austin3515

The requirement you cited above (regarding adopting the language before the first day of the plan year) isn't exactly on point because it deals with what must be done to be a safe harbor plan. We are trying to NOT be a Safe Harbor Plan. I know, I know, if your plan doesn't have the language and you fail to meet the requirements then you're not a safe harbor plan. I get that, I just think it's an indirect conclusion. I kind of feel the same way about the timing of the notice requirements. Those are the notice requirements for being a safe harbor. I think some specific clarification regarding changes to a safe harbor plan after the notice is distributed but before the first day of the plan year would be well received. I don't doubt what you are saying and in many respects your rationale is completely sound. If we disagree on anything it's whether or not some additional clarification/guidance would be welcome (even if the guidance merely says that any such amendment would not be treated as a reduction/discontinuance). That's all I'm looking for from the IRS.

Participant terminates in May 2018 with a $10,000 loan. Participant has until the due date of their 2018 1040 to repay the loan to avoid the taxes under the new tax rules. Question is, if that participant does NOT close his or her account, can they re-contribute the $10,000 to this plan if it is past the grace period? Our plans typically do not allow former employees to execute rollovers, which I think technically this would be. Thoughts?

This would be a great ASPPA Q&A if there isn;t something concrete out there. I am inclined to agree with you but, I could also understand someone like me having some reservations considering how many rules there are about amending these plans. I just like to have official guidance for things like this.

Plan distributed the Safe Harbor Notice for 2019 in November 2018 indicating the Safe Harbor Match would be made. The Employer loses a big customer on December 15th 2018 and on that date they call us to discontinue the Safe Harbor effective 1/1/2019. Are there any timing restrictions considering the notice was already distributed? Could the plan have been amended on December 15, 2018 to eliminate the safe harbor for ALL of 2019? Or is there some form of a 30 day notice required? Kevin C and Larry Star commented in this thread but it was more of an offshoot the original question. I wanted a question dedicated just to this topic:

Well to be clear I neither agreed nor disagreed :) But I did find at least very lengthy discussions on just this topic. But they were so old they can barely be trusted. I see the point about the commitment not being "solidified" until 1/1/19. I am just not sure there is a black and white answer anywhere. But if someone has something (even an ASPPA Q&A) I would sure like to see it. Not that I don't trust you guys of course! Maybe I'll start a new thread...

I just don't recall the rules for terminating a safe harbor plan after the notice was distributed to the participants. And they're not terminating the plan, they're merging it in. But like I said I'd be curious to know if the plan was a safe harbor and whether the notice was distributed, and whether or not notice went out prior to 12/31/18 that this was all ending. Depending on that fact pattern, I think the plot would thicken.

Isn’t it the anti-cutback rules that your position is based on? Those rules don’t apply to SEPs. And the rule was added ton401k/ps plans because without them you could cutback in benenfits. So if that rule does not apply then what rule is stopping you?

Oh my God make this effective 12/31/18. Someone botched that one in my opinion, and you have 3 days to fix it, can I get a "Hallelujah!" A day makes all the difference in the world in one sense (by eliminating even a shadow of doubt), and no difference at all in another sense (because really what practical/logistical difference does it make?).

Perhaps there is no legal requirement, but it sounds pretty cold not to give people a heads-up. As a practical matter you should tell them before their first pay check in 2019. And you did not say this was a safe harbor 401k plan, and whether or not a safe harbor notice was handed out. That would make this a much more interesting question.

The key is that the 3 separate employers are not "sharing" the employee. The bookkeeper just has 3 separate jobs/clients. Think about two independent CPAs who operate as separate Schedule C's, each with their own clients. But they hire a secretary who is paid by CPA 1, and CPA 2 reimburses CPA 1 for half of her pay. That secretary is a shared employee. It doesn't really change if they each pay her directly for half of her time, but these things are usually set up where one reimburses the other.

Wait I know what it is, I spilled some covfefe on my laptop this morning, that's gotta be it.

Oh it's important and if you can answer it I'll say thank you very much :)

Mike - I googled it for myself. This is weird: "Your search - dispiary factots - did not match any documents." That's bazaar, the internet must not be working today.

411d6 is the basis for the question actually. I'm sure it was done initially because it helped in testing, I guess it's better for younger HCe's, right? I noticed that the EBAR's drop down as the NRA drops down. But now they are all old and merging with a plan that uses age 65. So I am trying to unify the plan designs with as few special addendums as possible.

I've never been one to let a snarky comment go unchallenged, so despite my overflowing in box... You make it sound like I'm a client calling you for a 50 life cash balance plan for 2018. These are message boards, man, don't reply if you don't have time.

You're welcome to use the more complicated approach to get to the same objective. What you do with your clients is up to you. I have plenty of BIG NOTES in my clients files by the way, but every one of them was when faced with no alternative. Keep It Simple Stupid. Words to live by.

Gee golly willickers, that's sound advice. Thanks Pa.

I like the idea, but personally not the indirect nature in which you end up at 65 for testing. I try to keep things as simple as possible, and if the NRA is 65 in the doc, then I'll know just what to do every time (and more importantly so will everyone in the office).

You've never heard of a dispiary factot before? What are you taking a high school class in 401k plans or something?

One Plan uses "top-paid-group" and the other does not. The coverage grace period applies just to coverage. It does not apply to the Plan's definition of HCE's. Perhaps you might suggest that it is implied, but that is different then it being documented somewhere. I stipulate that it is implied, but I am hoping to find something on-point in terms of an ASPPA Q&A and the like.

Tom, what happened to the Grinch?? I think you should remain Grinchy until at least the new year... I asked another well known name in the world of 401k plans, and he told me this would work. To tell you the truth I can see the logic in it. There is not one practical benefit that is being cut back. By the way this is just a DC Plan (not DB) so I presume the MVAR thing doesn;t apply in this circumstance. I realize this section is just "cross-tested" and not specifically cross-tested defined contribution plans, so I suppose I should have clarfiied that this is not a cash balance plan but rather a 401k/PS Plan...

Seemed like every time I hit post something else came up!

If you are a paid preparer I'm sorry but I'm pretty sure that was a mistake to let it lapse. The following link says anyone preparing a form not specifically excluded must obtain a PTIN. See page 8 for the list of forms that do not require a PTIN. You'll note that 5500 and 1099's are on the list, but 940 is not. Logic would suggest that the IRS includes the paid-preparer/PTIN fields on those forms where the PTIN is required. https://www.irs.gov/retirement-plans/preparer-tax-identification-number-information-for-employee-plans-professionals Apparently it only takes 15 minutes to get one though. https://www.irs.gov/tax-professionals/ptin-requirements-for-tax-return-preparers

I have to credit Andy H with an idea from something like 18 years ago with a post that sounds brilliant. So can I amend the NRA to 65, but provide for a full vesting an Early Retirement Date that is defined to be identical to the existing NRA? The plan already allows for in-service distributions at the existing NRA, and that would not go away merely because I am changing the Normal Retirement Age. Thus, the participant's benefits are protected, and I get what I want which is to be able to run testing at age 65.

I just found in my Basic Plan Document that we are not permitted to use SSRA for testing any longer. I'm really annoyed that I might be stuck with 55 for a testing age but I see no way out...