Not IRA specific but hoping someone can provide guidance

What is/was the deadline for a sole proprietor/Schedule C to make 2023 Roth salary deferral contributions and employer contributions (profit sharing) to a previously established (in 2022) Solo 401(k)?

My research is giving me conflicting answers

thank you

Good Morning:

    In the instance of "civil" litigation between two parties regarding an ERISA covered benefit plan, can the defendant in such a suit, that involves an allegation of material misrepresentation (fraud), have the case removed to Federal Court based upon wording contained within the ERISA Statute itself? Thanks in advance for any replies!

We administer a small traditional defined benefit plan that covers the company owner and his spouse.

He is now of the age that he needs to take an RMD.

I know there are many different ways to make the RMD as low as possible but in this case he is not looking for that.

Suppose he wants to take the RMD calculated as an annual annuity and take his first RMD on 11/15/2024 (He could wait until 4/1/2025 but does not want to). Suppose the pre and post interest rate in the document is 5%. Furthermore, his monthly accrued benefit is $15,000.

1. Is it acceptable to calculate the annual RMD as follows?         $15,000 X 12.05 = $180,750?

2. Suppose he takes his first RMD on 11/15/2024. Suppose they terminate the plan 3/1/2025 and all assets are distributed 5/15/2025. Since one year from 11/15/2024 would be 11/15/2025, must he take an RMD when all assets are paid from the plan on 5/15/2025?

Thanks!

We are administering a PEP plan and one of the members wants to terminate. From our understanding, since only the plan sponsor has the authority to terminate a 401(k) plan and in PEPs the sponsor is the PPP, in order to terminate, the member must spin off their plan from the PEP and then terminate that plan.

However, our PPP is insisting that this is not needed and that they can terminate this individual adopting employer without a spin-off. We are having a hard time finding actual guidance on this. Who is correct?

An Employer has an HSA plan and contributes to the HSA, however, an employee was declined an account by the financial institution.  What options does the employer have with their money they would contribute.

Had a potential client come to us who found out their 5500s were never filed for 2020 and 2021 because they say they never had reminders or communications from ADP. They immediately filed them when they found out in September 2024, but did not file thru DFVCP. They then received notice CP 283. It is a small plan and those penalties are hefty, so they are looking to see how they can reduce. I checked EFAST and I don't see filings for two other years, and late filings (by a couple of weeks) for two additional years but unsure if they ever received notices regarding that.  1) Is it even possible to refile 2020 and 2021 through DFVCP?  2) The reasons for being late are typical from COVID - anyone have any success with penalty abatement?

Plan in existence for 10+ years.

Initially only has 401k+SH

2020 added PS subject to 2/20 vesting.

Can service prior to 1/1/2020 be excluded for vesting service for PS portion?

What to do after QDRO has been submitted to x-spouse retirement company who will not release funds? The Company was submitted all legal papers, then company requested a rewritten amendment in the language they preferred which was completed by an attorney, the company then asked for my spouse and my social security which were also submitted, the company then requested for a judge seal which was also done and submitted.  The company erased all emails from their server between myself and all representatives....after I had printed every single email out. My attorney is not longer available to assist in this matter due to illness. 

Our plan is highest 36 months salary for benefits calculation.  I'm trying to understand how 401(a)(17)-1(b)(3)(iii) - sections (A) and (B) work in regards to an employee who resigns mid-year.  Sub-paragraph (A) appears to state that the HCE's earnings are capped on a prorated basis ($345,000/12 per month), while sub-paragraph (B) appears to state that the proration does not apply to a partial year employee. 

If an employee has salary above the 401(a)(17) limit, e.g. they have an annual salary of $600,000, which is above the 2024 limit of $345,000, and they depart on 6/30, how do (3)(iii)(A) and (B) apply? 

Paragraph (A) states "Proration required. If compensation for a period of less than 12 months is used for a plan year, then the otherwise applicable annual compensation limit is reduced in the same proportion as the reduction in the 12-month period." - so the $600,000 would be capped by a pro-rata amount of the annual limit, or $172,500, even thought their six-month earnings of $300,000 was below the annual cap of $345,000."

And: "if the period for determining compensation used in calculating an employee's allocation or accrual for a plan year is a short plan year (i.e., shorter than 12 months), the annual compensation limit is an amount equal to the otherwise applicable annual compensation limit multiplied by a fraction, the numerator of which is the number of months in the short plan year, and the denominator of which is 12"

While (B) has three separate statements, the second sentence appears most applicable to this situation:

"No proration required for participation for less than a full plan year. Notwithstanding paragraph (b)(3)(iii)(A) of this section, a plan is not treated as using compensation for less than 12 months for a plan year merely because the plan formula provides that the allocation or accrual for each employee is based on compensation for the portion of the plan year during which the employee is a participant in the plan.

In addition, no proration is required merely because an employee is covered under a plan for less than a full plan year, provided that allocations or benefit accruals are otherwise determined using compensation for a period of at least 12 months.

Finally, notwithstanding paragraph (b)(3)(iii)(A) of this section, no proration is required merely because the amount of elective contributions (within the meaning of § 1.401(k)-6, matching contributions (within the meaning of § 1.401(m)-5, or employee contributions (within the meaning of § 1.401(m)-5 that is contributed for each pay period during a plan year is determined separately using compensation for that pay period."

