austin3515

I know it's not more than the life expectancy because it is more than the RMD. I didn't get that specific in my quesiton. I did submit to Corbel, but I hope I get more interesting responses! Someone advised me that I too have been part of the no-camp in the past and had some strong arguments in support thereof; but as I explained, objectives often impact analysis. Perhaps it shouldn't be the case but isn't that a tenet of the legal profession? (not that I practice law, I do not, but it seems arguing both sides of the coin is a skill and not a character flaw )

Corbel PT 401k. Participant is 80 and minimum distribution will be $50,000 for 2014. Can this participant take $6,000 per month until the account balance is depleted (i.e., more than the "minimum")? I say yes because the a) refers to the "minimum" required distribution, and b) we did elect that installments are allowed with respect to minimum distributions. So while we do not want installments available for anyone, if Grandpa wants them, we are ok with that. It is not eligible for rollover because it is substantially equal installments over more than 10 years (in this case, it is 20 years).

Since the question is subjective, that seems like a reasonable answer absent anything glaring. If you gave someone a raise based on merit, that is not an unusual adjustment, IMHO.

Also, I think that for top-heavy purposes, even if it was a plan termination/rollover, you still need to include the rollovers in the top-heavy ratio. I almost fell out of my chair when I read that in the EOB two weeks ago.

"I'm not following why the exclusion your client wants wouldn't be considered as an exclusion primarily based on service. Non-shareholder physicians who regularly work at least 40 hours/week would be eligible. Non-shareholder physicians who regularly work less than 40 hours/week would be excluded. The only difference between the two groups is their hours/week. To me, that sounds like employees being excluded based on service. " Yes, I think that was why I asked the question in the first place. I agree, so does TAG, etc. I like the idea of having the part-timer be hourly very very very much...

Does the employer desire to exclude all non-shareholder physicians, or only those of them who work less than 40 hours a week? Just those under 40 Are all of the full-time non-shareholder physicians highly-compensated employees? Are some of the part-time non-shareholder physicians non-highly-compensated employees? There is just one, an NHCE. Although I didn't think it mattered, unless you are suggesting that I just not give them an allocation if they were HCE's--I had thought of that too, but the plan is a 3% SHNEC). Because they are part-time they will be under 115,000 but over 1,000 hours.

Can I exclude Non-Shareholder Physicians who regularly work less than 40 hours per week? It's not an exclusion based on primarily on service so I wasn't sure if this might be an out.

That IS an interesting twist...

It's all in a word... I totally agree with you.

Partner in a Partnership has SE Income of $200K before deducting his $50,000 PS contribution. CPA wants to deduct the 50K in the year funded. Does that mean that for testing purposes I get to use $200K for nondiscrimination testing (only a 25% contribution vs. a 33% contribution)? Or let's say the Plan has a 3% Safe Harbor Contribution only. Will the owner get 3% of $200,000 instead of 3% of ($200,000 - Safe Harbor)? In year, it might well pay to take the deduction in year 2. Is there a requirement that Earned Income be reduced for the current year contributions?

Not rare at all. The only additional expense for splitting is a base fee of $2,000 (and that's being generous to my industry!). So by my calculation the savings is $8,000 not counting the internal burden on the client.

Who loves the fact that you have to scroll way off to the right to see the plan year end now?? Couldn't they make it fit in the window?? Unbelievable...

I don't think the DOL will buy the argument that paying for an audit is a fiduciary breach under any circumstance. Certainly if plan assets are not adequate it would be a breach to use plan assets to pay the fees, but the DOL would say the sponsor has to pay. What I'm saying is, if you're going to do this, have a good reason other than "we're trying to avoid the audit."

The catch-22 of course is that the partner who would deposit the money on January 5th may as well deposit on December 25th thus avoiding the need for the election.

http://www.relius.net/News/TechnicalUpdates.aspx?ID=1010 Just curious if anyone read this article and whether or not they were very concerned about this as it relates to the small partnerships with 2 to 5 partners or so. I get it that PriceWaterhouseCoopers better pay attention to this rule, but it seems like the small guys should be essentially immune from this rule since they are only offending against themselves. One thing I suppose I could be better about is telling people the contributions are due no later than shortly after the date you file tax returns for the year. I suppose that is the verifiable date on which at the latest you knew the distributive share. I dare say I am one of those who casually referenced the "due date of your business tax returns."

