Greetings:

Employer has never filed any 500 for their component benefit plans (life, health, vision, dental) because they are under 100 participants (nor do they have an assigned plan number). The insurer gave their FSA plan number 501 (which has also never filed a 5500).

Employer now has a wrap plan document. We believe that the Wrap Plan should be plan number 501 (along with all component benefit plans under the wrap). Another vendor believe that the wrap plan document should have a unique number from the component plan documents.

Is there any reason why a wrap plan document should not have the same plan number as the component benefits?

Thank you

Can an employer round top heavy contributions to the nearest dollar amount?

An ERISA attorney is asking our client to deposit contributions of less than a dollar to participants because of rounding.

Facts:

1. Plan year end is 4/30/2017

2.Owner A signed a 242(b) election to delay his RMDs - the 242(b) indicates distributions should commence within 60 days after the last day of the plan year in which he retires

3. Owner A dies in July of 2016 at age 82.

4. Owner has 5 non spousal beneficiaries

Questions:

1. When does the distribution need to occur by? Is it June 30, 2017, as per the 242(b) election (60 days after end of plan year)?

2. How much needs to be distributed? Is there catch-up distribution required? The rules are confusing but it seems like you only need to catch-up the contributions is the 242(b) is revoked or modified - this 242 was never revoked or modified.

3. Since there are 5 beneficiaries of differing ages ranging from 30-50 years old, how is the first distribution calculated? (they plan on spitting the account up after the first distribution).

Individual receiving benefits from plan is the only remaining participant in plan. Plan sponsor is no longer around. Advisor wants to know if plan needs to be restated for PPA. If not, why? If so, how should they go about restating?

Facts:

Participant took a loan on 6/23/2014

Participant terminated on 5/26/2015

No loan payments were made for 2014 and 2015. On 1/3/2015 the recordkeeping deemed the loan in default and issued a 1099R for 2015.

Participant is rehired 3/28/2016.

Does the fact the participant terminated prevent the employer from filing under VCP? Employee is willing to make all missed loan payments and income related to the late payments.

The outstanding loan balance is over $37,000!!

If this can be filed under VCP and the Plan Sponsor get approval, does the participant file an amended 1040 for 2015 removing the taxable loan distribution??

Or is the participant SOL!!!

Any thoughts........

I contacted ASPPA who informed me that the Study guide will not be available until AT LEAST the end of May for the Spring 2016 testing window. Has anyone had success using the prior year's study guide for a particular exam?

Several clients with late deposits on 2015 Forms 5500 have received a letter from DOL inviting them to make a VFCP filing (even offering to provide personal assistance in completing the application).

In the old days we used to tell them we'd corrected the PT and filed the 5330 and they left us alone.

Has anything changed and is DOL now going to initiate an investigation and/or assess the 20% penalty if we don't go thru VFCP?

Defined benefit plan is offering a temporary lump sum window to VT participants. The sponsor's DC plan accepts a direct rollover for an active employee.

1. Can the DC plan be amended to permit a direct rollover from a VT participant, when the DC account for this person is currently zero?

2. Same as (1), but assume the DC account is currently non-zero?

(Of course, proposed action is non-discriminatory and would apply to any such VT, without regard to HCE or NHCE.)

PS only husband/wife only Individually Designed Plan restated effective 7/1/08, signed 12/2009. Had rec'd Determination Letter for prior plan doc but did not submit for that one, so currently no effective DL. EIN ends with '2' but no plan doc restatement by 1/31/13.

Restate plan w/VCP? w/out VCP? just wait for next cycle?

Hi,

Can anyone let me know if the 60 day rollover rule would apply for a distribution to an IRA to a deceased participant? Meaning they took a distribution in cash (no withholding) and now have changed their mind. Thanks.

Plan Sponsor received a notice of a change to the 5500 and a fine for a 5500 filed 9 years ago. Is there maximum amount of time the IRS can go back and change a 5500? I was thinking it was 7 years record retention or 3 years.

I want to setup an individual 401K for my wife at TD Ameritrade. My wife has a single member LLC for her business. She uses her own SSN on all forms including W-9 forms. The TD 401K application forms require you to specify an EIN, employer name, and type of business.

Should we fill out the application as an LLC or a Sole Proprietorship? I know the IRS sees this LLC as a disregarded entity as treats my wife as a sole proprietor. My main question is what type of EIN to obtain and use (Sole Proprietorship vs LLC)? I have read the IRS forms which state the LLC EIN really shouldn't be used except for a few specific cases like excise taxes.

