austin3515

But we're increasiong it because of an attained age, so do you agree that this would be OK? (bizaar, but OK?)

FWIW it wouldn't be age discrminiation since the people who are being limited are the younger people. Perhaps you could limit deferrals to $1 for all HCE's, thus alllowing those over 50 to do the catch-ups. The merits of this have been discussed ad nauseum in other posts, in particular how it relates to top-heavy minimums...

"A pooled trustee-directed trust is not the same as a trustee-directed trust where some or all of the participants have individual accounts. There appears to be support for this approach in the statutory construction of Section 105(a)(1)(A)(iii) of ERISA, as discussed at this earlier BenefitsLink thread:" But if the money was in a John Hancock/Great West style platform sending out quarterly statements wouldn't they already be providing the required information?

So if I may summarize, in all cases, SE employees pay more in FICA taxes, correct? I say "all cases" becaise there is no cap on the medicare tax. Even in the "two jobs" example, the owner would get a refund of the overpayment of SS Taxes.

I'm intrigued... Can you please provide an example? I'm not sure I'm following how they're better off.

we're talking just about the match here though?

http://hr.cch.com/news/pension/042312a.asp Take a look at this, from today's BL newsletter. This has always bothered me because it puts SE individuals at a disadvantage from corporations. IF a corporation does a PS contribution for the owner, the PS contribution is not subject to SE Tax. But because the SE's contributions are deducted on page 1 of 1040, they are still included in SE Income. Am I missing something or do others agree that SE Individuals are paying more in payroll taxes (assuming two otherwise identical businesses)?

I agree that it's not silly. As a participant, there is certainly value in knowing at a minimum the breakdown between stocks and bonds, especially if you have, say $100,000 in the plan? I think this gets to ESOP Guys comments about reporting the total by category. Frankly it wouldn't bother me as much if this was the requirement because it is steeped in application and logic.

I agree, I like that answer a lot... By contrast, would it be unreasonable not to prorate his comp?

(b) MODEL STATEMENTS.— (1) IN GENERAL.—The Secretary of Labor shall, within 1 year after the date of the enactment of this section, develop 1 or more model benefit statements that are written in a manner calculated to be understood by the average plan participant and that may be used by plan administrators in complying with the requirements of section 105 of the Employee Retirement Income Security Act of 1974. What about this though (which Bird mentioned)? We were promised assistance with this and the DOL has not been forthcoming. Are these disclosures being made by the public at large? (FYI, we've been doing this, begrudgingly... I knew we were not the only ones, but I have this nagging suspicion that we're in the minority).

Plan Sponsor adopts a brand new safe harbor plan with an effective date of 1/1/2011. This is a safe harbor match, which is determined/calculated on a per payroll basis. The Plan Sponsor did not actually Adopt the Plan until April 2011 and 401(k) and match did not actually start coming out of employees' paychecks until May 2011. The owner is self employed and will have schedule C of well over $245,000. Being that the payroll for 401k and match did not actually start until May, is there any reason I should have to pro rate the compensation limit even though the effective date is 1/1/2011. Meaning (245,000 / 12) * 8) = 163,333.33. My concern is that the nature of the owner's compensation is such that it unfarily benefits the owner, by allowing him to take into account the entire year of pay, while his employees did not have the same benefit. My concerns would be alleviated if the Plan provided for an annual match, because then everyone would have the advantage of 12 months of pay.

http://benefitslink.com/boards/lofiversion...php/t47953.html Funny, a lot of the same people responded. Bird, because the DOL was supposed to issue some guidance on this and never did, do you still feel the same way you did? Just curious... These pooled plans have a tendency to invest in individual securities which makes the statement requirement a bit onerous - and ridiculous.

I had thought many people concluded that until the DOL came out with some guidance on this ridiculous requirement that we had some lee-way? Come to think of it, I just went through a DOL audit for a pooled plan and this did not even come up...

