If you are doing a VCP submission for a late interim amendment (where the compliance fee is only $375), can you submit the late interim amendment in proposed form, rather than a signed amendment)?

When doing the nondiscriminatory classification test, we use the mid point between the safe harbor and non-safe harbor numbers.

Are those two numbers (sh and nsh) used for anything else? If we are always using the midpoint, why have 2 #'s?

A plan makes the decision to switch to a Stable Value fund with a slightly lower rate in order to reduce recordkeeping fees. I can't find what notice, if any, is required to participants. Would this be considered a 'fund change' that would require 30 days notice in order for the plan to receive 404c protection?

Do you have plans with ExpertPlan? The website is going dark 1/8th. We're raising a big stink and emailing everyone we know at Ascensus. You should do the same if you have a decent book over there.

Download all of your reports now. I don't know what you're going to be able to do get transaction histories if you're researching deposit differences.

One of the worst decisions Ascensus has made, and there is a lot to choose from.

I am working with a client who has requested that a retroactive amendment be made to their current AA. The plan is on a pre-approved prototype defined contribution document. They know that the amendment must go through the VCP program.

Number 7b on the Form 8950 asked if I have concurrently submitted a Form 5300 series? I have answered the question 'no' as I was under the impression that the service is no longer accepting Determination Letter request for pre-approved plans. Am I correct in my assumption?

By answering 'no', the form instructs me to provide an attachment explaining why we did not file. What should the attachment say?

Thanks for your help with this matter.

Accounting firm merged with another accounting firm on November 1, 2015. Therefore, the auditor will be different for 12-31-15 audits than it was for 12-31-14.

Question is does this change in auditor, due to the merger of accounting firms, require the completion of Part III of the Schedule C, reporting the "termination" of the accounting firm.

Thanks for any replies.

An ESOP retirement plan has fewer than 100 participants at both the beginning and the end of the plan year. All of the plan's assets are "qualifying plan assets" within the meaning of the 104-46 rule. The employer securities are not publicly traded.

Is there anything about the ESOP nature of such a plan that would preclude it from relying on the small-plan excuse from an independent qualified public accountant's audit of the plan's financial statements?

Plan sponsors both a US and a Puerto Rico plan (not dual-qualified but separate plans). I have an HCE that worked for both companies during 2015 and participated in both plans.

Does mandatory HCE aggregation apply? In other words, if both plans were US plans (assuming part of the same controlled group) and the HCE was eligible and participated in both plans, I would be required to aggregate their comp/contributions under both plans and test the total in both plans. Is this a requirement if US vs Puerto Rico plan?

Trying to dust off my memory on this issue.

A new company is establishing a 401(k) in 2016. The selected record keeper will serve as the discretionary trustee.

We are in the process of establishing an oversight committee.

Currently the board has three members, one U.S. two from London. Assuming the board retains the final decision making authority for the plan memory serves that I have a domestic trust issue.

Is that the case or has this issue been resolved somewhere in the past 15 years?

With respect to the auto enrollment failuires in this procedure, it says you "may use" the default investment fund. Can you still use the DOL's lost interest calculator?

I'm just envisioning a correction involving 15 people where you have to look up their fund based on their DOB and get all the invidiualized returns for each date range, for a fund whose performance might not be publicly available on yahoo because it's an insurance company wrap. This sounds like a horrible nightmare...

From 2015-28 (emphasis added by me):

(2) Calculation of Earnings for certain failures to implement automatic contribution features. This revenue procedure provides an alternative safe harbor method for calculating Earnings for Employee Elective Deferral Failures under § 401(k) plans or § 403(b) Plans that have automatic contribution features and that are corrected in accordance with the procedures in section 3.02(1) or 3.03 of this revenue procedure. If an affected eligible employee has not affirmatively designated an investment alternative, missed Earnings may be calculated based on the plan’s default investment alternative, provided that, with respect to a correction made in accordance with the procedures in section 3.02(1) of this revenue procedure, any cumulative losses reflected in the Earnings calculation will not result in a reduction in the required corrective contributions relating to any matching contributions.

