If a plan document limits deferrals to 50% of compensation, and a participant makes $36,000 but is catch-up eligible - and wants to contribute the max she can - would she be able to defer 18000 plus the 6000 for catch up or would she be

limited to just 18,000 for 2015?

Hi. Our school division uses Lincoln as the vendor for our 403(b) Plan. Lincoln has recently asked us to provide names, addresses, dates of birth, SS#s for all employees of the school division. Obviously, this is information Lincoln will have and need for those employees that have already elected to participate in the 403(b). But Lincoln is also asking for this information to be provided regarding employees that are not participants for purposes of education and marketing to them the benefits of participating in the 403(b) plan.

Are we permitted to share this information with Lincoln?

Thanks.

Here's the scenario:

Company 1- Owner A 50%

Owner B 50%

Assistant

Company 2 - Owner A 25%

Owner B 25%

Owner C 25%

Owner D 25%

Owners A & B want to start a separate 401k plan for each company. In company 2 they also want to do a profit sharing contribution to try to max out their contributions. They don't want to do a profit sharing contribution for Company 1 because they don't want to pay the 60 year old assistant a profit sharing contribution.

Is this possible? Can they have 2 plans with different provisions? I seem to think that what they do with one company, they have to do with the other.

Please advise.

I've got a plan where the match is 100% of the first 4% deferred (as a safe harbor match) + 0% on the next 4% deferred + 50% on deferrals from 8% - 15%. I know, it's weird; the plan initially had 50% on the first 15% but kept failing ADP, so someone converted it to a safe harbor, on the idea that "front-loading" the first 8% into 4% was beneficial to the NHCEs.

No surprise, the additional match formula is where I'm having the problems. Not only is it failing ACP, but I wonder if I might have a b/r/f problem as well. 2/2 HCEs defer enough to get this match, but only 2/14 NHCEs do as well (we had several new NHCEs this year that really changed the demographics).

Is this a problem? And, if so, how can I fix 2014 (and presumably 2015)? Some kind of QMAC to bring more of the NHCE's up to 8%+ deferred?

Thanks.

I’m interested in learning more about how Plans account for fee disclosure change notices during their transition to a new provider/recordkeeper. As transitions can take a few months to work through Plan details, determine new fees (plan level and individual fees), and finalize how the investments will transfer; it seems having the change notice to participants 30 days prior to their first opportunity to choose investments could be tough.

Does anyone have experience with these notices and how you've handled it in the past, specifically when the assets are “mapping” to new investments and the blackout begins about a week prior to the effective date. In this scenario participants wouldn’t have access to their accounts until after the blackout ended.

Have a plan that calculates their match on a per pay basis. Paid Monthly

Lets assume Joe Employee makes $84,000 per month and defers 401k of $1250.

Their Match formula is 100% up to 3%. My calculation shows Joe would get $1250 in match per month.

My question is do we have to cap his match to $7,950.00 (265000*.03) or does he get the full $15,000.00? More specifically with respect to tres reg 1.401(a)(17)-1(b)(3)(iii)(B)

We are a governmental agency and have a defined benefit plan whereby employees are required to contribute a % of pay.

We have a temporary employee who inadvertantly had the pension amount withheld from her paycheck for 2 tax years (2014 & 2015)

She has terminated employment and is asking for a refund of those employee contributions.

I mentioned to payroll that thye would have to refund the contributions withhled from her paycheck

They said they could not due to being 2 tax years

We do refund those who terminate non-vested their employee contributions plus 4% annualized interest. We do not have an account established for each employee.

Our attorney is saying she cannot be refunded through the pension plan and get a Form 1099 distribution

But Payroll Mgr isn't budging

Any alternatives?

thanks

Lexy

1.)the 5500 instructions describe who is a participant. for active employees the phrase earning or retaining credited service is used. In the EZ instructions we read that it must cover only and owner and spouse (or partners) and provide benefits only for them. Does earning and retaining credited service equate to covering? Suppose a historically one person profit sharing plan now has a common law employee for 2014 but no contribution is made for 2014. Can an EZ be filed for 2014? The newly eligible ee is not retaining or crediting service and has no benefit.

separate question..

2.)an IRS notice is received by plan sponsor querying the absence of a 2013 5500 filing..in reality a 2012 return was also not filed but no corresponding notice has been received. Is it likely that a 2012 notice will come at a later date or was the 2012 unfiled return not picked up...any guesses or thoughts?

We have taken over a 401(k) plan which had a deemed loan for missed payments. From what we could see, the plan had the normal cure period listed in the plan documents. Loan amortization schedule was based on bi-weekly payments but employer payroll frequency was semi-monthly and neither the recordkeeper nor employer caught this discrepancy. Employer submitted payments semi-monthly. The recordkeeper had instituted an Auto Default/Deem loan process if loan payments were not up-to-date and deemed the loan without notification to the participant or plan sponsor. The end of the cure period is 9/30/15 according to the RK but loan was deemed 7/1/15 and the participant was not given an opportunity to bring it up to date.

