I know if someone is funding the Safe Harbor Match on a payroll-by-payroll basis, a true-up is not required.  However, what happens if someone is inadvertently overfunded?  Does that money need to be pulled from the account or since it's on a payroll-by-payroll basis no adjustments are needed?

Thanks in advance!

I’m looking at an ATP STD program in Florida. No employee contributions. The administrator bills by participant for every activity they do, phone calls, emails faxes, consulting. The participant invoice show the amount of ATP services as taxable income to the participant. Can this be correct?

Hi

I usually manage to file 5500 forms for late adopters but there is one, could not do it.

So, for 2024, when filing the 5500 forms, I know I need to attach a copy of the 2023 SB.

A few things I am not clear about:

1. How do I attach a second SB? My program has a specific SB attachment option with additional sub-attachments for the SB attachments. If I do that, no issue

2. If above is not the right way then I need to attach under "other" option but with this option, I will not have sub-attachment options for SB which means all attachments have to go under "other".

Any suggestions?

Thanks

Is there a new option to contact someone at the DOL that you are working on putting together past 5500's, including this past year, and submit them all together at one time?

CPA seems to think there is. I don't think I missed something, or did I?

Hi there,

Are non-erisa church plans allowed to have adopting employers?  If so, are there any rules around why they may or may not be able to?  

I have a client who is a non-erisa church plan who acquired a new entity.  They have 100% ownership of said entity, however, the new entity will be maintaining its own EIN.  Can those employees participate in my clients existing non-erisa church 403b?

Thanks, 

I have a QDRO for a plan and it has awarded a dollar amount to the former spouse Alternate Payee.  

The date of segregation is 8/2/2024.

Is the Alternate Payee entitled to gains on that amount of assignment from the date of segregation until now?  I thought the answer was yes, but a co-worker felt that this might not be necessary.

Anyone confirm that Alternate Payee is only entitled to the flat dollar amount?

Note the plan's assets are held at Hancock, so we will move the amount over to an account for the Alt Payee until she fills out a distribution form.  Right now, I am trying to determine how much to move and split it over his 3 sources.

I have an ineligible employee who was allowed to defer prior to meeting eligibility.  I would normally just amend the Plan to allow early entry for this employee.  My only concern is that the Plan is Top Heavy.  Is there anyway to avoid allocating a Top Heavy Benefit to this employee?

Administer a 1 participant DB plan. Sent to us by an insurance agent.

When the plan was established 10 years ago, the life insurance was exactly 100 times the projected benefit. The client still wants to keep the plan but does not want to fund as much. Dropping the benefit formula will make the insurance more than 100 times the projected benefit.

What happens if the plan were audited and it was determined that the life insurance upon purchase and for 10 following years met the 100 X rule but now does not?

Thanks.

I passed my QKA exam last year and am now interested in taking the QPA exam. Could you please clarify if it’s possible to take the QPA exam without first completing the QKC exam, or if the QKC is a prerequisite?

I appreciate your guidance.
John

One-person plan that at one point had some assets - never enough to need to file a 5500-EZ.  All the money was invested in two limited partnerships... that went bankrupt.  So the two assets are literally worth zero.  Now he's terminating the plan, and I've got to file a 5500-EZ for the final year.  But it's going to start with $0 BOY; that seems like we're just asking for trouble.  Any suggestions other than to wait for the inevitable letter from the IRS?  Thanks.

If the benefit is distributed as an annuity for life, can it begin any time, even if the employee is still employed, without the employee incurring a 10% early distribution excise tax under Code section 72(t)? 

So hopefully I got your attention.   A medical practice agreed to convert their plan from RK A to RK B.  The plan has several self-directed brokerage accounts that are offered through RK As recordkeeping system so everything is (was) working fine.  Upon notification that the plan was leaving RK A told the Plan Sponsor that all assets in the SDAs would need to be liquidated and the cash transferred to the core accounts to then be liquidated and transferred to RK B.  Dr. X, who is a partner / member / owner, but not a majority owner, refused to liquidate his positions because he has a specific Russian ETF that is illiquid and represents a $250k unrealized loss. The fund is actually in the process of being liquidated by the fund company, but there is no known timeframe for when this process will end.  The Plan Sponsor still wants to convert from RK A to RK B but is at a standstill due to Dr X's refusal to liquidate his account.  Dr. X is not eligible for in-service withdrawals so he can't distribute in-kind shares to an IRA.  We have politely told him that he is potentially creating a fiduciary issue since he is taking his personal account into consideration and not doing what is in best interest of plan and other participants.  Can anyone chime in with thoughts on how to proceed? If at all?  Maybe I shouldn't want this plan, but the rest of the decision makers are great and they are VERY frustrated with Dr. X.

