My plan document seems only to have distributions for the situation where the participant make 401k contributions in more than one plan. And EPCRS seems only to address missing the 4/15 deadline.

So where do I turn for correction in this situation?

A 401(k) plan covers a doctor, age 71 and his wife (not yet 70 1/2). I recently sent required minimum distribution paperwork to the doctor. Today, his financial advisor called me and said, "Don't worry. We've already satisfied his 401(k) RMD by increasing the amount he took as an RMD from his IRA." I thought that the RMD has to come from 401(k) plan assets.

Who is correct?

Thanks for any responses!

Plan has 120 participants, 95 of which have balances. We amend the plan effective 1/1/17 to exclude, by name, 30 non contributing participants. That gets the BOY Count to under 100 and therefore no audit.

Anyone see any issues?

Any issues with making another amendment later in the year, say February) making "all employees" eligible for the plan?

On 3/15/2010, we did our safe harbor match of 3% across the board to every eligible employee who worked and met our requirements in 2009 even if they left during the year. There were three terminated employees which the pension plan never deposited in their accounts because they had withdrawn their funds but they never notified us of this issue.

In 2014, when I was doing our bank reconciliation, I noticed one of the 401K funds withheld from a payroll was never deducted from our bank. When I contacted the pension plan and questioned if the funds were deposited into the employees' accounts they said yes and my boss verified everyone had their funds in their account for that payroll. After many months of emails and calls to verify this, we assumed the bank had made an error in our account and not the pension fund.

In 2015, once again when we were doing the bank reconciliation, it was noted that the pension fund took out less then what was withheld from the employees' paychecks.l

After many phone calls and emails, we were finally able to determine that the pension plan used the funds from the three former employees in 2010 which was sitting in a cash account to cover the two payrolls described above. All of this was done without our knowledge. We were not aware they had a cash balance with funds we submitted.

In speaking with our accountant, they have agreed with us that we have to give the three former employees the funds they were entitled to in 2010. My question is how do we do this correctly? We don't know a way to have the monies go through our payroll as this was done in 2010 already. And the pension plan can only take funds from payroll. If we send checks to the former employees, is the whole amount taxable to them? Is there a way to get them the funds so it's not taxable until withdrawn?

I am really rusty with respect to testing a DC plan only.

The plan has eligibility for:

Deferrals of age 18

Match and Employer of age 18, 1000 hours and 12 months

QNEC of age 18

The client is questioning whether employees eligible for deferrals but NOT eligible for the match should be excluded from 410(b) testing (both ratio percentage and average benefit percentage test).

Any help would be appreciated and thanks in advance.

I certainly wish all a Merry Christmas, may God bless all.

or Happy Hanukkah if that is your faith.

my apologies if those 2 statements leaves someone off the list.

in case you have lost the Christmas Song puzzle, here it is.

you probably have to enable editing to enter items in the puzzle, I don't recall.

enter a number in the 'yellow' field, the number is from the song list on the second tab.

........................................................

note: I attached a slightly different version of the excel sheet. the only difference is at the bottom of the song list. (I had that on my original excel file but attached the wrong version earlier.

The Long Version of the SSQQ Christmas Puzzle is the Original Work of Rick Archer. I share it as my gift during each Holiday Season. Everyone is welcome to reproduce my puzzle for their own private use to entertain students, friends, and visitors as long as you do not charge money. It is meant to be a non-commercial form of entertainment in the original spirit of Christmas Giving.

No one may reproduce any part of the Long Puzzle on the Internet or for any form of commercial use without the written permission of Rick Archer. If anyone sees any part of my puzzle reproduced elsewhere, please let me know. Thank you for respecting my wishes.

Rick Archer

the link to his sit should be on the excel sheet. there are now 150 puzzles available, but he has replaced a number of the pictures and personally I'm not as happy with tehm, but then that is me.

christmas puzzles- 130 to solve .xls

I have a db plan(actually db/dc combo) under audit. The agent is suggesting an amendment is required which would increase the db benefits for two nhces. I strongly disagree with the agent's assertion. Is there any harm in arguing why I think the agent is wrong(in other words is the worst case the IRS will just say we are right and you must amend?).. The plan is a good bit overfunded(350k) so the additional benefits(about 45k in value )would not be a hardship and would not create any current contribution liability but why should the ees get a slight windfall if it is not justified?? It is not really fair to the other ees in the combo..

A second question is whether plan audit related fees are properly payable from the plan or are they settlor type in nature??

thank you for any comments...