Sole Proprietorship
EIN: Sole Proprietor EIN
Employer Name: Wife's Name
Type of Business: Sole Proprietorship

LLC
EIN: LLC EIN
Employer Name: LLC Name
Type of Business: LLC

Thank you

Please help, I'm not knowledgeable about insurance rules and my employer's benefits department isn't very communicative.

My wife and I were married December 28th. We were both covered by our respective employers. February 9th we decided to put myself and my dependants on her health plan, within the 60 day window allowed by her company. Her company backdated coverage to January 1st. March 10th, I tried to cancel my health insurance, assuming the life event window would run from the day we made the change. My company will not stop payroll deductions because the effective date of the change automatically put me outside of the 30 day window.

My case is in "appeal" and I'm still having $85.00 deducted weekly for insurance that I don't need, can't use, and can't afford.

Is there anything constructive I can do to get my money back? Do I have any legal recourse? Where can I find the specific federal regulations that are supposedly forcing me to carry this burden?

Thanks in advance for your help

ok - Company sold a division that included the majority of the employees/participants. It is a partial termination for the plan due to the number of participants involved. The company will continue to maintain the plan for those remaining.

The owners/Trustees/ PA understand that the participants who are moving to the new company will become 100% vested due to the partial termination. They have no issue with that. However they would like to vest everyone 100% as of the date of the sale, including those staying, and then going forward anyone hired after that would be on the 2/20 vesting schedule.

Is this possible? Does anyone see issues with this? All of those involved are NHCE employees.

The Washington Redskins finally drop offensive name:

Dan Snyder, owner of the NFL Redskins, has announced that the team is dropping the word "Washington" from the team name, and it will henceforth be simply known as "The Redskins.”

It was reported that he finds the word 'Washington' imparts a negative image of poor leadership, mismanagement, corruption, cheating, lying, and graft, and is not a fitting role-model for young fans of the sport.

Retirement plan has whole life insurance policies within the plan. (Life insruance in the plan is a bad idea if you ask me, but the plan sposnor didn't ask me.)

Simple example --

Participant terminates with a an invetsment balance of $80,000 and a life insurance policy with a cash value of $20,000. Participant is going to rollover the $80,000 and wants the life insurance transferred to her. Can the plan sponsor have the insurance transferred without withholding the 20% tax or does the tax have to be paid at the time of transfer?

Thanks for any guidance.

If a participant over 70 1/2 had a 242b election and passes away - can the beneficiaries then avoid RMD's because of that election and rollover to their own IRA's and establish future RMD's off the beneficiaries' birthdates?

Would you consider an electrical contractor (business code 238210) as a "service organization" for ASG purposes? I generally would not, but I'm wondering if facts and circumstances could dictate otherwise. For example, all the two businesses do is repair work - no new construction requiring substantial investment/inventory, and the two separate corporations are owned 100% each by Father and Son, (assume they are regularly associated in providing services for mutual clients, etc...)

Pay is for personal services - (ie hourly rate only.)

It still doesn't seem like an ASG, but just curious as to how others feel.

Client missed their 3/15 deadline for MRC and contributed it last week…so now we’re square for 2015…but the client is having a terrific year and now wants to make the maximum 404(o) contribution for 2016…their plan is well funded, though not overfunded but by a little…calendar year plan…original effective date 2013….Cash Balance Plan…owner has 4 years under 415 but has an accrued Br of only about ½ that 415 max….I’ve attached Sal Tripodi’s piece on the issue…

1) Can they deduct the 404(o)max and 2015 MRC in 2016 as “includable contributions”.

2) Can he do 1 year pay credit to synch him up to 415 – he knows he’ll need to make larger contributions for staff, but is a very generous employer…

3) Any other ideas

Is this a split dollar arrangement, taxed under the split dollar regulations?

Agreement between employer and employee that employer will procure on behalf of the employee a $1M term life insurance policy and the employer will pay the premiums. Employer has no right to a return of premiums.

A term life insurance policy (hence, no cash value component) was procured by the employer, the employer was named as the owner of the policy (with right to designate the beneficiary). The employer looked to the employee, pursuant to the agreement mentioned above, to direct the employer whom to name as the beneficiary of the policy, and the employee directed that it be his wife as beneficiary.

While it seems that this should not be a split dollar arrangement because there is no real split of premiums, there is no cash value (term life insurance) . . ., it seems that the split dollar "Compensatory arrangement" rules technically pull this set of facts into the split dollar rules, and I am not seeing a what out of this.

The regs. (1.61-22) say this:

"(ii) Compensatory arrangements. An arrangement is described in this paragraph (b)(2)(ii) if the following criteria are satisfied—