austin3515

Trying to figure out how to handle a situation where a temp employee is hired full time by the recipient. You are required to recognized service while working for a "leasing organization" if you become hired by the recipient if the SOLE reason you are not a leased employee is because you have not been working on a substantially full-time basis for at least a year. However, one of the requirements for being considered a leased employee is that: (A) such services are provided pursuant to an agreement between the recipient and any other person (in this subsection referred to as the “leasing organization”), Most temp services do not require a written agreement. They simply send out temps, and bill their clients. So are these services provided pursuant to an agreement? I would argue no, because if there was no requirement for a formal written agreement than there would be no need for this (A). There is an "agreement" whenever any two unrelated parties exchange goods or services for money, even when I go to the drug-store to buy a pack of gum. You agree to give me a pack of gum, if I agree to give you a dollar. In the absence of a written agreement, the relationship of a temp agency to its clients is analagous to the drug-store's relationship to me, the patron. Therefore, no agreement, no recognition of service as a temp once hired on a full-time basis because now the lack of full-time employment for at least a year is not the SOLE reason. Thoughts?

Thanks! I can get it for just $40!

What is SR? Salary Reduction?

Anyone have a good sample notice about terminating a safe harbor match mid-year? i.e., it needs to explain consequences of the change, information on how to change deferral elections, etc.

Didn't work for me...

ME TOO!!! That's exactly what happens to me!! Jeeze...

If anyone is interested, it is related to the encryption that they are using. Still working on getting mine to work, but they have been very responsive.

I wonder how far down the road they were when someone said "Wholly #$*<!!!" I have to say though, if I could just get the text in English it would be a lot easier to navigate!!

Point well taken

Match to which the participant was never entitled to do should have been forfeited.

Are they obtainable?

We just got our 2008 EOB, CD version, but all of the text is giberrish. Anyone else run into this? Were you able to fix it?

Includible Comp is basically defined as wages "includible in gross income." Can someone tell me if there is a good resource out there for what this means? Without some sort of a good resource, you would need a CPA to get some work done!! I was disappointed in the level of detail in the EOB on this topic. Although my primary request is to find a good resource, in particular I am looking into ST sick-pay paid by a third-party, but included on the participant's W-2.

I think we will eventually have a de minimis level of taxes. I have heard that $10 tax payments are a thorn in their side - It costs them about a $100 to process each form so its a big loser for them. Not to mention, the TPA needs to charge about $100 to process it on their end (letters, sign here stickers, etc.). This should in no way be confused with the actual correction of the late deposit.

Thank you for asking this quesiton. It just so happens that I am running an ADP test tomorrow with this very thing. 1.401(k)-2 (6)(iv)(D) (D) Special rule for prevailing wage contributions. Notwithstanding paragraph (a)(6)(iv)(A) of this section, qualified nonelective contributions that are made in connection with an employer's obligation to pay prevailing wages under the Davis-Bacon Act (46 Stat. 1494), Public Law 71–798, Service Contract Act of 1965 (79 Stat. 1965), Public Law 89–286, or similar legislation can be taken into account for a plan year for an NHCE to the extent such contributions do not exceed 10 percent of that NHCE's compensation.

1) Yes. You can always use a 414(s) safe harbor definition of comp. You can use one 414(s) for a match, a second for profit sharing allocations, a third for ADP testing, a fourth a(4) testing, you get the idea... 2) The definition of comp for determing HCE's and keys is prescribed by statute, so every qualified plan uses the same one. Its 415(something or other). 3) See my answer to 2).

Earl - That's one of the best stories I've ever heard! Thanks for that gem...

For what its worth, I come to the exact same conclusion as Belgarath.

I tried to take it, but the security on these boards is mighty tight... I did however keep a copy (it was awesome, so thank you).

Anyone have a good board resolution I can borrow/steal to remove a trustee?

Relius won't give it but she should get it. "actively employed on the last day" says what it says. If the person was in their working on 12/31 they were active. The EOB agrees (last time I checked anyway). In fact, I've heard people go so far as to suggest that if 12/29 happens to be a Friday, if someone worked on 12/29 they should get the contribution. This might be a little too generous... Curious to know if others have seen this...

But in your third paragraph, the HCE deferred the full $20,000. How do you not see that this is a HUGE advantage over a calendar year plan--that is IMPOSSIBLE in a calendar year plan.

Sure. That would be pretty rude if it could only increase your refund!

My head is spinning at about 1,000 rpm's. Generally, I learn from these boards, but I know less today than I did yesterday. Does anyone have a link to clear explanation of how this works, like a Corbel/TagData/McCay Hochman article?

I don't have time now for in depth analysis of the regs, but I will be looking into this more for my 3/31/08 plan year client... The only thing I will say is that if you are right, I'm going to find any plan I can that has an age 50 owner and ADP troubles and amend them to a fiscal year plan ASAP. Because through all of this legalese if you're telling me that the owner can still defer $20,000 every year, even though the ADP test is failed (assuming refunds are < CU Limit), then that is a safe harbor plan without the high contributions (ok, and w/o the TH exemption, but you get the idea).