Can a participant name a non-for-profit company as their beneficiary?

Plan was set up in 2014 with an age 21 and 6 mo of service entry requirement, monthly entry dates.

I found out this week that the census I was provided was not all employees, just those who participate, even though our form requests all info.

1 part timer apparently went full time this month and the client asked me if she has to wait 6 months to get in since she was hired in January 2014. This is how I discovered this problem. The annual val and 5500 is complete and filed.

We are waiting for a corrected census from the client. Isn't the correction for the ER to fund a 3% deferral for those ees that were not offered the plan timely? This is a deferral only plan.

We have a 0% MPPP where the owner and his spouse have rollover money. There are no other funds in the plan. The plan document should have been drafted to exclude all other employees but was not. The plan would like to file 5500-EZ rather than 5500-SF.

Can the document be amended retroactively as of 1/1/14 excluding all other employees (without filing under (VCP)? Seems that it should be okay as no employee is losing their 0% "accrued benefit."

Thanks!

I have a plan sponsor who is a non-amender and needs to go through VCP. The last document we found is a "Super Simplified Profit Sharing Plan" Adoption Agreement signed in 2002 provided by Oppenheimer Funds. Does anyone have access to the Basic Plan Document for this Adoption Agreement? I know this is a long shot!

Plan permits participants to take out participant loans at 0% interest. Is this commercially reasonable? If not, are the loans prohibited transactions? If so, do the participants have to repay the entire amount of the loans back to the Plan before the prohibited transaction can be treated as corrected? Or can the interest rate on the loan be renegotiated without the participants having to actually repay their loans?

A recordkeeper has just set up an excess revenue account for a client, but is including a one-time deposit that represents excess revenue from 2014 that was collected but not credited to the plan until now.

The client has already paid their 2014 invoices but would like to be reimbursed for 2014 fees they paid for qualified plan expenses (i.e, to auditor, accountant, etc.).

What are your thoughts, is this doable?

Hello,

We have a couple employees that have contributed over their allowable amounts for the FSA as they have been classified as Highly Compensated Employees. I understand the refund must pass through payroll. Should the amount be taxed as a supplemental payment or as a regular payment that is taxed through the tax tables?

Thank you,

I need some help/confirmation that I will be doing coverage and nondiscrimination testing correctly for the following situation:

3 DC plans - all plans cover all employees.

1. PS/K 21 & 1

2. MP 21 & 2

3. PS 21 & 2

Plan 1 meets coverage on it's own and the PS contribution is that same % for all.

Plans 2 & 3 combined and x-tested.

For 2 & 3 the combined plans pass the ratio percent test but need the ABT to pass rate group testing.

Questions re plans 2 & 3 testing:

1. Can all employees with less than the 2 year eligibility be excluded from both the ABT and the a4 tests? (In other words, someone that has 1 YOS but less than 2 YOS will be "excludable" rather than "not benefiting".)

2. Should the ABT benefit % include the K & PS benefits from Plan 1?

Thank you to anyone that replies.

I have encountered a multiemployer welfare plan which only offers a one-size-fits-all coverage option; in other words, there is no "self-only" coverage option. I assume this means I must consider the employee contributions toward the cost of the one-size-fits-all coverage option when determining ACA affordability (if so, the plan is VERY unaffordable - employees pay around 30% of wages for coverage)?

Certainly, employers/plans can't circumvent the ACA affordability standard by eliminating the self-only coverage option, right? I checked regulations, etc. and didn't find anything that addressed this situation.

Would appreciate any thoughts, etc. Thanks!

Has anyone been successful at correcting a 401(k) plan for violating the contingent benefit rule? If so, what was the applicable correction?

Bunker Hill

Watergate and the alert Frank Wills

OJ and the slow moving white Bronco (aka John Elway Day)

.. OK, back to work.

A participant filled out an election form and elected 10% to be withheld while another participant filled out the EF electing 0% withholding. The employer switched the participants deductions so the 0% participant had 10% withheld.

Is a refund necessary to the 0% participant or is there a different solution for this?

Every year we are required to send a list of assets to Participants. It is supposed to have a Diversification notice attached.

