austin3515

What did they want instead? Best performing fund? Does anyone else feel this discriminates agaisnt the small employer, for whom the cost of filing under VFCP is most significant (relatively speaking).

The DOL is saying publicly now that you can only use the DOL calculator if you file under VFCP. However, we've had clients ajudited by the DOL, where the auditor goes so far as to fill out the interest calculator for us as an example of how to correct?? I'm curious what other people are finding. Is it just a few higher ups pontificating, or are the field investigators applying this stupid standard as well?

I thought about quoting those regs, but you don't HAVE to use a 414(s) definition to calculate deferrals - you need to use 414(s) for testing purposes...

As long as 83% of the HCE's comp is being excluded as well, that wouldn't necessarily be an issue. That beig said, this CLEARLY discriminates against the NHCE's, as PIP mentioned. I wouldn't even consider this plan design without IRS approval. Personally, I wouldn't waste my money on the application.

You're doing okay on your own, but I would hire a TPA to do all this for you. There's thousands of things to know, and only someone who does it day in and day out can have a shot at even knowing most of them. It will be worth the extra cost if you get audited by the IRS. Also, the fact that you didn't mention top-heavy in your original post means that you missed the single most important issue your Plan faces (in terms of how sorry you'll be if you get it wrong!). Small plans are almost guaranteed to become top-heavy at some point.

If the Plan allows in-service distributions, I can't see why not. The qualification of the Plan is not as much of an issue with an after-tax distribution. If the Plan does not allow in-service, then amend the plan accordingly (assuming the 401(k) restraints won't put the whammy on things). I think there are probably a lot of issues to consider here though. For example, I'm not certain there is such a thing as a "late safe harbor contribuion." No doubt the Plan gets the money, but I'm not sure the Plan can skirt the ADP test in this scenario. Of course if the owner needs to get cash out anyway, I suppose failing the ADP test is of no consequence (except amending his 1040 from 05, if he's already filed).

I did get them. Thanks to WSP's notes, I was able to sit with the woman who does the 5500's in our office and get just what I was looking for. THANKS!!!

It is Relius, but I don't have access to the program. If someone does, and they can attach it to these boards, that would be AWESOME!!

I just can't believe that it's impossible to get blank copies of these forms (although I've never been able to find one on the internet). I assume the barcoding would just indicate all blanks, or have no bar code at all. Whatever it is, there must be a way to get this document in pdf!!

I'm looking for a pdf file that DOESN'T look like the one that you hand write on - I'm looking for a pdf version of the actual form that would print off any 5500 reporting system. The situation is that one person keys in all 5500's in our office. We're constantly asking for another page of Schedule D, or a blank schedule A, or whatever. I want to just be able to print it off a central pdf document that would be saved on the network. Anyone have something like this?

Does anyone have a pdf file that has a blank 5500? Not the hand written form, but the one that prints out nice for filing? I can't find a blank one anywhere!!

Could be... Better make sure though!!

No, but I don't think the DOL was as "maniacal" about it back then as they are today. I don't think there's any need to go back 10 years though (okay, technically there is, but in reality nobody ever would). I'd go back as far as they can audit, which should be 3 prior 5500's.

One important thing is that if you terminate the old plan, you wouldn't be able to start a new 401(k) plan for at least a year (assuming the old plan was a 401(k)).

There's no attribution of ownership between siblings, erego (sp?) no one is treated as owning any more than direct interest. There's obviously no parent-sub relationship here, so that leave brother-sister: Because there is only one common owner, the identical interest test comes out to 9% (i.e., the sole common owner's lowest interest in either of the two businesses), and it must be at least 50% for a controlled group to exist. So no controlled group. That is of course absent any highly unusual affilliated service group relationships. Assuming the business have no relationship at all (other than the fact that siblings own them), there's nothing to worry about there.

RJF - do you realize that the dollar limit for the lookback year your referencing is the 2004 thresshold? I'm not sure when it increased to $95,000. Because the look-back year ends 3/31/05, it began in 2004, and the limits apply plan years beginning in the applicable calendar year.

That was refreshing. Anyone who followed a similar topic last week knows exactly what I'm talking about...

Austin3515, I am not saying that you are stupid. You simply remind me of myself when I was inexperienced and stupid. There is nothing in what I wroted that came close to implying Sal Tripodi is wrong. We are merely discussing the meaning of a sentence. Let's leave the rhetoric aside from now a discuss the real issue. Some of us understand when the gateway rules apply and some of us don't. The fact this I understand the rules and you don't does not mean that I am thinking highly of myself; but instead means that I do not think highly of you. I am trying to teach you something that you have no interest in learning. All you want to do is attack with your weak interpretations of someone else's literature. You should grow beyond that. But, IF, IF, IF (let me emphasize again, IF) I mistakenly assumed you called me stupid in a prior post, surely you don't expect to me believe your last post doesn't? No response needed, nor desired...

ERISA Nut. You're not very nice. I also think you think a little too highly of yourself. I'm not stupid. Anyone who says Sal Tripodi is wrong, and that one shouldn't look to the regulaitons for answers is indeed a NUT. I think you should read the EOB paragraph that Preston attached and specifically indicate where in that concise clear as day paragraph Sal is mistaken.

Preston wins. Case closed. Can't argue with Sal. Could he have made it any more clear?

But the initial post already stipulated that he couldn't pass avg ben treating TH's as zero... So doesn't that then bring you into non-safe harbor status?

I think perhaps it applies because of the fact that we had to include the top heavy minimums to satisfy the average benefits test. Therefore, the safe harbor status is blown, and now 401(a)(4) testing is required. And if the rate group test fails the ratio %age test using allocation rates, then it must be X-Tested. And if any of the rate groups fail the ratio %age test (and pass NDC), then the average benefits test must be passed, most likely using X-Testing. This is how the gateway comes into play. For what it's worth, I just had a very expensive ERISA Attorney design a plan based on cross-testing the average benefits, with no need for the gateway. Part II - A Question of my Own LEt's say you can pass the rate group testing using allocation rates, EXCEPT that you don't pass the ratio percentage test based on allocation rates (but you do pass the NDC). So now you run the average benefits test, but need to use X-Testing. Does that require the gateway? I wonder... Very unlikely scenario, I know, but I think the answer would help clarify things...

Have a qualified profit sharing plan with life insurance. Plan is terminating and we want to provide participants with some information regarding the impact of a) taking a cash distribution equal to the cash surrender value; and b) taking a distribution of the actual life insurance policy, and continuing the premium payments outside the plan. Anyone have any good write-ups? We have the EOB's excellent section on the topic, but want something in plain english that can be distributed to participants. Anything you can share is appreciated!

Do you have access to the ERISA Outline Book? Sometimes the regulations are written in giberrish, so while it may seem like their saying one thing, they're really saying something unrelated. I think that's what's happening here. The EOB explains everything quite well, and I'm sure you'll find a section that talks about the fact that a safe harbor plan may exclude any class of employees it wants to, provided coverage is passed.

I'd say you're SOL. From the gist of your post, it was the profit sharing allocation method that survived, and as such that's the method you're stuck with (of course, as has already been mentioned, the document has the answer). Assuming you have a last day rule, you could change for 2006.