Should the RK have amended the plan document/loan policy for the Auto Default/Deem procedure? No updated SMM's or SPD's have been provided. The only documentation is a letter to the plan sponsor. RK says it following IRS regulations; however, it doesn't look like it following the terms of the plan as far as i can tell. I'm not sure if the loan agreement disclosed the terms of the auto default process. They claim they cannot correct or reverse the 1099 which is hard to believe.

I am advising a client that will soon be involved in the spinoff of a subsidiary. For various reasons, both buyer and seller are interested in the transferring employees remaining on sellers plans for a period following the date of the transaction. The client's vendors are advising that this arrangement is common and does not create a MEWA since the arrangement won't last beyond the end of the plan year following the year of the termination. Although I agree that the arrangement would be exempt from M-1 filing requirements, I view the arrangement is still a MEWA and am concerned that no exception to any applicable state laws would apply.

Have any of you heard of/participated in these types of arrangements? How have you dealt with state laws on MEWAs that would seem to have no exception comparable to the M-1 filing exception?

Plan terminated and paid out in 2012. In 2015, plan has an expense recovery of $56,000, which needs to be distributed to 75 participants. What are the mechanics for re-opening the trust and handling the payouts so that they can be rolled over?

Can (or is) a church plan with multiple employers also be considered a Multiple Employer Plan (MEP) or a Multiemployer plan? Thanks for any help.

The financial institution who is the recordkeeper for a 401k plan with self-directed accounts replaced its money market fund with another MM fund. The amount involved was more than 5% of the plan's BOY assets but I am wondering whether this must be reported on line 4j, as it was an involuntary transaction on the employer's part.

Also, if it must be reported, the required attachment for line 4j asks for the purchase and sale prices as well as the cost and the current value of the asset on the transaction date - are they not the same thing? Or is the purpose to find out whether the purchase or sale price differed from FMV? N/a in this case since share prices of both cash funds were always $1, but just curious about the redundancy.

12/31/13 - Local division files their medical plan 5500 with 1000 participants.

1/1/14 - Corporate office assumes the Medical plan and considers it part of their own welfare benefit plan

Seems to me that 2013 was a Final filing, but there were over 0 participants. How would we close it out?

This seems to be a very basic question but I am now having

"third-thoughts".

Employer asks us to review a Top Heavy safe harbor match 01(k) that another TPA firm currently handles.

No employer contributions beside the safe harbor match.

OK, but there are a few employees that have met the age and service requirements and have opted not to defer. OK, no match for these participants.

Since the plan is top heavy and these people are eligible and were

employed on the determination date, must these individuals receive the top heavy minimum 3%?

We say yes, the current TPA says no and this is the way they

"handle" all their 401(k) plans and has the audacity to back-

up the claim by telling me she has "many years as a TPA"; and has

requested the citation from us.

So, I'd like to know where to locate a cite.

Is it legal to Add safe harbor 401(k) to profit sharing mid year?

I have a prospective client that wants to do one plan for two employers. There is common ownership, but it is not a controlled group.

ABC is an engineering firm.

XYZ is a mechanical, electrical and plumbing contractor.

ABC provides traditional engineering services for XYZ and XYZ provides design for constructability and budgeting services for ABC (in addition to selling work for ABC).

Any thoughts are whether this is an Affiliated Service Group?

Ok, my brain is drawing a blank. Plan was frozen in 1990, person attained NRA (age 62) in 2003 and is still working.

To do the AE increase, do I start at age 62 or do I start at age 65?

Same question if we do a suspension of benefits.

Thank you from the brain frozen.

Plan Trustee (and owner of a financial advisory firm) wants to give his employees investment advice. He wants to have one of his employees (a series 7 advisor) serve as the registered advisor. Is this possible? The payments would flow through the advisory firm itself but the employer would not take a cut, it would just be a pass through (because it has to go through the broker/dealer, etc).

It seems to me that the Schedule C instructions refer to employees who receive wages for their services to the Plan. That is what we are going for here.

Is this possible?

This has been discussed on these boards, but some conflicting opinions from elsewhere have made this.

IRC §4975 does not apply to an ERISA 403(b) plan, but ERISA 3(2) includes
403(b) plans. That, in turn, makes an ERISA 403(b) plan subject to the prohibited
transaction rules, but not under 4975, under ERISA 406.

Does this cause an ERISA 403(b) plan to be subject to an excise tax that requires Form 5330, thus completing the section of the form under 4975 and paying the 15% excise tax?