austin3515

in lieu of all OR A PORTION of the pre-tax elective contributions the employee is otherwise eligible to make under the plan. Where's the ambiguity? That's super aggressive to interpret that to mean all or none, IMHO...

Make a contribution to the NHCE's equal to the refund ("one-to-one QNEC"). Should be a QNEC. See EPCRS as outlined in Rev Proc. 2003-44, unless there is a newer one (but I don' t think there is?).

When calculating earned income, it is necessary to allocate forfeitures between the employees and the owners. How is this done? Pro-rata based on the contributions allocated to employees? Profit Sharing only, or would you include all employer contributions (i.e., including safe harbor)? Is there any published guidance on this?

That was awesome.

But of course if the only money is SH match, rollover and 401(k), there shouldn't be any forfeitures!!

Kirk, I agree with Locust - that was one Plan, and the audit requirement for a single Plan is always there if there are more than 100 participants. If there is a requirement to aggregate participant counts under multiple plans, I have never seen it in the instructions to the 5500 (but for the commingled asset pools); I would find it odd that such a requirement exists and is not covered in the instructions. What are your thoughts? You are distinguished poster on these boards, so I'd love to hear your response!!

We're a typical TPA firm, no daily trading. We do almost all of our work on a plan year-end. I'd REALLY love to know the actual price - anyone know?

Thanks Bos - I try to explain the inefficiencies created, to no avail. Any other users out there?

Does anyone know how much a Relius Administration license costs per user (defined contribution)? Also, I'm wondering if other firms experience limitations on access to Relius, as employees. For example, we have a schedule, where we can only be on the system (without "squatting") at 3 intervals of 80 minutes. I'm trying to talk my boss into more licenses, so I'm curious to see if we're behind others or equivalent to others (I hope we're not ahead!).

A sponsor (Company ABC) has two plans ("Company ABC ESOP" and "Company ABC Profit Sharing"), both with 1099-R's and federal withholding. All reporting is done on Company ABC's EIN--the Plan's have no EIN of their own. Should one set of 1099's with the Company ABC's name AND EIN be issued? (as opposed to using the Plan names on two separate batches) Should one 945 with Company ABC's name and EIN be filed (as opposed to the respective Plan name)? In other words, does the Plan name show up anywhere on the 1099's or 945?

Are you saying rFriday is a pay day? If not, I'm not sure you do have compensation (i.e., if defintiion of comp is W-2 wages?

Does anyone have any compensation in the Plan Year?

Let me know what you hear!!!

cross-testing may or may not work, but that's not the point. The point is this is a standardized plan, and I get the feeling that eveyrone seems to think it's at least possible to fail 401(a)(4). Example: 1 HCE, getting 3% SHNEC and Integrated PS 3 NHCE's, 2 of whom benefit in both the SHNEC and the PS, one of whom gets ONLY the 3% SHNEC, because they were terminated with 300 hours of service. Forget cross-testing, assume the HCE is 21 and the NHCE's are in their 50's. Does this plan fail 401(a)(4)? Am I missing any pertinent data?

I think we should assume non-involvement in the each other's businesses, and that this is a non-community property state, just for the sake of sticking to original question. Those are both valid points though!!

The second plan only passes coverage if the person in the first plan is excludable. So the heart of my question really becomes, is the guy from Plan 1 excludable for coverage under the second plan? So Tom, it sounds like you're leaning to the fact that my standardized plan fails coverage?

Standardized profit sharing plan adoption agreement, everyone gets 3% of pay for safe harbor. Plan applies the "last day rule if <500 hours" allocation condition. There are just 3 NHCE's. One participant who gets the 3% of pay is terminated with 300 hours, so is not benefitting under profit sharing. Because they are benefitting (i.e., getting the 3%), they are not excludable under coverage (and the plan passes coverage). So for this Plan, the rate group testing is failed (i.e., safe harbor allocation model is blown because of different allocation conditions on the SHNEC and the PS). Okay, so we restructure the Plans. The person described in my second paragraph goes into their own plan. They're an NHCE, so that plan passes b/c it has no HCE's. My question is really on the second plan - can we treat the participant in the first plan as excludable? The condition for excluding a term with a break is that the sole reason they're not benefitting under the Plan is the fact that they were not employed on the last day. That condition does not seem to be met here, which means that he is not excludable, which means that the plan failed the rate group test and must be amended. Am I missing something? I guess what I'm really getting at here, is can a standardized plan be considered discriminatory in this scenario? How can that be?

I think everyone seems to agree that a literal interpretation of the rules is that there is a controlled group here. The question is really, would MR be okay administering these two plan's as though they were NOT a controlled group, due to the fact that everyone agrees that it's insane that married couples with children should be at such a disadvantage when compared to a married couple without children. I think it's also pretty well accepted that this outcome is unintentional. Is there some sort of IRS informal policy that says, lets just not go there? Has anyone ever heard of this being an issue? I think we all agree it happens often.

Tom - Is this because of 1.401(m)-3(d)(4), regarding the ration of deferrals to match for HCE's compared to NHCE's?

You plan probably has a section that says, if the Plan is projected to fail the ADP test, the sponsor can place an administrative cap on HCE's deferrals to ensure the test will pass. Because the NHCE's are deferring 0, the only reasonable limit for the HCE's is zero. And with a plan imposed limit, anything over that limit is a catch-up. (without the such a plan provision, this won't work). This is all very well documetned in the ERISA Outline Book somewhere. Perfectly legit.

She just needs to come up with the collateral. OF course if she defaults, the collateral now becomes a plan asset, and it may be an asset that the plan is not allowed to invest in, and yada yada yada... It is a clever solution, but it might not be practical...

Why can't you pass a4 without the QNEC? Are there a lot of non-key HCE's? Did you try cross-testing? mputing disparity? Don't seem to be any gateway issues... Or does the plan inlcude key's for the THM?

Sounds to me like you've done your homework. I've got nothing to add...

There's LOTS of plan's with 3% SH and last day/1,000 hour rules on the profit sharing. There were no rule changes prohibiting this plan design. Sometimes they can write in a manner that is less than straightforward. That you're not finding antyhing to corroborate makes perfect sense!

What if there is already a contract to build the house?