austin3515

Be that as it may, let's say you own a restaurant. You can either pay people to do nothing, and get Uncle Sam to pay for it, which nets you nothing. Or just let them collect unemployment. Compare that with say an accounting firm that a) paid its employees; b) profited from the services rendered; and c) got said payroll expense which generated revenue for them, paid for by Uncle Sam. Now call me crazy, but that ain't fair.

Well, I thought the rationale was that all of these businesses that needed the help the most will have nothing forgiven because they couldn't reopen until recently. Meanwhile all of the businesses that were not affected "at all" and stayed open have no problem getting their debt forgiven. That's not a partisan issue at all. PPP was totally bipartisan, so if the "rich" get their debt forgiven while the decimated get screwed, everyone will pay the price. Democrats and Republicans. Strike that - the Dems did their part in the House I guess. Would be silly if none of the restaurants got any help, or the dentists, etc. I lean to the left, but does that sound like a "liberal" statement? It just sounds like common sense to me. OK I'm getting off my soap box now.

If I recall the point he made it, it was that all of those Earned Income Rules were intended to equalize the playing field as much as possible and treat them the same. And it seemed contrary to that objective to treat them so very differently for purposes of PPP. It is hard to imagine that Congress intended to treat partners different then S-Corp owners in terms of their eligibility for PPP. But I've said all along, we need a damn FAQ to settle this once in for all. It makes no difference what Larry or Derrin says. We need the IRS guidance. But anyway, who has the low down on when this will be obsoleted by the extension to 24 weeks? IT seems to have stalled after passing in the House?

I don't recall perfectly well, but are those 100% finalized, or just done for the short-term for plans that were terminating? I wouldn't do it yet. i.e., I think as more guidance gets released they might change the amendment (at least I suppose it would be impossible to rule that out).

You made my day.

Thats exactly what I'm doing - One amenmdnet, but it says "If this, then this applies, else that applies." I'm really more curious if others have reached the same conclusion. When I was discussing with FIS I just couldn't tell if they were really thinking "Hmm, the International Man of Mystery has a point" or "This guy missed the boat on this." I mean I guess overall, one policy that says "QNECs/QMACs are eligible for hardship" or "are not eligible for hardship" just doesnt seem practical. Am I alone in that? I often find myself alone on these message boards, so I'm comfortable being here, just curious if I am or not...

We have been administering hardships as follows for our clients: -If the document said "all sources" are available for hardships, then we allowed from QNEC/QMAC/Safe Harbor. -IF the said just Elective Deferrals then we treated them as not eligible. This treatment appeared to us at least to be the most logical path forward. The problem is that the Corbel/FIS Amendment was drafted it forces us to choose a default of "QNECs are available" or "QNECs are not available." A binary decision which will lead to probably half of our amendments requiring employer sign off. I prefer to have a formula that says "IF all sources is selected in the Adoption Agreement, then QNECs are available. If individual sources were selected in the Adoption Agreement, then QNECs are not available." What are others doing with this? I'm not sure how other document providers handled this, but I guess it doesn;t have to be exclusive to Corbel/FIS. Are others in the same pickle?

After all this, I just can't wrap my head around the DOL actually writing this down: "You cannot mail a hard-copy of this notice." That is a breathtaking statement based on their past aversion to e-delivery. Mind you there is not a requirement that a "hyperlink" be provided, and how could you since a login will inevitably be required. But I guess this is over now.

Now were talking. They actually said "no paper." So that was stupid. This rule is completely worthless. RBG, I know youre going to say "I said that already" but until Peter posted the preamble I thought it could be suggested/argued or whatever that paper was above and beyond. I did not know until his post that they specifically said you cannot use paper for the NOIA. I thought you were inferring paper would not qualify. It doesn't matter I guess. Thanks!

Listen, I think this at least something worth confirming with the DOL. Without this intepretation, there is no relief at all with respect to terminated participants. We're not getting their emails. It just isn;t happening. Not for anyone. I think its worth asking the DOL at some Q&A.

What's the reasoning here? In this situation I think hard copy is worse because it results in more effort on the part of the participant to be able to access the disclosures. It's better in the DOL's opinion. Why would I say such a thing? You can always send a notice on paper. There are no hoops at all to jump through to be able to send a paper disclosure, no "Safe harbor rule on mailing paper". You just mail the paper. That's it. There are only hoops to jump through to send a disclosure electronically. So if as part of the e-disclosure safe harbor I am "required" to send a disclosure electronically, if I voluntarily opt to send that disclosure on paper then I am going above and beyond the safe harbor. I should be more clear - that is the case I am making / the question I am asking is wouldn;t it be reasonable to conclude that mailing the NOIA on paper is consistent with the Safe Harbor?

I'm only asking if it is reasonable to assume that mailing the NOIA on paper will qualify for the safe harbor. I'd say yes because it is BETTER than sending it via email. All of these hoops and hurdles are to obtain the luxury of emailing something versus hard-copy. For this one aspect I'm going to mail hard-copy and not email, so that should be construed as going above and beyond the safe harbor. Yes that's it. that is my point.

https://ferenczylaw.com/flashpoint-the-dol-edisclosure-regulations-reduction-in-paper-and-mailing-costs-but-no-guarantee-that-the-documents-have-been-read-under-intel/ From Ilene's article: The NOIA must contain only the following elements (where items are in quotes below, that specific language must be used: -Unless the document is attached, the website address with sufficient instructions as to how to locat the Covered Document on the web page to provide ready access, OR a directly hyperlink to the Covered Document. [my point is, it can be mailed on paper to the same affect].

