Last year, my company burned through their 100+ employee grace period with the SIMPLE IRA. This year, around January 10th, (5 days before our first paycheck of the year), we were informed that the company could no longer offer the SIMPLE program. This sounds a lot like the employer is breaking several rules.

1. Operating a SIMPLE IRA with over 100+ employees (as of January 9th, of this year, employees knew nothing of the situation)

2. Terminating the SIMPLE plan without giving employees 60 days notice

3. Terminating the SIMPLE plan mid year

My employer claims to be searching for a 401k program, and hopes to have one available within the next few months. Several employees are considering leaving this employer and would like to know if anyone has thoughts / ideas as to what may be done to handle this situation from the employee's perspective.

Employer has a 401k and a 403b plan, deferrals and match only. May and/or must the plans be combined for 410b testing. Also, not sure what to ask about ADP and ACP testing since no ADP testing for 403b plans. Any help would be greatly appreciated. Thanks.

Plan sponsor is using the default under 409A for determining specified employees. With respect to participants hired midyear, for purposes of calculating compensation for a specified employee, does the plan sponsor consider the actual amount paid (i.e. W-2 income) or does the plan sponsor take the compensation at year end and convert this to an annualized number?

Owner of Company A purchased 100% of Company B creating a controlled group. Both companies have their own separate 401(k) plans. Can Company A do ADP testing for its 401(k) plan separately from Company B's 401(k) plan?

I seem to recall some guidance or a regulation that permits separate ADP testing, but cannot locate it.

Thanks.

Client has SARSEP and allows employees to defer up to 25% of compensation and client makes annual employer contributions = 4% of compensation.

Client has been determining all contributions based on gross wages.

Client uses model IRS Form 5305A-SEP which to me seems to say the term "compensation" is w-2 wages excluding employer contributions and elective deferrals.

Which means that for purposes of calculating employer contributions means that the 4% should be applied to the employee's wages less elective deferrals.

Anyone have any thoughts?

Client's Profit-Sharing Plan was last updated for GUST using a proto-type document.

I have prepared all amendments required to have been made since then including an EGTRRA restatement.

I think I need to use Appendix C, Part II, Schedule 2.

My problem is I can't figure out which box to check.

Do I check the box for Cumulative List for Cycle E individually designed plan (EIN ends in 5)? This seems wrong because the last time the plan was restated it was done so with a prototype document.

Or do I check "Other" and list each individual amendments along with EGTRRA restatement?

Any assistance is appreciated.

Brand new SH 401(k), effective date 1/1/14. The person who enrolled the employees did not check eligibility. Deferrals have been withheld for 8 ineligibles, no HCE's. All were hired in 2013 and have not met the 1 year wait. Will follow the EPCRS procedure for amendment. I was originally thinking I would word it so that anyone employed on 1/1/14 is eligible, but since it states that it should change the entry date only for the specific employees, do I include their names in the amendment?

Have not yet submitted document for LOD. Is this amendment going to cause a problem?

Have a client who signed a Auto Rollover Agreement for balances between $1k and $5k. For "lost" participants, we normally send them to "search" to locate a good address for them. In the past, we have charged the $25.00 fee to the participants account and if moved to an IRA, a fee of $30.00 to set the account up. Are these participant fees allowable to charged against the participant account?

Thanks.

We timely filed a determination letter application but forgot to attach the user fee. What is IRS policy? Will it be treated as not timely filed? Or will they contact us with an opportunity to send the user fee?

Safe harbor plan is satisfying the ADP safe harbor by making the 3% non-elective contribution. The plan also has a discretionary match formula of 0-7% deferred=0% match; 7-8% deferred= 100% of 1% match (participant will receive 1% of compensation as match if they defer more than 7%).

The ACP test will be performed since this formula exceeds the 6% limit but my question/concern is related to the rate of match increasing as the rate of deferrals increase. Since the ACP test is going to be done, is this tiered match acceptable if we can satisfy the BRF test?

Any guidance would be greatly appreciated.

