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Now I have a situation with the employee that switched from PPO to an HDHP as of 12/1/2025. We received the Qualifying event paperwork today 1/7/2026. We have also switched HSA vendors as of 1/1/2026.

• We give employees a seed contribution when they sign up for the HDHP. Would the seed money that they would have received for the month of December 2026 be able to be applied to 2026?
• If the employee would be eligible for the December funds, would we need to attempt to deposit that money through the previous vendor?
• How should any of this affect their taxes and W-2?

I have reached out to our HR department and they asked us if we knew what to do, so I would love some regulatory backup for any answers.

thank you

John

I haven't had to deal with this in a while.

We just had qualifying event paperwork, for an employee that will be shifting from a PPO Health plan to a HDHP. The effective date is for 12/1/2025. Our insurance plan years are 1/1-12/31 which means after 1/1/26 we have new rates.

Wouldn't refunding the employee in the current tax year for pre-tax benefits from the previous tax year also have tax implications?

I thought if this happens we need to give them a refund that would include any medi, and local (Ohio) adjustments calculated, and adjust their W-2 information to reflect the change in benefits for the 2025 tax year.

I can't find any direct information on this, so i came here.

thank you,

John

A 401k plan is a designed based safe harbor for both ADP and ACP testing; however, the plan allows after-tax contributions. The plan includes the match with the after-tax contributions to satisfy the ACP test (passes ACP just fine). 

My question is, how should Schedule R question 21b be answered (or 5500 SF 14b)? The question references both deferrals and match, without after-tax, the design would satisfy ACP. Thanks

21b If this is a Code section 401(k) plan, check all boxes that apply to indicate how the plan is intended to satisfy the nondiscrimination requirements for employee deferrals and employer matching contributions (as applicable) under Code sections 401(k)(3) and 401(m)(2).

_ Design-based safe harbor method

_ “Prior year” ADP test

_ “Current year” ADP test

_ N/A

As the title says I just came across a plan document that defines a Break in Service as any year the participant works <1,000 hours. 

I don't recall ever seeing the number of hours being more than the <501.   

I have tried looking up the code and regulations and I see nothing that allows it that high number of hours.    

Thanks in advance. 

A plan has a Partial Plan Termination in 2025. None of the terminated participants have a balance. Should the terminated participants be 100% vested (in case they are re-hired in the future) or not (since they don't have an account balance at time of termination)?

Thanks.

In a MEP, one of the adopting employers (AE) has said that they intend to leave the MEP soon - I don't know all of the details.  This was an informal conversation, no official formal notice has been given.

The owner of the AE followed-up by asking for some kind of trust report for the participants in that employer as of 12/31/25.  I presume the intent is to use that to bring to a new recordkeeper for pricing, conversion discussion, etc.  However, the trustee of the MEP has asked me to not provide this until we get a formal letter of the intent to separate from the MEP.

I don't think that's a tenable position.  Surely, the owner of the AE must have some rights to information?  They're not officially a "trustee" since they haven't signed a trust agreement (though maybe they should?), but since they do handle plan money...?

Obviously, it would be great if everyone would just play nice.  But in the absence of that, any ideas as to what I can lean on?  I'm perusing my basic plan document, but so far it's not that detailed.

Thanks.

UPDATE: I convinced the MEP sponsor to stop being difficult and I provided the data, so now this is just a theoretical issue.

401k/profit sharing plan.  Owner's 2025 W2 showing $96,143 in Box 1 and  $99,999.90 in Box 3 & Box 5.  Their pre-tax deferral amount in box 12 is $20,150.  In addition, their 2% S-corp shareholder employee health insurance premium of $16,293.32 is in Box 14 (other).  To get to their considered compensation for their safe harbor/profit sharing contributions do I add $96,143.22 + $20,150 + $16,293.32?  For some reason this one is confusing me.  TYIA! 

Plan sponsor dies and his daughter is the beneficiary. (Not sure if he is married or not, but assume bene designation was properly witnessed/notarized). Assume both a DB and a 401(k) plan.

If daughter is transferred the assets and rolls them to an IRA, I thought I read somewhere on this forum that the rollover assets continue to be protected from creditors - is that correct?  If not, is there any way to protect the assets from creditors?

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Has anyone heard from the IRS on the Cycle 4 filing?  I have some changes I want to make and was waiting for the first round of requested changes from them.  Crickets so far. 

I have an existing CB plan with NRD at age 65. Can NRD be changed to age 62 and what are the issues that have to be addressed?

With Revenue Procedure 2026-4, the user fee for a Voluntary Compliance Program submission after January 29 is $4,000. See page 245 https://www.irs.gov/pub/irs-irbs/irb26-01.pdf.

How much does the IRS user-fee amount (not the practitioner’s or service provider’s fee) affect your client’s evaluation of whether to do a VCP submission?

Participant is due $1.80 in earnings due to a late deposit of a loan payment.

How do I process that in Relius?  

Do I just do a Loan Payment for the participant and only allocate $1.80 in interest?  Will that mess up the amortization schedule?

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