Not according to what I'm reading. The NOIA requires only this, which is a far far cry from a link to a website. No reason this could not be done on paper just as effectively as in an email: "Any instructions needed about how to access the provided information (such as passwords, a need to download a mobile application, or the need to set up an on-line account to view secure documents);"

I disagree. The big give is allowing the employer to put the disclosure itself on a website. To not have to mail a 20 page fee disclosure is an enormous cost savings (or 35 page Summary Plan Description). If I only had to mail a 1 page paper disclosure with the NOIA required language that would be a huge savings. Dear Participant: "Log into your 401k account at ABC REcordkeeper and go to this section of the website." Why can't that be done on paper? I get that the rule doesnt say thats ok, but I just am struggling with the fact that no one else sees it the way I do... That would be such an efficient way to handle fee disclosures, including for the recordkeepers who will clearly have the problem I have described above.

Why not get email addresses for terminted participants??? Because it would be a pain.

I just read through Ilene Frenczys article on this, and it sounds all well and good. But I'm surprised no one is asking the question about sending the Notice of Internet Availability on paper. This seems like a very logical path for terminated participants because were not going to get email addresses for them at this point. And why would their be a notice that you CAN'T send on paper when there are hoops to jump through for the privilege of sending electronically. The value is clear - a 1 page notice that the 37 page fee disclosure is available on line. Has anyone else considered this?

Please share a link to your article. i'm sure it would be well worth my while to read it!

Can I do this: Send a letter to a bunch of terminated participants and say "Dear Term: Please log into ABC Recordkeeper's website and review the fee disclosure." IF the answer is yes I will say, and rejoice, Hallelujah!!

Wow it took a long time figure out we agreed :).

For a minute there I thought I was losing my mind :).

I guess I can;t understand why the advice isn't make the decision closer to the end of the 8 week period when maybe there will be guidance in favor or against. That's the advice I'm giving and you'll have a tough time convincing me I'm doing anyone a disservice. I don't see the advantage of a different approach. And clients (and CPAs) are obviously turning to us for guidance on what retirement contributions are eligible for forgiveness. So to say it should be referred elsewhere is probably just not realistic. I guarantee you I know more about this aspect of it then "most" CPA's. As we can see there is not much to know since they've told us next to nothing. Sherpa, 1 and 2 in your post are "obvious." The question becomes is it reasonable to claim them as part of the debt forgiveness calculation on a form you're filing with the SBA. So yes its obvious to fund it, its less obvious whether Uncle Sam is willing to foot the bill (outside of contributions specifically related to comp in the 8 week window). Now, as someone already referenced, for cash flow reasons it would behoove someone to know if Uncle Sam will be paying for it or not. If not, they may just as soon wait until September 15th to fund it. This is no small consideration in the middle of an economic and health catastrophe. The question that is really problematic has always been your 3rd point. There are obviously a lot of medical practices out there where the Docs are not going to pony up $40,000 apiece (their $37K + the staff contribution) for retirement contributions when their business has dropped 50% overnight. So whether or not this is eligible for forgiveness makes the difference between whether or not they will EVER fund it. In any event I come back to the first thing I said. Wait until the earlier of a) when we get the guidance ; or b) the end of your 8 week period before making any decisions.

So lets say someones 8 week period does end and they took Larrys approach. The reported that they spent enough for loan forgiveness and the loan is forgiven. But then they get audited and SBA or the IRS disallows that portion. Thats the worst case scenaro. That you reported it as eligible, and took the loan forgiveness, when you were not eligible for it. Oh and by the way perhaps you could have found more eligible ways to spend the money thus getting 100% forgiveness.

Though it was tempting to respond, I've decided to just ignore your invocation of nuclear war. There is just absolutely nothing stopping them from taking a hard-line "8 week expenses only" approach when they issue more guidance. I'm old enough to remember when the IRS concluded that expenses funded by forgivable loans were non-deductible to the shock of many on-lookers who expressed disbelief they could take such an outrageous position. I am among those who considered that position by the IRS to be outrageous. Counting 2019's profit sharing as a "payroll related expense" for the 8 week window seems, to say the least, "aggressive." And it would not seem outrageous to me if they said it did not work, depsite the open ended language in their 2 pages of instructions. I am hoping for some enormous Q&A that covers this and other questions that badly need answering. Not least of which is this owner-employee nonsense. Guidance just has to be forthcoming. I'm advising clients to be ultra-conservative until the SBA says we can use your interpretation.

I dont understand this. The downside is terrible. If they relied on this interpretation and the SBA later comes out and says "Seriously? You know thats not what we meant. The whole law is based entirely on the 8 weeks, and that was so clear that to take any other position was not in good faith." You don;t know for sure they won;t say that (heck I would say that if it were me, because it kind of is that obvious). And if they did come out and say that (which I notice you do allow can happen, even though it was buried in sarcasm and included a "shiny object" to distract the reader): a) They funded the 2019 contribution which they might not have done if not forgivable because it was discretionary. Even if they prefunded all of 2020 for the same reason, again they might not have done if not eligible for the forgiveness. b) And now the have to fund something that is in line on top of that in order to get the loan forgiveness. That would be a client that I would expect to fire me if that all happened based on my recommendation. And because I don;t like to get fired, I'm not comfortable setting myself up for this one. Now mind you I do not disagree with your literal interpretation of the very limited guidance that is available. But even you have reservations as evidenced by your "hedgey" language ("it appears to" and "can be read to allow"). That's CYA language. If I asked you (in 2019 anyway) what's the maximum loan amount, you would not say "the rules can be read to allow a loan of $50,000 or 50%".