Can an employer for a SH Non-Elective plan make it per pay period without a true-up?

I'd appreciate help here.

I have a 100% vested qualified plan with a proposed revocation of tax exempt status.

The reason for the revocation is that even though the plan terminated and received a 2008 termination letter from the IRS, full distribution was not made soon enough. The IRS deemed the plan to be "ongoing" rather than terminated, and now wants revocation based on failure to update.

No contributions were made since 2008.

If tax exempt status is revoked as of 2010, are the employees taxed on 100% of the plan value or just the contributions made after the date (none)? The client was highly compensated but the plan was in full compliance when terminated in 2008.

I have seen articles with both answers.

THANKS!

Jeff

We have a client who changed their trustee and TPA in 2013. During a 5 week period while the conversion took place, the employer issued a blackout notice. During this period, no employee deferrals where deposited. The deferrals were April 2013 deferrals and were deposited by May 15, 2013. On average, April deferrals where deposited within 21 days. For all other payrolls, the client deposited deferrals within 1 to 2 business days.

Do we have a problem here? I haven't started my research and am not sure if a blackout notice covers deferral deposits. The employer was told to not make any deposits until the new TPA & Trustee had the client's records in order. Looking back, the client regrets not opening a temporary account in the name of the Plan.

Thank you for your help.

How do I characterize an IRA that has escheated to the state? Is it a disribution reported on a 1099? Is it simply a transfer of some sort? Any help would be greatly appreciated!

Surfing the EFAST2 website came across a 5500 Schedule I (Small Plan) reporting:

3a $900,000 of Parnership/Joint Venture interests

4e $500,000 Fidelity Bond

4k Claiming qualification for audit waiver

Since the bond is less than the non-traditional assets doesn't this plan have to have an IQPA audit?

In Alb., NM and need an experienced 401(k) administrator but no response to local ads. Where online would be the best place to post a position? Don P

Thanks very much to Effen for pointing out a problem with the message boards search engine, which now has been fixed.

The search engine was ignoring 3-letter words, such as "HCE". It was paying attention to words of 4 or more letters, but the 3-letter words got the cold shoulder.

Words of only 1 or 2 letters continue to be disregarded, though, because they would cause the search engine to bog down.

Another technique is to use Google. You can focus all of Google's processing firepower onto the message boards by including the phrase "site:benefitslink.com/boards" (but without the quotation marks) as part of the query you enter at google.com (or in your browser's Google search bar, etc.). For example, to see topics that contain messages about the HCE compensation limit, type this into the box at http://google.com:

HCE compensation limit site:benefitslink.com/boards

(Note how no blank space appears between site: and benefitslink.com, and no blank space appears between benefitslink.com and /boards.)

You might want to bookmark this page:

www.google.com/?q=site:benefitslink.com/boards

which will pre-fill the box with the magic site string. You'd then add your desired word or words into the box before clicking the Google Search button.

I think I know the answer but want to be sure.

If an IDA participant in a small plan has an LLC investment, does this mean that 100% of the assets are not in qualifying assets and long form must be filed. The LLC is held in custody by the IDA custodian (an RFI) but the LLC does not have a readily determinable market value. I was hoping maybe there was an exception for participant directed IDA investments that would allow us to continue to be eligible to file an SF.

Thanks

ok this may be retirement plans 101 but for some reason we can't seem to figure out the answer.

Two examples:

1. Company A sponsors a plan, they buy Company B. Company B doesn't have an existing plan and adopts Company A's plan. Let's assume the Company A is owned by one owner (100%) but company b is owned by 5 owners - owner of company A included. For plan purposes when we are determining ownership do we look at the other 4 owners of company B to determine for example if they have to take an RMD. In other words do we look at what the ownership is of Company B even though Company A sponsors the plan.

2. Same as above but let's say Company A and Company B are affiliated employers. Company A sponsors the plan and Company B adopts company A's plan. No like ownership but they are an affiliated service group. Do we look at the owners of company A and B for plan purposes or only A since they are the sponsoring employers.

First time I have a Plan that did not start 401(k) deferrals for 2 employees. The Company put in a QNEC contribution for the 2 employees. Would the QNEC amounts be considered late deferrals for purposes of Form 5500-SF question 10a? Or would the QNEC itself take care of the issue? TIA

A company maintains a calendar year SH 401(k) with 3% Nonelective safe harbor contribution.

They just informed us today that their firm will be acquired tomorrow (always nice to be informed at the last minute).