QNPG

Help! My brokerage firm didn't process my request for a distribution from my IRA last year (its not a minimum required distribution). The firm processed it this year despite my instructions. Is there any way to appeal to the IRS since it's not my fault?

Co. A sponsors a safe harbor 401(k) plan using the match to meet safe harbor

Co. B sponsors a safe harbor 401(k) plan using the 3% to meet safe harbor

Co. A purchases Co. B in mid-2013 in a stock purchase. Each company has continued to maintain separate plans. Thye want to merge those plans now & Co. A plan provisions.

Had they done this in 2013 I think we would have been okay under Treas. Reg. §§1.401(k)-3(e)(4). Are we still okay to merge the plans in 2014? We are still in the transition period, so I'm inclined to think it is okay because the plan merger is still due to the business transaction, they just didn't address the plans as quickly as they could have.

Thanks in advance for any guidance.

I've been confusing myself here, and now I'm questioning what I think I know.

Two corporations - A & B. They are a controlled group. Each maintains separate plans. Let's assume deferrals and match only - no employer PS contribution.

1. IF there is no HC eligible for both plans, then the plans can remain separate, and be tested separately for all purposes - coverage, ADP, etc., etc. - Agree/Disagree?

2. IF there is at least 1 HC eligible for both plans, then they can still test separately for coverage. Assuming they pass coverage testing separately, they can also perform separate ADP/ACP testing, BUT, they must take into account the deferrals and match by the HCE's on BOTH plans (due to mandatory aggregation) when performing each separate ADP/ACP test in Plan A and Plan B. Agree/Disagree?

3. Now let's assume in 2 above that the plans cannot pass coverage separately - once aggregated for coverage, they must also be aggregated for ADP/ACP testing. Agree/Disagree?

Other thoughts? I need a vacation...

Would a plan of a CFP (Certified Financial Planner) be covered by the PBGC?

Seems to fit the list in ERISA § 4021(c )(2)(B) but not explicitly.

Any opinions or experiences?

Thank you

Can the owner who just turned 70 1/2 and is awaiting IRS DL use the account balance method to to take RMD?

RBD is 4/15/2015 but I think plan termination and desire to roll to IRA shortly after DL (expected in early 2014) trumps delaying the RBD to 2015.

That is if he's electing a lump sum can he take PVAB of benefit on 12/31/13 divided by applicable divisor to determine 2014 RMD?

edit - never mind for future reference the answer is in T.R. §1.401(a)(9)-(6); Q&A 1 - (d)(1) and (d)(2)

Can we have a negative election applicable to one group of employees, but not applicable to all groups of employees? For example, the plan will say, "if you are a salaried employee, you must elect to defer compensation or no compensation will be deferred. If you are an hourly paid employee, we will automatically defer 3% of your salary unless you elect otherwise."

Are there any issued with this?

I am working on a defined benefit plan with a doctor and three staff people. The doctor's accountant wants to know how much of the 2013 contribution is attributable to the doctor's benefit. My first thought is to allocate to each participant a percent of the contribution equal to the percent that his/her TNC is of the total TNC. However, there is a funding surplus that wipes out the TNC, so the minimum is $0. Would this allocation method still be appropriate? Is there an alternate allocation method?

Any help would be appreciated!

A few years ago, some small-business employers - in an effort to make health coverage less expensive - used a design of increased deductibles and other cost-sharing provisions of a group health insurance contract, coupled with a self-funded health-reimbursement plan that covered the difference in the deductibles and cost-sharing. Those who advocated this design asserted that the employer's expense under the health-reimbursement plan would be less than the incremental premium attributable to having foregone the lower deductibles and cost-sharing.

After the Affordable Care Act and other law changes, is such a design still permitted?

If not, which statute or rule precludes it?

Does the analysis vary with the size of the employer (for example, more or less than 50 employees)?

If such a design can continue, is a plan-document revision needed to sustain the design's compliance with relevant law?

Does one need to be employed to set up a health savings account? I have taxable income every year and purchase my own health insurance with additional medical expenses. If I can set an account up, who would I see to do so? Thank you!