Take a look at these Q&A's by Derrin Watson who is the guru on all this stuff. HE literally wrote the book... (Who's the Employer) http://benefitslink.com/modperl/qa.cgi?db=qa_who_is_employer#.UsmJ36Qo4eF especially #323: http://benefitslink.com/modperl/qa.cgi?db=qa_who_is_employer&n=323#.UsmKC6Qo4eE

They never responded, so I just resent my question to them. But I did find this oddly enough from a Q&A in their archives: http://www.law.cornell.edu/cfr/text/26/54.4975-11 (e) Multiple plans— (1) General rule. An ESOP may not be considered together with another plan for purposes of applying section 401(a) (4) and (5) or section 410(b) unless: (i) The ESOP and such other plan exist on November 1, 1977, or (ii) Paragraph (e)(2) of this section is satisfied. (2) Special rule for combined ESOP's. Two or more ESOP's, one or more of which does not exist on November 1, 1977, may be considered together for purposes of applying section 401(a) (4) and (5) or section 410(b) only if the proportion of qualifying employer securities to total plan assets is substantially the same for each ESOP and: (i) The qualifying employer securities held by all ESOP's are all of the same class; or (ii) The ratios of each class held to all such securities held is substantially the same for each plan. (3) Amended coverage, contribution, or benefit structure. For purposes of paragraph (e)(1)(i) of this section, if the coverage, contribution, or benefit structure of a plan that exists on November 1, 1977 is amended after that date, as of the effective date of the amendment, the plan is no longer considered to be a plan that exists on November 1, 1977.

Safe Harbor 401k Plan with 3% SHNEC going to the ESOP. May I permissively aggregate the 3% SHNEC going to the ESOP with a 6% profit sharing going to the owners in the PS Plan? Assuming of course I pass rate group testing. Both Plans are sponsored by the same employer and have the same plan year. [originally posted in ESOP section]

I just looked back in my emails. I requested the cite, but they never got back to me. Sorry. It wasn't even my plan, so I don't know the outcome. It was for a friend of mine who is a CPA plan auditor.

I've always thought of it like this - someone retires in 2013 at age 75 (just to keep it simple), they're first distribution calendar year is 2013. If they roll it out to an IRA in 2013 without taking the RMD first, they will never take their 2013 RMD, because the 12/31/2012 balance in the IRA is zero. Therefore, you must take it before you close. That is of course the logic that was used when writing the regs in the first place.

401k plan permits SDBA for ALL employee, but most people (including all NHCE's) leave their money in the regular mutual fund only platform. The recordkeeper will allow in-kind transfers on the SDBA's but of course not on the regular platform. I am assuming that even though only owners/HCE's have their money in SDBA's that it would not be discriminatory to amend the plan to provide that "in-kind transfers of securities is permitted for the Self Directed Brokerage Accounts.

Here's my philosophy: The REGS prohibit amendments to anything to do with Safe HArbor. So I say, OK, no amendments to definition of Comp, I can't change a pay-period match calc to an annual calc, I can't make eligibility more restrictive. The EOB actually says it would be "ridiculous to preclude an amendment that expands eligibility to another group of employees because that would be contrary to public policy" or something to that affect, and I agree whole heartedly. But in my opinion, to disallow the following is also ridiculous (as some TPA's do): Automatic rollovers, enhancement of vesting schedule, use of forfeitures, addition of early retirement, addition of auto enrollment (similar logic to EOB's take on eligibility expansions), adition of in-service distributions, addition of loans. (incidentally, perhaps removing loans I would have a problem with because it may have influenced a participants decision to defer, a criteria cited by the EOB). I also don't have a problem changing a SH plan to new comp from integrated, because it has nothing to do with Safe Harbor and would not influence a participant's decision to defer. Maybe I will live to regret my cavalier attitude, but to date, the IRS has not explicitly prohibited such amendments. I suppose based on the above idiotic position in the revenue procedure, I would tell a client that they cannot add in-plan roth conversions mid-year (although they left the door open for those that are based on distributable events), but again, they did not prohibit anything else, and because the REGS allow for it, well by golly so do I. They must have something better to do.

Does each plan pass coverage independently treating all other plan participants outside of their own plan as not benefitting? If yes, that's all you need to worry about. With 20 employers you might consider a QSLOB election. Sounds ugly.

OK, I submitted to TAG. When they get back to me, I will let you know the answer.

Safe Harbor 401k Plan with 3% SHNEC going to the ESOP. May I permissively aggregate the 3% SHNEC going to the ESOP with a 6% profit sharing going to the owners in the PS Plan? Assuming of course I pass rate group testing. Both Plans are sponsored by the same employer and have the same plan year.