab.

(2) Click the "Topics & Comments: Unread" menu option. (If you're not seeing the "Topics & Comments: Unread" option, it's probably because you're not signed in, which of course requires that you've already registered.)

Your browser will display a list of recently added topics and comments (except those that you've already "read" -- i.e., that you've clicked on, perhaps the last time you were using the message boards).

(3) Under the heading "Topics & Comments: Unread" on the web page, find a horizontal row of square buttons

(4) Click the button that says "Content"

(5) Click the gear icon next to the word "Topics"

(6) Use your mouse to select "401(k) Plans" under the drop-down menu you'll see (which is labeled "Narrow by Forums (Message Boards)")

(7) Click the Apply Changes button at the bottom of that drop-down menu

(8) Refresh the web page by using your browser's "refresh" button (or, for most browsers, press the Control and F5 keys at the same time)

(9) You'll notice that the only topics and comments that appear in the resulting list are those that have been posted in the 401(k) Plans message board (magic!)

(10) Click on the "Save as New Stream" button that now appears under the row of buttons

(11) A form will appear asking you to name your custom stream e.g. "Topics & Comments: 401(k) Plans: Unread"

(12) Click the Create Stream button

Voila! When you visit the message boards in the future, you'll have the option of clicking on "Topics & Comments: 401(k) Plans: Unread" (as a menu item, after you click on the Activity tab and then click on "Activity Streams").

So basically all you're doing is making a kind of temporary, modified stream by clicking one or more of the buttons in the horizontal bar, and then giving it a name in order to save it as a new (custom) stream.

You can have more than one custom stream.

Here are explanations of those horizontal buttons that let you modify a standard stream:

"Show Me" - basically means "show me topic titles only" vs. "show me topic titles and any comments to topics."

"Content Types" - basically means "I want to narrow the list to topics (or comments to topics) in one or more specific message boards." (Click on the gear icon next to the word "Topics".)

"Read Status" - You might want to see only unread items that appear in your custom stream. Or you might be flustered when you click on one of the items in the list created by the stream (e.g. the title of a new topic, so you can read it), and then, when you return to the stream (e.g. you click your browser's "back" button), that particular item has gone AWOL and no longer appears in the list. Some people like that feature, by being able to whack away at the list.

You'll also notice that the "Read Status" button provides a choice as to whether "Unread item links take me to the top of the page" or instead "Unread item links take me to the first unread comment." The standard streams assume you want the latter (rather than clicking on a comment item in the list, being taken to the top of the topic in which the comment appears, and then needing to scroll down to read the particular comment).

"Ownership" - can be used to create a view of topics or comments that have been posted by one or more specified members (e.g. you really admire Gary Lesser's expertise in IRAs and SEPs so you want to periodically get a list of anything he's posted). You might not be otherwise "following" these members.

"Following" - refers to the ability to "follow" a particular topic (i.e. know whenever comments have been posted into the topic), a particular forum (message board) (i.e. know whenever a new topic or a new comment has been posted into that forum (message board), or a particular member (i.e. know whenever that member starts a topic or comments on an existing topic). Look for the "Follow" button on the page when you're viewing a topic you want to follow, or on the page that lists all of the topics in a message board you want to follow (use the "Forums (Message Boards)" tab to get into the appropriate message board), or on a member's profile page (click on the member's name wherever it appears, e.g. next to the title of a topic started by the member).

"Time Period" - provides the interesting options of (i) Any time, (ii) Since my last visit, (iii) Specified number of days, and (iv) Specific date range. Have the appropriate amount of fun with this setting.

"Sorting" - basically lets you see the topics and comments over the time period you've chosen, sorted in order of oldest first rather than newest first. Some folks' brains are more comfortable with the former than the latter (which is the setting I used in creating the menu items).

Do you have any questions? Please post them as a comment (sometimes called a "reply") to this topic. Thanks!

Yesterday I improved (I think) the way the menu under the "Activity" tab works, by renaming some of the existing menu items and adding a few more.

