So the recordkeepers always enter "Recordkeeper" on their Schedule C reports under the field for their own relationship to the Employer. I believe the DOL has said publicly that that's not what they mean - they mean something beyond their relationship as a service provider (which relationship is already obvious).

Can anyone point to something? I already checked the 2 FAQs and found nothing...

I'm hoping to get some input if I rephrase my question - as I can't find the answer anywhere. Answer must be painfully obvious to everyone but me, as I can't believe this is an uncommon scenario!

Purely non-elective deferral plan (SERP agreement) already pays benefits on a separation from service due to death, disability or normal retirement. Is an amendment to also pay benefits upon involuntary termination an impermissible acceleration of benefits under 409A? I can't determine whether that's considered a modification to the timing of benefits or not.

My interpretation is that such an amendment would be a violation of 409A. I would appreciate any and all feedback.

Thank you!

Looking for advice. A 401k plan uses prior year testing for ADP/ACP. The employer hasn't matched for 6 years. The ACP test failed and the correction method is to refund 100%to all HCEs. I believe this is because the prior year's ACP is 0%. Is it possible to use the 3% that can be used for a first year plan? Can I go back to the last ACP test from 6 years ago? Has anyone had this situation? I'm not sure where to look for the answer.

Plan admin has documents identifying husband of participant as POA. Husband submits notarized application for benefit. He signs "her name by his name" but doesn't indicate "POA" or "attorney in fact." Is it OK to accept this notarized signature and process the application for benefits?

Hi. We have been advised that we should apply for a Trust ID for all of our plans that currently use their EIN as the TIN.

Is there a good reason to be doing this? Is there a requirements that a plan have a separate TIN? We had stopped as we had confusion in the past with TIN's being deactivated after non-use.

Thank you!

Non safe harbor 401k plan...

Plan was terminated and the assets were distributed during 2015. Later, it was discovered that one participant did not receive a profit sharing/matching contribution (between $1,000-$2,000).

The participant's account balance was rolled over to a new employer's 401k plan upon plan termination.

What is the best way to provide the missing contribution to the participant? I think it is best to have the plan sponsor write a check directly to the participant's new employer's plan as a rollover. The contract between the plan sponsor and the financial institution where the plan's assets were invested was completely terminated upon asset liquidation. So, there is no way to physically deposit the contribution to the participant's old 401k account.

Also, how should it be reported on the final 5500-SF (or maybe it is not final 5500 because it will have a receivable/ending balance for the amount of the missing contribution)?

Lastly, would the earnings calculation be required? Profit sharing was a discretionary (once a year deposit), and the matching was a discretionary per payroll calculation/deposit.

Thanks!

SERP currently is drafted to pay benefits upon the executive's death, disability or normal retirement. Can it be amended to also pay benefits upon an involuntary termination without violating 409A? My interpretation is No - is that correct?

We just took over the admin of a profit sharing plan that had been named "XYZ, PC 401K Profit Sharing Plan" SHNE, with the "discretionary" 3% (maybe) notice.

The plan apparently was not meant to be set up as a 401K, there have never been any employee contributions, the previous TPA prepared the document as a 401(k) with the discretionary SHNE "maybe" notice last year.

Since there have never been any employee contributions, is it possible to amend the plan currently to a profit sharing plan and not a 401(k) and remove the references to the 401K portion, which never existed in the first place?

Thoughts?

Do Medicare late enrollment penalties count as expenses paid for medical care under Code Section 213(d), or does only the standard premium fall into the definition of medical care?

We scrambled to get snap-on amendments signed and assets distributed before 4-30-16 PPA Restatement deadline. All participant accounts distributed and zero'ed out. Then, interest of $3.17 appears on 4-30-16. It gets swept to HCEs IRA on 5-2-16.

I'm about to file the final Form 5500. Can I file 4-30-16 final with a $3 payable, or include the $3 in benefits paid or file 5-2-16 final date? Is one automatically a non-amender on 5/1/16 if there's $1 left in the trust?

We have a 401(k) that allowed a person to start deferring before he was eligible, and want to retroactively amend for SCP correction. We are unclear as to the form and substance of the amendment:

1. Does the amendment name the specific individual(s) allowed in in error, or to all persons who would meet the amended eligibility criteria? (ex: change from 1 yrs svc to immediate entry is need to make that person eligible; does this apply to him, or to everyone)

2. Does the amendment apply only for those year(s) when ineligible person(s) deferred or prospectively from that time forward?

3. Using SCP, does this amendment have to be submitted to IRS for determination letter?

We have a 401(k) that allowed a person to start deferring before he was eligible, and want to retroactively amend for SCP correction. We are unclear as to the form and substance of the amendment:

1. Does the amendment name the specific individual(s) allowed in in error, or to all persons who would meet the amended eligibility criteria? (ex: change from 1 yrs svc to immediate entry is need to make that person eligible; does this apply to him, or to everyone)
2. Does the amendment apply only for those year(s) when ineligible person(s) deferred or prospectively from that time forward?
3. Using SCP, does this amendment have to be submitted to IRS for determination letter?