My question is, "Is there a requirement to have any plan provisions on this notice?"

I understand that the definition of compensation for the SHNE contribution must be a 414(s) safe harbor definition or another definition that can pass 414(s) using the compensation ratio test.

However, what about the definition of comp for the salary deferrals? Can that definition be different than the definition for the SHNE?

For example, could a plan exclude bonuses for deferral purposes (for administrative convenience), but include bonuses for the SHNE (to insure a 414(s) safe harbor definition)? Let's also assume that excluding bonuses from comp would NOT pass the ratio test of 414(s). So, my deferrals are using a "reasonable" definition under 414(s), whereas the SHNE is using a 414(s) safe harbor.

Employer wants to allocate the profit sharing contribution as follows:

1. Less than 10 years of servive $0

2. 10 years but less than 15 years $1,500

3. 15 years but less than 20 years $2,000

4, 20 years but less than 25 years $2,500

5. 25 years or more $3,000

Plan is not Top Heavy

Plan will pass coverage.

Are there any issues with the allocation formula.

Client isa willing to submit for IRS determination letter.

Thanks

1. SEP vs. solo 401k for SE income. If he were under 50, then if he nets > 265K I would say a SEP is better b/c it would allow the full 53K contribution and would be administratively simpler than a solo K. But b/c he is over 50, should he do a solo K even if he nets > 265K, so he can do the extra 6K catch-up contribution, which I don't believe is possible in a SEP?

2. Retirement contribution on real estate income. I don't encounter this very much b/c many real estate investors reinvest everything into more real estate. Here are a few thoughts/questions, looking for reactions:

Company A has a Cash Balance Plan with the standard age 21 and 1 year of service entry requirement. Entry dates are semi annual.

The benefit formulas for the groups involved are % of the determination period Compensation for the Plan Year. A participant must work 1000 hours in the Plan Year to get an allocation.

The prior actuary filed the Schedule SBs with a beginning of year valuation date. Thus, for example, the Plan had a contribution allocation on 1/1/2014 of $x dollars which included John Doe who did not enter the Plan until 7/1/2014.

Seems odd to me, but I am an old dog and not prone to understand new tricks. My preferences are for a beginning of year valuation to be based on the 12 months prior to the valuation date.

Is this anything to be worried about?

Thanks for all guidance provided.

Employer wants to allocate a profit sharing based on the following schedule:

Less than 10 years $0

10 years to 15 years $1,500

15 years to 20 years $2,000

20 years to 25 years $2,500

25 years and more $3,000

Plan is not TH.

Plan will pass coverage

Issues with this allocation???

Sounds to good to be true. Need to know if I am missing something.

Company Big buys the stock of Company Small, closing date of 7/15/2015. Company Small will resolve to terminate the plan on 7/14/15 and will then proceed to pay everyone out. We are being told that at some point, the non-respondents can be transferred to Company Big's 401k plan, essentially in place of the force out IRA's.

to me, this seems ridiculous, because really what happened is we allowed all of these active employees to close out heir accounts (before age 59.5), with the pre-existing knowledge that the plan was in fact going to be merged into the parent company's plan. In other words, the original plan was to merge the two together with the added step of first paying out everyone who otherwise would be ineligible for a distribution in the event of a merger (i.e., due to the 12 month rule relating to terminated 401k's).

Am I missing something?

Here's a new one to me. Plan deferral procedures and deferral forms specify that

all deferrals, whether by percentage or by flat amount, will be deducted twice monthly (24 pay periods per year) even though they actually do bi-weekly payroll (26 per year.)

Match is on a "per payroll" basis. Not a safe harbor plan, not top heavy.

Although odd (in my experience) is there really a problem with this? Plan is allowed to establish deferral procedures, so do you foresee problems for an auditor with this practice? Assume no HC, so no possible testing failures involved. Seems to me that this should be ok, even though it feels a little funny in that plan definition of compensation doesn't specifically refer to this. But for a flat dollar deferral amount, the number of payrolls is ultimately immaterial, and for a percentage, as long as forms clearly specify that it is for 24 payrolls only, participants know exactly what they are signing up for.

Any thoughts?