Unless you're using a mobile browser, Activity is a tab that's on the dark blue horizontal navigation bar that appears below the fairly large "BenefitsLink Message Boards" heading that's at the top of all pages. It's between the Portal tab and a tab labeled "Forums (Message Boards)".

(On a mobile browser, the Activity tab instead will show up as a button when you click on the "hamburger" menu icon that appears when the viewing screen is such a small size.)

The term "activity" is a bit ambiguous because it was intended by the maker of the software to encompass "activities" other than the posting of a new topic and the posting of a comment to an existing topic. But those two things are all we mean by the term activity.

Clicking on the Activity tab is just one of various ways to learn about new topics or new comments.

Some people will prefer the much simpler Portal tab, which is a straightforward list of recently added topics and also conveniently shows the first few lines of the text of each topic. (Click on the title of any topic in that list to view the full text of the topic and any comments to the topic.)

Other people will prefer the Forums (Message Boards) tab, which is a big-picture overview of all of the message boards, which lists the name of each message board and provides various stats. But for Keeping Up with the Kardashians every day or two in terms of monitoring the site for new topics of interest or new comments to existing topics of interest, your better choice is probably the Activity tab or the Portal tab.

Here are the items on the drop-down menu items under the Activity tab:

* All Activity

* Activity Streams

* Topics & Comments

* Topics & Comments: Unread

* Topics & Comments: Unread (Abbrev.)

* Topics I've Commented On

* Topics I Started

* Topics/Forums/Members I'm Following

* Search

Here are details about each menu item.

All Activity -- produces a list of all topics and comments, most recently added topics and comments appearing first. This is the "fire hose."

Topics & Comments -- is the same as "All Activity" except the resulting page also shows a set of buttons on a bar that enables you to tweak the list. (More about that later in this post.)

Topics & Comments: Unread -- is the same as "Topics & Comments" except it doesn't list topics or comments you've "read" -- when you click on an item in the list, the software notices that, and considers you to have "read" it.

Each item in the "Topics & Comments: Unread" list is either a recently added topic or a recently added comment to an existing topic. The title of each item is the title of a topic -- either because the topic is new, or the comment is about the topic. When several comments have been added to a particular topic, you'll see the title of that topic appearing several times in the list.

Too confusing? Read on.

Topics & Comments: Unread (Abbrev.) -- is the same as "Topics & Comments: Unread" except that no topic is listed more than once, even if several comments have been posted recently to the particular topic.

That's the last in a logical (I hope) progress of detail -- a "firehose-to-water-fountain" spectrum.

(Maybe "Portal" should follow "Topics & Comments: Unread (Abbrev.)" because that's basically what the Portal tab shows, as a simpler-looking page.)

Topics I've Commented On -- This menu item is a list of the topics onto which you've ever posted a comment.

Topics I Started -- This menu item is a list of the topics you have started (i.e. when you went to the "Forums (Message Boards)" view, clicked on the name of the appropriate forum in which to post your question, and then clicked on a Start New Topic button).

Topics/Forums/Members I'm Following -- is a list of the various kinds of content -- i.e. a particular topic, a particular forum (a.k.a. message board), or a particular member -- which/whom you've chosen to "follow" by having already clicked on the "Follow" button on the page that shows that topic, or the page that shows a list of topics in a particular forum (message board), or the profile page of a particular member.

You might have noticed that I haven't mentioned Activity Streams, which is the second item on the menu. I put it towards the top of the menu so that you can quickly navigate to any "custom stream" you've created. Their names will appear in a drop-down menu when you click on the Activity Streams menu item.

What is a "custom stream"? Basically you would want to make one if you're not quite happy with one or more of the menu items described above.

To make a custom stream, click on any of the menu items (except All Activity) that comes closest to viewing the list you you want, then click on one or more of the buttons on a bar that will appear on the resulting page, and then save that modified view by specifying a name. It will be available to you to use in the future by selecting it on the drop-down menu you'll see when you click on the Activity Streams menu item.

For complete details and an example of a custom stream, please see a different topic (click to view).

Some of you many have thought this fish was dead, but I live on!