Tom, are you suggesting this plan has some hope? Or do you agree that the plan has some serious problems. Why do you mention the non-elective aggregation? It doesn't sound like there are nay nonelective contributions?

I find that big well known names are the most likely to have these sorts of problems, especially on smaller plans. In fact, I already know what the TPA's response is going to be. They received a questionnaire in which they asked "Are there any other employers sponsoring plans that are considered part of the same controlled group?" and the client of course said "no." Let me knw if that is indeed the response!

As long as both plans pass coverage you have no problem. If Company B plan excludes the owners, then plan B passes by default because only NHCE's benefit (assuming they were excluded from that plan). Then we get to Company A. Since 100% of all HCE's benefit in the Plan, and just 10% of all NHCE's benefit, even Average Benefits won't help you. So yes, the prior TPA has some explaining to do... I see a VCP submission in your future and some big giant checks in your clients future

So you know how plan dopcuments have the area where the TPA can sign, authorizing uyse of the prototype? What does it mean if everyone but the TPA signed where they were supposed to. This was an occurence of the adoption agreement being emailed. Is it a problem? It says write in the language that we have that "Such acknowledgment is for administerial purposes only". Certainly it's not a compliance issue, correct?

Is there any reason that a sole proprietor can't use an evergreen deferral election? In other words indicate "I elect to make 401(k) contributions equal to the max allowed (including catch-ups) every single year until I change my election." I've just never did it that way because it generally comes up on a one-off basis. But now I'm in a position to use more of an evergreen election.

just got a projection the likes of which I have never seen. There are two allocaiton classes for the employees - those earning more than $65,000 and those earning less than $65,000. I know we're not bound by reasonable classification for anything, but it just seems so "obnoxious?" (probably synonomous with very very clever!) that I just had to ask...

just to make sure no one thinks I am suggesting that D's should not be reported. Nothing could be further from the truth. My situaiton again is that a filing was inadvertently missed and the question is "Was a filing REQUIRED in the first place." That is it. Yes, you're crazy if you don't report D's for all the reasons mentioned above.

Now we're talking

FROM THE REGS AS OF TODAY (§301.6057-1©(2)(ii)): c) Voluntary filing —(1) In general. The plan administrator of an employee retirement benefit plan described in paragraph (a)(3) of this section, or any other employee retirement benefit plan (including a governmental or church plan), may at its option, file on schedule SSA information relating to the deferred vested retirement benefit of any plan participant who separates at any time from service covered by the plan, including plan participants who separate from service in plan years beginning before 1976. (2) Deleting previously filed information. If, after information relating to the deferred vested retirement benefit of a plan participant is filed on schedule SSA, the plan participant— (i) Is paid some or all of the deferred vested retirement benefit under the plan, or (ii) Forfeits all of the deferred vested retirement benefit under the plan, the plan administrator may, at its option, file on schedule SSA (or such other form as may be provided for this purpose) the name and social security number of the participant with the notation that information previously filed relating to the participant's deferred vested retirement benefit should be deleted. I think this is why the SSA Instructiond do not say you are required to report them. I'm sorry but the section of the instructions I've noted above simply do not require it. Tom, I see you're point, but inference is not a requirement. And a plain english reading of the instrucitons appears consistent with the regulations.

I always report them too. This happens to be a plan that left us, we coded the plan as inactive, and we inadvertently missed a filing date for the ssa (it happens to be a fiscal year-end plan). It just so happens that ALL of the entries were D's. So we're trying to figure out if we have a problem or not. Tom, are you suggesting bullet point 3 overrides the section entitled "When to report a separate participant" and "When not report a separated participant"? Both of those sections in my opinion suggest that I would not be REQUIRED to report them. http://www.irs.gov/pub/irs-pdf/i8955ssa.pdf

Is it mandatory to report D's, or is still optional? The instructions do not seem to go out of there way to tell you not to report them. Any help is appreciated...

Great idea, but that's not generally how platforms work. Also, participants will continue to see the money in their statements under your scenario. It just stinks all the way around.