An executive passes away and becomes fully vested in 457(f) plan. Payment to be made to a beneficiary.

Could someone point me to how I can figure out the FICA, FUTA, Medicare taxes and reporting?

TYIA!

We're testing a cash balance and 401(k) plan. The plans have always passed the DB/DC gateway and general tests. This is the first year that the cash balance plan is using actual rate of return for the interest credit. Since the rate of return for 2015 was flat, the determination of accrued benefits for testing on an annual basis is causing the combined plan to fail (a)(4). However, if we calculate aggregate accrual rates on the basis of accrued to date for both the DB and DC plans, then the combined plan passes.

Question: Can the aggregate allocation rates needed for gateway be determined on an annual basis for both plans, while the aggregate accrual rates needed for general test be determined on an accrued to date basis for both plans? The consistency provisions of Reg. 1.401(a)(4)-9(b)(2)(iv) states that the measurement period must be applied consistently for the entire DB/DC plan. We are using the same measurement period for both plans, but we're using different measurement periods for determining allocation rates as opposed to accrual rates.

Thanks,

Cathy

We love doctors, right? Always want a million and one ways to lose their money! I digress...

One of the docs my wife works with at a local hospital mentioned to her about some changes to their plan, she referred me and I spoke briefly with him. Then the CEO called me. Physician's group, a couple dozen docs and another 40 or so EEs. They currently have a SH-k with PS (not a new comparability) on an insurance company RK/custodian, self-trustees with a producing TPA also giving investment advice but hiding under the (soon to be much more restrictive) 5-part ERISA fiduciary investment advice exemption.

They were approached by a competitor advisor who is recommending they move to a self-directed custodian so the docs can invest in whatever they want, including non-publically traded securities, real estate, etc. I do not even know of any such custodians for a plan with non-owner participants.

I am an RIA only, 3(21)(A)(ii) IA or 3(38) IM depending on the plan. Just so everyone is clear, my advice began with "NOTORIOUSLY BAD IDEA!!!"

While I am very familiar with SDBA options with custodians (I don't recommend them), but none I know of allow anything other than publically traded securities. I've only seen the door opened to alt investments with solo-k plans. My question is this: Are there even any custodians that will custody assets for non-solo 401(k)'s that permit alt investments, like real estate, non publically traded securities, etc???

Not to worry, I would NEVER recommend it, but I'm simply curious if anyone has come across a custodian like this.

Thanks!

A participant just discovered that her 401(k) deferrals have not been deducted from her paycheck since 2012. Our client has reviewed their files and agrees that they mistakenly did not deduct from her paycheck for that year. They are willing to make up and fund a missed deferral opp. from 2012. However she believes that they should be making up for all year since.

The client stated that they will not fund for 13,14,15 and 16 because they email employees every year requesting a new salary deferral form. This is part of their administrative procedures. Our client said that they have emails that clearly state that if they do not receive a new salary deferral form on Jan 1 of each year they will stop deducting and that the prior years form is no longer valid.

Questions:

1. Is there a statute of limitation of how long a participant has to bring up a missed deferral opp? Do they have to fund a QNEC for the missed deferral opp from 2012?

2. Aren't salary deferral forms, etc. administrative procedures? In other words, they can argue the fact that the emails they sent out clearly state that prior years form will not be valid and therefore will not need to fund a QNEC for 2013-2016?

3. Finally would we have to submit to VCP? I know there's a 2 year window for SCP, however isn't this considered a insignificant error so we can still self correct?

Thanks

This seems redundant to me, but maybe I'm missing something?

Base definitions. Plan defines comp as W-2. And of course as earned income for self-employed.

Plan also specifically (separately) includes "taxable welfare benefits."

Now, while I don't think this causes any harm, isn't it purely redundant? If it is a taxable welfare benefit for a W-2 employee, then it shows up on the W-2. If it is a sole prop, then it is earned income, which is what the plan uses anyway.

Is there any good reason to have this as a separate inclusion that I'm missing?

A participant is asking for a hardship of $20,000 although the recent tuition and related costs are being paid by Sallie Mae draws. The document says hardships are allowed for costs for the upcoming 12 months. She is needing help keeping up with the existing payments (and apparently other things would be my guess).

If she can document that she will be needing $20,000 of tuition and costs in the next 12 months (even though they will be covered by new loans) can the employer authorize the distribution? My thought is no, but if she has $20,000 in costs in the next 12 months, does what she actually does with the money matter to the employer sponsor?

I hate hardship distributions!!!

Thanks.

Is it possible to design a plan using a Safe Harbor basic match for anyone who is contributing and also simultaneously use a Safe Harbor non-elective for anyone who does not contribute?