Bruce1

An individual has 100% ownership of two separate companies company A and company B. With having a brother-sister control group. My question(s) are: 1. Is it safe to assume this individual can sponsor two individual SIMPLE IRA plans, one for each company and be considered compliant with control group rules? 2. Would it not be acceptable to sponsor a SIMPLE IRA at one and a SEP IRA in the other? 3. Would it not be acceptable to sponsor a SIMPLE IRA at one and a 401(k) PS in the other? Thank you.

the 5305 is to be used with sponsors that only want to use one institution and 5304 would be used if you want to use multiple institutions. You probably already know that. But most institutions have their own internal forms that serve as the 5305, and I guess technically since the sponsor has "said" I'm only using one institution, it could likely mean that you beholden to one institution per year..? That's the only way I can make sense of the institution not letting a client leave is because they have to use their institution for the full year.

Thanks for the insight Paul. I assume these new deductions would not have any affect on plan compensation?

Any more guidance on this issue? Our team is transitioning a simple IRA to SH and the doctor would like to make profit-sharing contributions. Is the 415(c) limit prorated as well?

It would certainly make sense to make Roth contributions. If you're wanting to see if it makes sense, you'd want to look at your tax brackets in retirement.

For history's sake. Did Roth distributions previously satisfy your annual RMD amount?

How does it work with you continuing service? There still has to be a 5500 filing and no ones going to work for free. How do you get paid as a TPA if a company is going bankrupt? Sounds like a stupid question but just curious what other practitioners have done in these cases.

Working with a start-up 401(k) with the new auto-enrollment feature. Client asked if an email or a text message is an acceptable form of an opt-out. Would this type of election hold up in a DOL audit?

This question should be posed to an attorney. In a normal situation the wife would be able to inherited the IRA and assume it as her own. I haven't had a client name a trust as a beneficiary so it certainly complicates things.

Have any payroll software's created anything to help sponsors out with this new rule?

I'm not sure using the oldest son's date of birth would be correct because a portion of the fathers money would be son A and the other portion of the money would be son B. Each son would have their own lifetime factor. It's a minimum distribution so there's no penalty for overcalculating or taking more.

Yes she would be able to transfer into her name and defer the tax implications of RMDs.

Which IRA custodian does everyone use for force out IRA's?

I'm not sure why the IRA custodian is wanting to return the money. I'm sure they can do a deposit correction and have the money journaled to the correct account. It seems like there would be an issue rolling money back into the plan because she is no longer a participant.

Just briefly reading over your post, why don't you have the employer fund the contribution after the plan year? Just do one big contribution?

I thought so...

Would it be an acceptable practice for the employer to go to employees and have them sign a deferral election form retroactively stating whether they wanted to make deferrals off of bonuses? The employer could then make corrective contributions to employees who genuinely wanted deferrals coming out of their bonus pay?

I have an employer from a small company who didn't withhold any 401k deferral and match for a large bonus paid to employees. Employees missed out on a few thousand dollars in match, as well as deferral. Question: 1. Can an employer go off a verbal consent to not withhold money from this pay? (Their deferral forms don't have an election for bonuses, thus all pay would include an ee's deferral election) Solution: 1. A 50% QNEC for missed deferral (plus earnings), and a 100% QMAC based on missed deferral (plus earnings)?

Do you even have to file the first year?

Don't additional contributions get swept based on previous withdrawal instructions?

@Jakyasar A few points to go over: 1. If a non-spouse inherited an IRA they generally start an inherited IRA (for tax deferral purposes). They will "generally" have to take RMDs from the inherited IRA depending on circumstances. 2. If the individual who inherits the IRA, decides to cash the IRA into their bank or another non-IRA account it's no longer an IRA and it's considered after-tax money. 3. From what I briefly read online you cannot do a Roth conversion from an inherited IRA to a Roth IRA. I think the reason is that the non-spouses bene cannot assume the inherited IRA as their own. If you were able to convert the money into Roth, then the tax deferral could essentially go on forever.

The top-heavy minimum contribution will look at the highest key employee allocation rate that takes into account all contributions of that individual. Whether it is considered employee or employer doesn't matter because the min takes into account everything.

Have you considered a top-paid group? Or are most of the HCE greater than 5% owners?

The regulations are written in a way to protect the benefits of NHCE compared to the benefits of an HCE/Key. But do the regulations have parameters around the amount of benefits provided between the HCE group, or the NHCE employees? For a new comp allocation could an employer at its discretion for example provide a larger benefit to a single NHCE, or even no benefits to a certain HCE? While still passing gateway etc. I'm curious is there any regulatory language that prohibits an employer from discriminating within HCEs or NHCE?

https://stwserve.com/new-irs-regulations-on-year-of-death-rmds/ The IRS just released final regulations on this issue. Above is the article that addresses it. One individual could take the full required RMD for the original IRA owner. There are some issues, what if the individual who was supposed to take the full required RMD doesn't take their RMD? What if the children don't talk to each other? In my opinion, it would be safe for each IRA beneficiary to take their share or portion of the RMD. There's no penalty for taking amounts above and beyond the RMD for a beneficiary.