I'm confused how these work together and which actually applies to an HCE as in my example.

Under the provision of the Act dealing with the ability to get ER Roth Matching Contributions, is the employee taxed on the match immediately?  If so, what happens if the funds are not vested at the time the employee leaves employment?  Is there a deduction, would they amend their return, etc.?  Or am I missing the mark on the fact that they would be immediately responsible for the tax?  Any help greatly appreciated.

I have been told by a long-time church plan actuary that church plans are subject to the pre-ERISA minimum funding requirements which they summarized as "contributions must be made such that the plan's unfunded liability doesn't increase". Despite several hours of research, I can't find any confirmation that 1) church plans are subject to the pre-ERISA minimum, or 2) that the pre-ERISA minimum is in fact a contribution to at least maintain the funded position of the plan. All I can find is that the plan must be funded (Rev Rul 71-91). Is anyone able or willing to confirm (preferably with some form of documentation) what I was told?

Interested to see if anyone has dealt with a recordkeeper that has a solution for a company that wants to leave their PEP.  My understanding of the process is they must establish a new plan, transfer to the new plan, then terminate the plan.

The recordkeepers that we have PEPs with currently do not have a viable solution for this process.

Curious to see if anyone else is running into this issue and if you have a work around.

Thanks!

Hello benefit experts!

I have not encountered this before, and hence the question.

Two spouses are participating in the same non-governmental 457b plan and have accounts at another company's 401k plan. They are getting divorced. As part of their divorce settlement, one spouse agreed to give over her entire 457b funds to the other spouse in exchange for the second spouse to transfer the same amount to her from his 401k account. The reason they did this was to avoid distribution to one spouse after relocation / termination. The custodian didn't need QDRO, just a letter from the trustee, for the transfer. The transfer is now complete. 

What, if any, IRS documentation or forms need to be filed for this transfer of 457b funds from one spouse to another? 

Thank you!!

This is a very rare occurrence for us but I need clarification.

Participant terminates employment after attainment of the later of age 62/NRA and has balance say of $3,000.  Participant does not respond to distribution communication provided to them.  The plan provides for the standard provisions of mandatory IRA rollover <$7,000 but cash-out if <$1,000.  The plan also appears to say that a terminated participant who has attained 62/NRA is not to be rolled to an IRA but instead provided a lump sum distribution.  That doesn't seem helpful to a person of retirement age.

Is my understanding correct.  Thank you!

A plan sponsor's accountant did not fully transmit payroll contributions to the plan for 10 months of the year. (How they did not notice the substantial amount of money built up or warnings from the recordkeeper is unknown - Excess of $75k).

It looks like the IRS states that significant mistakes made in the aggregate may be self-corrected by making a corrective contribution by December 31. (SCP)

However, in my opinion, this is one of the worst mistakes that can be made while operating a plan.  Would anyone know of a reason this wouldn't fall under SCP?  It seems too significant, but maybe it is not.

As of 10/1, Company A became a wholly owned subsidiary of Company B. Company A's employees moved to Company B's payroll, but continue to work for Company A. 

Company B wants to keep allowing Company A's participants to contribute to their plan until the plans are merged in 2025 but their TPA is saying if they are being paid by Company B they are Company B employees and can no longer contribute to Company A's plan. is that correct?

In past acquisitions, Company B has moved employees to their payroll and continued to remit contributions to the acquired entity's plan until the merger date.  Why would they not be able to do that again? 

Dear sir, 
Thank you for reading my message today. Officially gotten a divorced on 12/2020 in Fort Bend County, Texas and moved to California for my support systems. I had my lawyer but seems like it's done, so move on. Moving on, I agreed to the terms and conditions even though my exwife took advantaged of me. She gave me approximately 30% of the total equity of my property and she took over my home because she couldn't afford to buy a new home. During around late of 2021, she sold the house and lot located in the Philippines, our conjugal property, without my consent. She is currently witholding my fair share of around $95,000 (& she gets $98K) and she has no plans of releasing it to me. I tried to settle this down in a calm and professional level but she gets angry and talk-trash on me. My question sir is this: Can I take her to court legally for witholding my shares as what was stated on our divorce decree? I am financially struggling and she doesn't seem bothered to give me my fair share. What advice can you give me sir? Do I need to get a lawyer for this matter? Thank you and more power to you. 

Can an existing Profit Sharing Plan with a 1/31/2025 plan year end be amended before 11/1/2024 to add Safe Harbor 401k provisions with the Safe Harbor contribution being the traditional Safe Harbor Match? My concern is with the 30-day Notice for Participants in advance of this new feature. The first pay date in November is mid-month.

Hello,

What becomes the "controlling legal document(s)" in a case  where a Defined Benefit Plan's actual  "Plan Document"  does not detail, nor address ,  specific instances under which a Beneficiary Designation Form will be considered  invalid that ARE DETAILED on the Beneficiary Designation Form itself and/or the "Plan's" Summary Plan Descriptions for many years? Thank you in advance for any responses!

I have a QDRO that was signed by the Court and i am sending now to Plan administrator a Certified copy. However, I have an ex-spouse who is surrounded with sketchy, dangerous people who are unset that I am awarded this portion of his retirement. Is there anyway I can request that the plans not communicate with them once the QDRO is approved and the benefits are segregated for safety reasons?