austin3515

The only thing I'm personally leery of not announcing before the beginning of the plan year is how much to defer to get the full match. The definition of discretionary is that you get to decide later on, even after year-end. But imagine if you never had a match, and then March 2019 you decide to do a 100% of 6% match for 2018. If I was never told to contribute 6% that might sort of make me mad.

I completely agree with what Poje said earlier about "if the docs says all sources, then include all previously ineligible sources and if says deferral than its deferral only with no new sources." That really should carry the day here and be a pretty universally acceptable approach. I had certainly speculated that if I was a document provider writing an amendment that's certainly what I would write. Which means nothing of course, but if Tom Poje would too, that means something!

Wow that is bazaar. And what of people who retire to New York? Double taxed I guess. Nice system.

Yeah we saw that too, but we have no idea what it means either. I don;t know what a post-retirement contribution to a 403b is, and I work with 80 403bs. It must mean something though and that's what is so annoying. What do you think abut the 457b aspect of it?

Can someone speak to whether or not contributions to a 403b plan are tax deductible for a New Jersey resident? someone is saying that they New Jersey does not recognize the deduction for 403b plans, but does for 401k plans. Yet I have plenty of New Jersey customers and this has never come up--much less the issue of basis that people would have in their accoounts. It could even get messier if for example they do not get the deduction in New Jersey and then they move to California to retire, and take the money out and pay California tax on the way out. This just cannot be. On a similar note, I heard the same thing about 457b plans.

Boy wouldn't it be grand if someone could share such a checklist on these boards there close friends :)

Is anyone aware of a way to request old 8955-SSA's filed from the IRS? We have a new client who wants to make sure they have D'ed everyone that they A'd as far back as possible (obviously just the ones who have closed their accounts). they don't have copies internally and the prior provider sent the last couple but that's it.

OK does anyone have the list?

Well but presumably the recordkeepers would have programmed their systems based on the proposed regs and it sounds like our document provided is preparing the SMM's at least based on the proposed regs. Probably would have been smoother with 3 more months than they were allotted.

I suppose it is the IRS's fault for being too late with their regs. That seems to be the problem. No one would do boo without knowing what the rules were going to be (and I can't say I blame them). But maybe it is Congree's fault for jamming through a tax overhaul with a week's notice. I know the IRS is still trying to catch-up with all the guidance needed on that front too.

Listen we can sort this out too, but when you talk about sorting this out for 1,000+ clients it gets to be a bit ridiculous. And no one (aside from billion dollar plans perhaps) wants to spend a dime (let alone 5 minutes) discussing what these new rules mean for the plans. Granted my employers are generally smaller, but even my larger clietns really haven't got much interest in what could easily be called "excruciating minutiae"

Seriously is there anyone else out there who sees thing as a giant mess? 5 weeks away the rules change and no one is ready for this. We should have had amendments in place and the recordkeepers should have been ready to flip the switch. None of that is possible because the IRS just issued proposed guidance. Yet there will be demand from those in the most dire financial straights. Am I being too pessimistic here?

Very impressive analysis of course, but omg. This is for hardship distributions. This is turning out to be the most complex policy change I can think of recent memory. It occured to me that for the daily val plans, this is going to be 100% driven by whatever policies the recordkeepers implement. Has anyone heard from them?

But no one is using the new rules? Every law firm out there is blasting my clients in boxes with these new exciting rules for hardship distributions. And we're saying everyone;s response is, "maybe by the end of 2019 we can do this"?

So someone is losing their home, it is legal to take hardships from SHNEC, amendments won;t be finalized for months, we're saying the implementation is delayed beyond the statutory date, and this participant is "SOL"? I am really uncomfortable with that. I thought there was leeway to adopt amendments retroactively. But we're saying here consensus is essentially these new rules are not yet effective???

Corbel is telling me the amendments wont be ready and don't need to be signed until 2020/2021 anyway (I assume that was in the proposed reg?). It's a discretionary amendment though, so I don;t know. I just get the feeling that no one has any idea what the heck is going on with this change, or at least certainly not from operational perspective. Someone needs to write an article...

Wonderful. But participants can still take a hardship from Safe Harbor Accounts on 1/2/2019 though. I wonder if the recordkeepers are even ready to do that.

What are people doing to notify participants about the new hardship distribution rules, since the document providers have yet to issue their stuff? At least Relius has not yet done so...

Unbelievable. I was researching from home. I read the preamble to the regs which says in no uncertain terms though shall not add an EACA mid-year!!! I emailed a client and told them we had to do it 1/1 or we couldn't do the EACA this year (They wanted 4/1). After finding the portion of Sal's book that clarifies that if only newly eligible ees are swept in (which is my situation) it is ok to do. So I had to email the client and tell them I messed up. Embarrassing. But it's still stupid that there is a disincentive to adding auto enrollment covering all employees mid-year.

I read in one article that it was possible to add an EACA mid-year, but you would only be eligible for the 90 day withdrawal benefit, and not the 6 month penalty free ADP correction period. That is fine with me, but everyone else seems to say (and really preamble to regs was pretty on point) that you can;t add an EACA mid-year. Which is really stupid. Follow-up: Anyway, let's say hypothetically I can't be an EACA for year 1. So now what, I have to be an ACA for 6 or 9 months, and then I can switch to an EACA, right?

Is a money purchase plan sponsored by a governemnt/government agency subject to the same spousal waiver rules applicable to private money purchase plans? i.e., must the spouse consent to non-annuity payment of benefits?

Can I ask what this was about? I have never heard of a DOL audit (aka Investigation) getting to this level. just curious was this like embezzlement or someone who forgot to send an SAR or somewhere in between! Perhaps you're not at liberty to say which I understand...

I meant to come back and clarify that this was a tax-exempt entity 457b plan and that all monies were 100% vested. I submitted a question to ERISApedia and essentially got the same answer. Thanks Carol!!

This hasn;t happened, thank goodness, but the question being posed by a board member is, if a participant were to embezzle money, or was terminated for some other crime against the employer, is there a way to forfeit their balance? My assumption is that nothing the participant can do will eliminate the liability to the participant. Yes, I am aware of the fact that this is doable in a 457f plan which is still subject to a substantial risk of forfeiture. I assume there is no possibility of this in a 457b. Let me know what you think!

My understanding of this (and I base in part on the wording of the plan documents) is that the participant is responsible for the RMD's. The recordkeepers will send notifications to the age 70 folk to remind them. But there is no such thing as a failure of a 403b plan to pay an RMD as there is in the 401k world. Read the document. What you will find is that the Plan does not have an affirmative obligation to pay the RMD, entirely for the reason described by Peter above.