The Chicago Bears currently play their home games at Soldier Field in Chicago, Illinois, where they have been based since 1971.  However, the team's Board of Directors has officially voted to advance plans for a new stadium in Hammond, Indiana, signaling an imminent relocation out of Illinois. 

As a result, the city thinks the owners are robbers and thieves. So, not unlike Cleveland they are seeking to retain the name "Bears' only for a team playing in Chicago. They have suggested coming up with another name. Appropriately,  "Bandits' come to mind and is used by a number of other sports teams. But that is not very original. They did a google search for thieves and came up with the following term.

yegg

/yĕg/

noun

A thief, especially a burglar or safecracker.

Since they are moving to Hammond, Indiana they will now be known as the Hammond Yeggs.

..............

sorry, another bad Poje Pun original.

I am going to use a simplified example.  One-person Cash Balance Plan, end of the year valuation.  Pay Credit in 2023 is $100,000.  Let's assume the interest crediting rate and all segment rates are 0.00% to avoid the actuarial noise. In December 2024 the Pay Credit is amended to $125,000 effective 1/1/2024.  The question is about what amount to exclude from the 50%-of-FT cushion calculation.  There is no impact for the 2024 valuation, I think this is clear.  For the 2025 valuation we have to exclude the $25,000 increase in FT on account of the Plan Amendment adopted within the 2-year window.  I think this is pretty clear as well.    But what about the 2026 valuation?  Do we get to exclude $50,000 from the FT (2 years' worht of the increase in Pay Credit) or do we calculate the 50% of FT cushion without any exclusions? Agressive me is thinking the full FT can be used since the 12/31/2026 valuation date is more than 2 years after the effective date of the amendment.  The conservative me is thinking that since the FT for the 12/312026 valuation is based on the benefit accrued as of 1/1/2026 I still have to carve out the Amendment from the FT for the 50% of FT cushion piece.  Thoughts?

A 401(k) has only 1 participant - the business owner.

The business owner contributed up to the 415 contribution limit in 2025 by contributing $23,500 in Deferrals and $46,500 in After Tax Employee Contributions (which were converted to In-Plan to Roth). However, the plan has a 4% Safe Match (that they fund at the end of the year), which must be funded (but the participant is already at the 415 limit).

Which source should the corrective distribution be made from and using which code?

Thank you.

This is straightforward but my conclusion does not seem to make logical sense:

Husband and wife each own 50% of Company A

Husband and wife each own 22.50% of Company B.  Other non-related businesses/individuals own the other 55%.

Under attribution rules, each spouse owns 45.00% of Company B.  That makes identical ownership between them 90% of Company B.  Since their common ownership of Company A is 100%, then there is a CG between A and B.

Does that sound correct?  They really only own 45% of Company B and it would not seem to be logical that that there would be a CG with them really only owing 45% of Company B

Any comments are appreciated.

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My client wants to reimburse an employee for part of their health insurance premium. A one-person Sec 105 seems the simplest way to go.  But...there are actually three W-2 employees, one of whom is full-time.  Those other two employees both wish to decline coverage as they already have full coverage from their spouse.  I don't see a way to separate them into classes.

Do the two eligible non-participants prevent us from make adopting the one-person 105?  At a $100/day penalty, I don't want to mess it up.

Thanks in advance

Hi,

Thank you as always for the insights.

The owner of Corp that sponsored A DB plan (traditional) passed away in July 2024 at age 61 and 8 months. The plans NRA is 62. The plan default (if no election was made) is first to the wife, if no wife, then the distribution goes to the children. 

The wife was entitled to a lump sum in 2024.  However, the election forms etc. were not finalized, not due to beneficiaries fault, until May 2026.

1. Can you calculate the lump sum as of 2024, and then give interest since the lump sum was not paid until 2026.

2.Or must you actuarialy increase the accrued benefit from 2024 until the payout date of 2026, and then calculate the lump sum as of 2026?

3. Or are both methods ok?

Thank you

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Looking for input from ESOP administrators, trustees, TPAs, and others familiar with ESOP distribution practices.

I left a privately held company about 18 months ago after nearly 20 years of service and am fully vested in the ESOP. Since my departure, the ESOP has repurchased/redeemed all of my company shares and transferred the entire account balance into cash/other investments. My most recent statement shows I now hold 0 shares of employer stock.

I have been advised that I will not be eligible for a distribution for several more years under the Plan's standard post-termination distribution schedule.

What makes this situation interesting is that, after reviewing historical statements, plan amendments, and participant communications, it appears the Plan may have changed how it handles terminated participants. Historically, former employees remained shareholders after leaving the company and continued to hold employer stock until their distribution occurred. In my case, the shares were repurchased shortly after separation and redistributed, while the proceeds remain held within the ESOP.

I have also found that the Plan has offered multiple special distribution programs to former employees over the years, including opportunities for terminated participants to elect lump-sum distributions before the standard distribution timeline.