Sponsor filed 5500-SF in July, so on time.  

Sponsor could have had the automatic extension due to extended tax return, but didn't need it, and the 5500 doesn't reflect it (after all, why would it, since it was filed on time?)

SAR is due 2 months after the 5500 deadline.

Can that still be 12/15, or does it have to be 9/30 specifically as a result of not checking the automatic extension box on the 5500?

Hmmmm......

--bri

We have 2 clients in this situation both changed payroll companies in 2024.  

With the small client 10 participants, I can probably get actual earnings for the multi-month period and reduce by 50% (since funds would have been deposited evenly pro-rata over the period.

Then there is the large client 150 to 200. Getting actual earnings for the late period is not possible.  I know some will say you cannot use the DOL calculator unless you file with the IRS. I see no other practical option.

I don't why this has to fall on the TPA to fix when it is the payroll company responsibility and plan sponsor to monitor.  I told the small plan sponsor - what do your corporate accounting records who - there should be a 401(k) liability - withholding less payments to the plan. Accounting probably not kept current. (I know whining doesn't help.)

Thank you,

Tom

Company and participating employers are consolidating benefit plans so that all employees participate under one plan.  As a result, premiums will increase for some employees.  Company would like to understand if it's possible to pay certain employees a stipend on a pre-tax basis that is used to cover the increased premiums.  The plan is self-insured, so my thought is that providing this payment to some employees and not others presents some discrimination issues.  Also, if the stipend is paid through payroll, can it be deducted pre-tax to pay for the cost of premiums?  

A participant worked at Company Z & terminated employment at age 60.  At age 72, Company Z's plan began paying out RMD's from his account.  Participant zeroed out their account (rollover to IRA or direct distribution) 5 years later.  EE is rehired at age 80 and has no plan balance.  EE begins deferrals.  Does he get an RMD from his new deferrals or because he is currently employed, he does not need to receive an RMD from this account as it was previously zeroed out?

DB plan terminated a few years ago. An annuity provider was established in terms of transferring the pension benefits. It was discovered that an individual (who was already in pay status when the plan terminated) was overpaid. In terms of trying to collect those overpayments, do the provisions of SECURE 2.0 apply?

I have come to really dislike RMD questions. However, here goes:

Participant dies in 2023. Already taking RMD's. Spouse, who also works at the same company and is a participant, took his RMD in 2023, and then "moved" the balance of his account to her account in the plan. She is younger - late 60's. As I understand it, she can treat this money as her own, and no further RMD's are required until HER RBD. Have I got that right?

We have a client ABC with a SH 401(k) plan.  I just received word they are acquiring company XYZ that sponsors a SIMPLE IRA.  It's an assets purchase which will take place 9/30/2024.

I don't know if ABC wants to recognize service worked with XYZ in meeting eligibility.  I think that is likely.  

So, the 402(g) deferral limit would apply as combined for any SIMPLE deferrals and deferrals under the 401(k) plan for 2024. ABC only funds a 3% non-elective SH.  I'm guessing XYZ funds the SIMPLE match.  

If we sweep into the ABC plan XYZ employees who meet ABC eligibility, would the 401(k) funding be as simple as providing the 3% SH for ABC 12-months and former XYZ employees for 3-months?

I believe there is some flexibility in testing in the case of acquisitions.

Thank you!!

We sent all our 5558 extensions in one package for 12/31 on 7/30 as we always do.  About 60 of them by priority mail on 7/30.  Today one of my clients received a letter stating they were denying the extension because it was received late.  Here's my issue, I can't find the tracking receipt ANYWHERE.  It was on my bulletin board and now just vanished.  Sooooo was it just this one that got separated or my entire package.  I have two things, one my bank statement that shows my charge at the Post Office on 7/30 as well as the screenshot of where all my clients needing one were generated on 7/30.  I tried going to the Post Office to see if they could back track and provide my tracking number but some new person was there and I have to go back and speak with the Postmaster.  At any rate, has anyone had this happen? and do you think they'll accept what I have noted above to abate any penalty considering we have never filed a late return or extension.  I am praying this is a one off and that it just got separated from the package.  I've had plenty of instances over my 30 years where they say they haven't received the extension, I've sent it in, and never heard another thing and never included tracking, just sent it to them.  Thoughts?  Anyone else receiving these notices so far? Would you do anything else other than respond right away with what I mentioned.

Thanks!