If they terminate the plan now, our understanding is as follows:

1. They do not need to provide advance notice.

2. They need to provide the 3% SH contribution based on compensation through the termination date.

3. Participants do not need to be given the opportunity to change salary deferrals.

Questions:

1. Are they required to pass the ADP test from 1/1/14 through the date of termination?

2. Since the firm that is acquiring them also sponsors a 401(k) plan, would there be any problem with distributing salary deferrals (the one year rule)?

Thanks.

A ps plan that had 2 participants, now 1, has the gist of its assets wrapped up in a farm valued at appx. $400,000. In order for the plan to terminate, he would have to find a buyer, which could be him as the sole participant or someone else. I know an IRA can own real estate, but could he roll over the value of the farm into an IRA?

WIthin a 403(b), since there is not a ADP test that is performed, can HCE's contribute at least $17,500 without worry of receiving a refund? Or is there some other type of test performed to avoid discrimination on the deferral side if the NHCE's are not deferring that much??

Can you aggregate a SEP and Cash Balance plan together?

If for the past 2 years, a client has been making 401(k) deferral contributions on behalf of an employee on leave out of post-tax payments that are not allowed to be used for 401(k). The employee has no other income from the client to make 401(k), and therefore should not have contributed anything.

What is the correction method?

Are there multiple ways to correct?

Do you have to file anything with the IRS or can you self correct?

My experience with excess 401(k) contributions is to refund the money and earnings as ordinary income, but that was for contributions over the $17,500 limit. I am not sure if it is different if all of the 401(k) contributions are disallowed, and if it spans multiple years.

I have been running this pension and investment sales and administrationTPA business for 40 years, and I now want to sell.

I am still full of pi.s and vinegar and want to continue in the business, but must relieve myself of being an owner and the owner responsibilities. I just want to be a rainmaker, consultant, expert witness, problem solver, etc. but I do not want the responsibility of running the business.

For almost the full 40 years we have received our business as referrals from CPAs and Attorneys. Hardly any from financial sales people. We are also an RIA and receive fees for investment advising and either insurance commissions or RIA fees on most all our 401(k) business.

I believe that I have developed the method to easily get business from CPA firms and Law firms. The method is easily taught to quality sales people and will generate business quite quickly. But frankly, I want to go "elephant hunting" for the larger more mature 401(k) plans rather than get the smaller cases from the CPAs and Attorneys. I have been working on a new marketing plan that is close to being ready to go, but I would like some help from a buyer of my firm.

Although at one time, my firm was more than twice as large as it is now, I think the firm and myself are worth a look. I have extensive experience, am highly educated (MBA from U of Michigan), fully credentialed (Certified Pension Consultant and many more), founded a local bank that we took public onto the Nasdaq at 36 years old and on the Bank's Board for 23 years until we sold it for cash before the bank crash of 2008), am considered an innovator and am also an idea a minute kind of guy.

Do you think I should use an M & A firm to find a buyer or should I try to find buyers myself. If you have any recommendations, please let me know.

You may reach me at 248 342 9500 because I do not know how people communicate with each other that meet on this forum.

You can use SCP to correct by plan amendment in just a few circumstances specified in Rev. Proc. 2013-12. One is where you have allowed hardship withdrawals (on a nondiscriminatory basis), but the plan didn't permit hardship withdrawals. You can amend retroactively to permit the hardship withdrawals allowed, without going through VCP.

What if the plan did allow for hardship withdrawals, but in operation you allowed them on a more liberal basis not permitted by the plan (but still consistent with the applicable rules for hardship withdrawals and on a nondiscriminatory basis). Can you amend your existing hardship withdrawal rules retroatively to match your plan operation without going through VCP, or can you do this through SCP ONLY if your plan didn't allow for any hardship withdrawals? Read literally, it looks like you need to go through VCP, but the logic of that escapes me.

I hypothetically make $400,000 and I complete a deferral election form stating that I want to defer 4.375% of pay with the intent to max out at $17,500 for 2013. 2013 ends and I defer $17,500. The auditor says no, your deferral can only be $11,156.25 (4.375%*255,000).

Who is correct? I understand the match can only be calculated on the max comp limit, but does the salary deferral election only apply to the first $255,000 in comp?

Thank you

I have a new twist on holding out part-timers until they actually complete a year of service.

This employer would like to have a 30 day wait for managers and 1 year wait for everyone else. Everyone involved are NHCEs.

What do you think. Could this be legal?

Are people finding that the brokerage houses of the world are sending out their 408b2 disclosures to the plan sponsors of plans whose participants invest in individual brokerage accounts?

Or perhaps the answer is that they had already been disclosing everything that required disclosures due to existing SEC regulations?