Greetings,

The plan sponsor is required to make a corrective contribution for the missed deferral opportunity. The EPCRS states that if the employee had not made any investment choices, the rate of return (ROR) under the plan can be used. It was my understanding that if the ROR is negative, the IRS underpayment rates must be used but I can't point the Rev. Anyone has the citing for this?

Thanks.

What is the easiest and quickest way to apply for a TIN for a new small 401-k Plan? Any help is greatly appreciated!!

I generally don't deal with 403(b) plans, but I'm trying to help a friend (the ex-husband in the case below).

A professor participates in the university's 403(b) plan. She is divorced and a QDRO awards her ex-husband 40% of the marital portion of the 403(b) benefit, which winds up being about $72,000. The ex-husband needs the funds, so, even if it's rolled over into his IRA, he will immediately have the funds distributed from his IRA. The participant has offered to pay him by check, but will charge him for doing so.

1) Can the participant charge for paying by check?

2) If the ex-husband is 56, will he need to have a) 20% withheld for federal b) applicable state withholding withheld, and c) the 10% penalty? Will this be true if he rolls it over and has it immediately distributed?

Thanks for any responses!

The 401k SHPSP provides for pre-tax deferrals, SHM, PS and Davis Bacon contributions. All sources are 100% immediately vested, with the exception of the PS component.

The Davis Bacon contributions are used to offset the employer discretionary contributions (i.e. PS), and included in the general testing,etc,

In order to be able to count the DB contributions and avoid annualization rules, does the PS component needs to be 100% vested also?

Thank you!

Cash Balance Plan effective 1/1/2014.

Service prior to effective date excluded for vesting purposes.

Owner becomes vested in 2016.

When is his first RMD due?

Is anyone aware if Internal revenue bulletin 2004-26 has been updated for max J&S percentages for larger age differences with non-spouse beneficiaries? 12 years is a long time. Does there exist a table for spousal bene's with large differences?

Thx

Quickly following the recent publication of the Labor department's rule on an ERISA-governed plan's claims procedure concerning a disability benefit, some practitioners suggest that an employer design an individual-account (defined-contribution) retirement plan, if any benefit is provided because a participant is disabled, to refer to the Social Security Administration's decision on whether a person is disabled.

Leaving aside questions about an alien who is authorized to work in the United States, is there any circumstance that would make a citizen ineligible for a Social Security benefit so there could be no SSA decision to refer to?

We have an specified employee who made a subsequent change to his election. He changed his election to receive payment upon separation from service to receive payment 5 years following separation from service.

Should we pay:

1) exactly 5 years following separation, since the 6 month delay will automatically be satisfied, or

2) 5 years + 6 months following separation, since the payment would have originally been paid 6 months after separation due to the specified employee delay?

I'm inclined to go with 2, because the regulations state a subsequent change should "be deferred for a period of not less than five years from the date such payment would otherwise have been paid," and that date would have been 6 months following separation. Anyone agree/disagree?

5500 Schedule H instructions call for the reporting of the aggregate of option positions at the beginning and the end of tne plan year on Schedule H, Line 1.c.15 (Other)..is reporting of realized and unrealized gains and losses required or relevant?

A plan uses W-2 compensation but excludes fringe benefits. The plan sponsor grosses up wages for the disability insurance premiums. Is that amount that is grossed up a fringe benefit?

Potential client started business in June 2016 as a sole proprietor, wants to set up 401K/PSP by 12/31

He was told by another TPA firm if he establishes the plan 12/1/16 (I assume they are speaking of a December 1, 2016 effective date - which makes no sense), that he could only base his 25% on net schedule C from December 1- December 31.

Why would not effective date of the plan not be 1/1/2016 if the intent was to make the full 25 PSP on his self employed income?

Then again, if the full Schedule c was from June - December, why would the prospect be told that he could only do one month?

Unless, the broker did not explain the situation correctly.

Has anyone run across as good checklist of information or data request form or something like that to gather the information to review for affiliated service group status? I always feel like I'm missing something, and they tend to become these long, rambling conversations... which are great for building a relationship with the client, but not so great for making sure I get everything I need. Thanks.

Hi, I have a 403(b) plan that started making employer contributions in 2001. Never had a plan document, never filed 5500s. One participant for fifteen years, then two participants for a couple of years. I can deal with document issue. My question is, do I have to start filing 5500s back to 2001? I believe the answer is yes. Neither vendor nor participant can provide statements for the account prior to 2008. Would you file knowing what you know, i.e. the amount of contributions, pro rate earnings?

I'll be filing under the DFVC program.

Any help/ suggestions would be greatly appreciated.

Thanks,