We are using Corbel's VS.. The document currently gives total flexibility on match.

They want to do what was promised through August 31, 25 cents on 2% of match. On Deferrals starting September 1, they want to match 50 cents up to 5% of comp?

Is this legal or are there problems with this?

I have a participant directed 401(k) plan.

I plan to have money transferred into my account after the close of the market today so it will sit in my 401(k) plan account until Monday uninvested.

If I change my investment election of future money on Monday morning, will the investment of the money received on Friday night be invested in accordance with my new investment elections that I made on Monday morning or will it be done using my investment election at the time the money was received on Friday night?

Does anyone know what the rules are with this?

Thank you!!

Plan is changing to 501©(3) in October. What should I be thinking in regards to the plan or plan document based on the structural change?

here's the data:

Company #1:

Individual A owns 51%

Individual B owns 49%

Company #2:

Company #1 owns 75%

Individual C owns 25%

Is this a controlled group?

I was charting this and looking at the brother-sister rules and do 5 or fewer own 80% or more, effective control, controlling interest and my head began spinning. I know this should be easy but seems like I overthink or something and end up confused.

Any help appreciated!

Client changed payroll companies midyear. In the transition, their excluded compensation did not get communicated correctly to the new payroll provider. As a result, the year end census (used to calculate the match) overstated compensation for a number of people. This was not discovered until after the match was deposited.

Because of the impact that a correction will have on morale, the client is hoping to only correct those people who received more than $50 more than they should have received. However, 4 members of the plan's advisory committee who are involved in making this decision have asked that their accounts be corrected even though it would be less than $50. Two of them are HCEs, two are NHCEs.

Some of the people with really small amounts, end up with significantly higher match percentages. There are HCEs and NHCEs in both the group that they propose to correct and the group the propose to not correct.

I see lots of possible issues here. ACP passes with or without correction. I'm thinking of telling them the must correct for all the HCEs, regardless of amount, and for NHCEs whose percentage is more than some (as yet undetermined) amount higher than it should be.

What is a reasonable de minimus amount for a situation like this, given that the error is in the participants' favor?

Can this plan file the 2014 5500-SF?

Participant count:

1/1/2012 - 99 Filed 2012 SF

1/1/2013 - 117 Filed 2013 SF

1/1/2014 -- 108 ?

I believe they can keep filing the SF until they get over 120 participants.

1. The plan (a) covered fewer than 100 participants at the beginning of the plan year 2014, or (b) under 29 CFR 2520.103-1(d) was eligible to and filed as a small plan for plan year 2013 and did not cover more than 120 participants at the beginning of plan year 2014 (see instructions for line 5 on counting the number of participants);

Owners work their you-know-what's off but had no income to show for their hard work.

What do people think? In the testing as a zero, or not? I know it is a gray area.

Participant has comp of $10,000 and defers 100% (call it $9,235 after PR taxes). I believe we can give that employee a $2,000 profit sharing contribution if they are over the age of 50, because some of their deferrals will be reclassed as catch-ups, even though total exceeds 100% of pay. That's because 100% of pay is a 415 limit and contributions over the 415 limits are reclassed as cactch-ups.

Do I have it right?

Can a private school allow the 15 year catch-up provision in a 403(b) document? I have seen information that says only public schools can use the 15 year catch up, but other sources say both private and public schools can allow this provision. Does anyone know for sure?

Thanks.

Maybe some do this as a practice - file 5558's as insurance, even if return may be posted on time. Thinking it may be a wise thing to do in case there are system problems, etc.

So, suppose you have a bona fide "multiple employer plan" that decides to terminate. Do you see any "successor plan" problem if one or more of the individual employers then set up their own plans immediately? I'd think that there shouldn't be a problem because it isn't the "same" employer? I haven't yet done any research on this, just wondered if anyone had an opinion?

I have a situation where there are two components of a company. Lets call them component A and component B. Component A is the main company and component B is an operating arm of the company. The 401k plan is under component B's name. What are the pros/cons of having the 401k plan in one or the other?

I have a client who failed to include a non-cash item (trip) in the comp of several employees and therefore said employees did not have the oppty to defer on those bonuses. The plan uses the 415 safe harbor of comp with no exclusion of bonus.

I believe the only fix is to treat this as a missed deferral oppty and have the sponsor make the corrective contribution. (assuming employees aren't already maxed out, comp isn't above comp limit etc).

Any other creative suggestions?

This issue is not limited to cross tested plans, but I had to post this somewhere.

Discretionary profit sharing plan. Employer doesn't want to use the standard "last day rule" as a condition to receiving an allocation. It wants to have a rule that says the participant must be employed on the date that annual year-end bonuses are paid in December. This date is in mid-December, but it can vary by several days. In the employer's mind it feels that if an employer is entitled to a cash bonus than he should be entitled to a profit sharing contribution, even if he quits the day after. Anyone see anything wrong with the fact that the date is not a definite date but one that is subject to the control of the employer?

Do the same rules apply as in 401k plans with respect to 457(b) deferrals from severance? Or would it be permitted?

A participant chose to enroll in the plan 3 years ago. Let's say they chose to defer 4% of comp. From my understanding, a QNEC of 50% of that (2% of comp) needs to be made by the employer for these 3 years as well as any missed match/profit sharing.

My questions is this: the IRS states that this amount must be adjusted for the earnings. How do you calculate the earnings? There are two possible scenarios for this plan:

1) Use the earnings for the fully managed model the participant selected and calculate the returns for each contribution. This will take significant amount of work on the part of the TPA.

2) Use the VFCP Calculator for each pay-date. This will be a lot simpler to calculate.

Is there any guidance from the IRS as to which method is correct? What do you think is the correct method?

We are a large not-for-profit sponsoring 4 retirement plans. We have three vendors, 50+ funds, and no central recordkeeping system. We are currently using TIAA-CREF's Disclosure Assist product and are not satisfied. It is cumbersome to work with, unable to be customized for our needs, and results in a disclosure document in which is very hard for participants to find the information they need.

Can anyone recommend another product which would allow us to consolidate the information from three vendors into one document, and mail or email over 52,000 disclosures?

Participant terminated employment with a defaulted loan.

It is my understanding that if he does not request a distribution the amount of the outstanding loan is a "deemed distribution" and he includes the amount as income and is subject to 20% withholding and any 1099R would include the full amount of the outstanding loan.

At the time he requests a payout, the outstanding balance would be treated as an offset distribution and would be netted out of any actual distribution.

I just got off the phone with one of the fund companies that mentioned that they would give the participant a 1099 for the withholding only.

This just does not make sense.

The owner is over age 50 and wants to max himself out. He deferred only $4,000 for the year. Can he do a profit sharing contribution to himself of $53,000 and re-characterize the $4,000 deferral as catch up?

5558 extension on new calendar year plan (2014 first year) was filed back in late June.

The box which indicates "check this box if you are requesting an extension of time on line 2 to the the first Form 5500 series return/report for the plan listed....etc." was inadvertently not checked.

Would others go ahead and file another extension and check the box?