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Fibonacci

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  1. I am surprised I have never had this issue. I have a client who deposited funds the profit sharing allocations of the participants into their safe harbor accounts and safe harbor allocations into profit sharing accounts. The funds are held at John Hancock. Is there a way to correct this? I just want to transfer the difference between the accounts. Should there be an effort to estimate the earnings and move those funds as well? I do not recall reading about corrective measures in this situation.
  2. One last thought. If he is the only active participant on 12/31/24, he rolls the last of his assets out just before 12/31/24 and all other participants have a zero balance as of last day of the plan year (112/31/24) can anyone think of a reason not to have a 12/31/24 termination date? I am not anticipating this as they have former employees with sizeable sums of money who have chosen not to (or have at least been too lackadaisical) to distribute.
  3. HCEs are not eligible for the safe harbor contribution. That is where I am stuck on this. The owner is past normal retirement age and wants to roll everything out to an IRA after he has done his deferrals. He has also expressed concern that he may hire some back this year so there is the real rub.
  4. I have a client who is a partnership of corporations. One of the owners of one of the corporations participates in the plan, the owners do not. The partnership lost a contract and as such all of his employees with the exception of the owners of the corporations are being terminated (it is a condition of their employment when the contract is lost they are terminated). If it matters most of the participants are HCEs but only 1 is an owner. They wants to terminate the plan but rely on a 3% SHNEC for to pass 401(k) testing. All of the employees have been notified and they will be let go on a certain date (say June 30.. I am not sure when but it will be well before the end of the year) with the exception of the owners who are employed by their respective corporations. The partnership will continue for some time (well past the end of the year if not several years) as they are still being paid for work they have already done. Can they terminate the plan before the end of the year but after all of the employees have been terminated with the exception of the owners and still rely on the 3% SHNEC?
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