All the best in 2016!

Where do you show distribution processing fees on your 5500's?

A thought came up here to include them on the Distributions line so the amount of distribs match the distributions report from the r/k system (even though the fees are not included in the 1099-Rs).

I've always included them in the Other Fees category.

Your thoughts are appreciated.

Plan excludes reimbursements or other expense allowances, fringe benefits, moving expenses, deferred compensation, and welfare benefits from the plan definition of compensation. (the usual)

The employer gives the employees money to cover the cost of their health insurance premiums. It is included on their W-2 and is taxable income. Would this come under any of the above excluded categories?

Facts:

-Immediate 401k entry for new hires, 1 yr match entry

-Based on % deferral rate election, ee can max out 401k early, but match will continue to be allocated on a payroll basis up to the 3% of pay

-New ee maxes out 401k prior to match eligibility, so no actual 401(k) is made after such date

Question:

1. Can ee receive a match somehow on a prorated 401k amount (ie 3% of pay since match eligibility)?

Can multiple distributions from an IRA within a 60 day period be rolled over as 1 amount in compliance with the 60 day rollover rule. For example.

Day 1 - $4,000 distribution (no taxes w/h) f/ IRA 1

Day 40 - $5,000 distribution (no taxes w/h) f/ IRA 1

Day 40 - $500 distribution (no taxes w/h) f/ IRA 1

Day 55 - $9,500 rolled over back to IRA 1.

Does this comply with the 60 day rollover rule?

Example 2:

Day 1 - $60,000 distribution (no taxes w/h) f/ 401k #1

Day 35 - $42.35 distribution (residual income) (no taxes w/h) f/ 401k #1

Day 55 - $60,042.35 rolled over to IRA #2

Does this comply with the 60 day rollover rule?

If example 2 complies, but example 1 doesn't, why?

In example 1, what is the maximum amount eligible for the 60 day rule?: $9,500; $5,500; or $5,000?

I would argue that regardless of the number of distributions within a 60 day period, the total amount eligible as 1 amount rolled over is the total amount distributed within the 60 day period as one continuous amount distributed over multiple days. Neither 26 USC 408, nor regulations under CFR 1.408 limit or define the number of distributions for 1 rollover.

Example 3: same facts as example 1 except IRA owner rolls over $9,500 to IRA #2 at a different institution.

Same result?

Other opinions?

Company has two 50/50 owners, who are the only HCEs (comps for all others below limit).

Owners want to start a 401(k) as a tool to recruit a certain class of their employees. They are not concerned with participating themselves.

In order to cover just the certain class of employees and exclude all others the Owners are ok with excluding all HCEs so as to not be concerned with the coverage test, which would be right around the 70% ratio if the HCEs were covered.

Should there be any concerns with excluding all employees, including HCEs, with the exception of the targeted group of NHCs?

Thank you.

Stuck with 2016 provisions in a 401k due to Safe Harbor. Is there anything that prevents me from setting up a second 401(k) with different provisions for 2016 and then just merging them together at year end? This seems like a solution for a company that wants to start PS contributions with a tiered formula when their old plan has SS integration.

Can I have a deferral limit = 5% of Compensation PLUS catch-up contributions for anyone eligible for catch-ups, but then have no limit for anyone else? Or would that be age discrimination?

I am told that the client is being told by a consultant that this taxable fringe benefit is not included in wages for the retirement plan.

Seems to me that if it is taxable to the individual and included in W-2 it would count.

Any insight on this?

Thank you!

If you're following States' legislation on using a play-or-pay tax to push an employer to make available payroll-deduction retirement savings, this link is to a bill pending in New Jersey's legislature.

http://www.njleg.state.nj.us/2014/Bills/A4500/4275_R2.PDF

It would, after a phase-in, impose a $500-per-employee tax on an employer that maintains no retirement plan and does not send payroll-deduction contributions to IRAs.