My question is this:

From an ESOP administration and fiduciary perspective, what is the rationale for continuing to hold a former employee's account inside the ESOP after:

Nearly 20 years of service and full vesting;

Separation from the company approximately 18 months ago;

Repurchase/redemption of all employer stock from the account;

Conversion of the account into cash/other investments;

Prior Plan history of offering special distribution opportunities to terminated participants.

Have others seen plans move away from allowing terminated participants to remain shareholders and instead redeem shares immediately while still delaying distributions for years afterward? If so, what were the reasons for that change, and are there any avenues typically available for earlier distributions, rollovers, installment payments, or fiduciary review once the participant no longer holds employer securities?

I'm not arguing the Plan is required to distribute my account immediately. I'm genuinely trying to understand the administrative and fiduciary rationale behind redeeming the shares now, but delaying access to the proceeds for several more years.

A § 401(a)-(k) plan’s only participant dies without having begun a distribution, and before the plan, following Internal Revenue Code § 401(a)(9), required a distribution.

Assume the plan allows a beneficiary the widest possible choices about a distribution, with no more constraint than is necessary to meet § 401(a)(9) rules.

The participant had no spouse.

The participant’s beneficiary is not an eligible designated beneficiary.

The participant’s death was September 17, 2025.

Assume all possibly relevant years are the calendar year.

What is the latest date for the beneficiary to specify to the plan’s administrator any choices the beneficiary might make regarding the form of a distribution and when it begins?

What is the latest date a plan’s administrator may wait until, absent the beneficiary’s choice, one must impose the plan’s default minimum distribution?

I imagine I could sort this out by reading the tax law regulations, but I’m hoping a BenefitsLink neighbor can save me some time. Thanks.

We administer a Cash Balance Plan and a Safe Harbor 401(k) plan with 6 participants.

For the 2025 year they are failing the 401(a)4 nondiscrimination Test. To pass the test they could ideally bring one of their new employees into the 401(k) plan. Since he was hired toward the end of 2025 he only had about $10k of compensation. The company really likes this employee and would be happy to provide him a 25% profit sharing contribution and make him 100% vested in that contribution. Question: if he becomes an eligible employee via the 11(g) amendment, would it then be required that he also receive a safe harbor non elective contribution of 3%?

Under the plan all eligible non-key employees are entitled to a Safe harbor non elective contribution.

Thanks.

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I've never ran into this before.. If an employee is repaying a 401(k) loan and they don't have a paycheck for that payroll period what do you do? This is for an employee who doesn't receive regular paychecks. 

Participant dies in 2026 before the 2026 RMD is processed.

His stepsons are each 50% beneficiaries.

Do they each need to be assigned 50% of the RMD or can all of the RMD be assigned one beneficiary. 

The reason I ask is one beneficiary wants a taxable cash withdrawal and the other wants to roll to Inherited IRA.

 If all of the RMD is assigned to the cash withdrawal then the remaining amount can all be rolled to the Inherited IRA.

However, if all of the RMD is assigned to the cash distribution, that beneficiary would lose the ability to rollover those fund should they unexpected change their mind and decide to do a rollover within 60 days.

Hi

Helping a friend with a problem on a DB plan for a client of theirs.

One lifer DBP, slightly overfunded.

Decides to rollover all the assets into an IRA with no paperwork for termination and distribution election form. Not married.

Slightly overfunded as well.

How can this be corrected, assuming the plan sponsor wants out help? It is over 2.5M in assets, may be 50k or so overfunded which should have been rolled over into the existing DC plan under QRP rules.

I have not dealt with this in many years (sometimes luck can be on our side, rarely in this biz).

Before Vanguard exited its “Individual 401(k)” business, Vanguard sent a customer a “beneficiary verification” that included this information:

Beneficiary                  To the person I am married to at the time of my death

Backup Beneficiary     Benjamin Brother 50% / Roberta Relativebyaffinity 50%

Here’s what I don’t know:

Could the lingo “To the person I am married to at the time of my death” have resulted from Vanguard recording exactly what the participant typed in the website?

Or had a participant tried to type in that phrase, would Vanguard’s system have rejected the entry because it was too many characters or because it seemed not to be a name?

Did Vanguard set up that lingo as a programmed choice a user could click on?

Did Vanguard set up that lingo as a plug-in for a situation in which the participant declined to name a beneficiary and Vanguard’s records about a participant showed the participant as having a spouse?

In the circumstances I’m advising about, whether “To the person I am married to at the time of my death” resulted from the participant’s considered writing (which might be plausible because the participant had filed a divorce petition, and was lawyer-advised), or partly or wholly because of something Vanguard set up might matter in how the retirement plan’s administrator interprets the participant’s “backup” or contingent beneficiary designation.

BenefitsLink neighbors, thank you for your gracious help.

I'm curious to know the names of third-party administrators or recordkeepers who provide service to and have access to a non-ERISA governmental plan document that is keyed to Tribally relevant tax code and regulatory matters? Any help would be appreciated. Google doesn't give me enough to work with.

Best