An HCE terminates and rolls over the money in 2016.  The plan then fails the ADP test that requires refunds.  I believe the correct method would be to issue a corrected 2016 1099-R to show the taxable piece and the piece that could be rolled over. 

The problem is the recordkeeper won't issue a corrected 1099-R.  What's the solution here?

Hello All,

I am trying to find out the tax consequences of moving a life insurance plan out of the name of the 401(k) plan when a participant terminates. Is this treated like a distribution?

Hi,

do you include terminated participants who have separated from service for over a year and have an account balance in the min coverage test?

Involved in a PBGC plan termination and the Form 500 was already filed, so the 60-day review period has started. I just found out that one person, whom we assumed never worked 1000 years in a year, actually did work 1000 hours in 1 year and, since the plan is terminating, is 100% vested in a 1 year benefit. We plan on sending distribution forms to this person. Is it necessary to file an amended Form 500, which would start the 60-day clock again?

Thanks! 

Does anybody care to comment on if a true ERISA Crime policy would meet the need of an ERISA Bond?  Not quite sure of the answer. Any replies would be appreciated!

I'm working on a form 5500 Sch H where the plan had 11 participant loans roll into the Plan from a prior plan of the Company that was purchased by the client.  (They are definately rollover and not transfer loans; that plan termed.) 

Where would others report these loan balances rolled into the Plan?  My first thought was to put them on line 2 a (1) (C) with the regular rollovers.  However is that really received in "cash" from the participants? Am I overthinking this?! 

Thanks in advance for any replies.

I have a small balance forward profit sharing plan.   195,000 in total assets.  Owner holds 165,000 of those assets, 2 other employees.    One of their assets was a piece of land/building valued at 120,000 and it is now worthless so the plan is taking a hugh loss.     I want to have the owner take the hit for the loss of the asset, and he is ok with that,  are there any issues with doing that?    I know this asset was a bad choice from the beginning...............

I am a payroll manager for a company that is part of a bigger company. We have separate EIN numbers but are part of the bigger companies benefit plans. Recently HR came to me and stated that I needed to refund $200 to an employee due to the FSA funds not being sent to the TPA. Per HR, the TPA is refusing to accept the funds due to it being from 2016 and it now being 2017. This was found out when the employee went to make a claim and was told there were no funds. This is clearly an admin error, and now I need to know if I have to go back and do amendments for each quarter this affects for 2016, or can I refund the money to the employee this year and tax accordingly?   I realize there are more issues associated with this, and am following HR's request, but on the payroll side, I just want to do my due diligence and have clean hands if there is ever an audit. Thanks for any insight. 

Health & welfare plan has always had to file a 5500 because they were over 100 participants.  At the beginning of 2016 they dropped down to 85 participants.  Generally they would not have to file a 5500, but does the fact that they had filed in prior years necessitate that they continue to file?

Thank you for any guidance. 

A client currently has age 21 and immediate eligibility. They are not safe harbor plan. They want to change their eligibility so that interns that are hired for the summer months are not included. However, they do not want to change to 1 year and 1000 hours of service. Can they just exclude these interns and other part-times?

Any suggestions?

Owner has 5 years of service and the only eligible employees have just 2.  Owner sponsors a Safe Harbor 401k providing the top-heavy minimum 3% as a SHNEC.  Can he maximize his 401k in the 401k plan for 2017, and contribute the max to his SEP account for 2017 but not give any additional contributions to the employees (because they are not SEP Eligible) (i.e., in lieu of bumping them up to the gateway minimum).

My research tells me yes indeed this works, but please let me know your thoughts!

This came up because a local CPA asked our advice for an audit his (not ours!) client is going through.  The owner of the business (an s-corp) took a loan that satisfied all the 72(p) loan provisions when he took it out.  He never made a single repayment, and the CPA is still carrying it as a plan asset for the face loan amount.  Oh, did I mention that the loan was taken 20+ years ago?

No doubt this is bad.  But we in the office can't agree on where the badness starts...

Is this a PT?  Where?  When?  Is it different because it's an owner?  I've heard that they have a "higher standard", but unless this owner is a fiduciary (which of course he is), I don't think that's generally true.

Thanks.