austin3515

It looks like when doing 1099's I would include code L, but ONLY code 1 if the participant is under 59.5? If they are over 59.5, it is just code L? Agreed? This person is active so no offset.

Now that is hysterical. Same plan...

No, it definitely hurts. That's why I added it to my example. If HCEs were not excluded from SHNEC, there wouldn't even be a question, it would clearly fail 414s.

" I agree with what you are saying when the plan still allows repayment up to the end of a cure period. " Don't they all allow some form of cure period? I mean I have never seen a loan program say they moment you term, it's all over. There is always some opportunity to repay

Well, let's say the "reasonable" definition is that bonuses are excluded. Now, all the HCE's are over $265K even without their bonuses. What say you to that plan design?

Timing of deemed distribution Amount of deemed distribution. These terms for me raise questions about whether or not it would apply differently in the case where a distributable event exists. The above terms are for "deemed" distributions, and when there is a distributable event, they are treated as "actual" distributions. Thoughts? Your point would need to be that the loan is deemed distributed first, and then offset 2nd.

Is a Safe Harbor plan deemed to satisfy 414s if the HCE's are excluded from the 3% SHNEC? Logic tells me no, as you could just exclude HCE's from the SHNEC and then exclude everything but thought I would check!

Hjonestly, I would have them pay the amortizartion schedule balance as of the date of term :) But that's me being a cowboy. Anyway, if anyone has the "clutch" interpretation of the regs that puts this to bed that would be SWEET!!

100% agree. I would definitely not. But a question came up recently and as with many things I am surprised I cn't find a clear answer anywhere. The regs seem to be pretty clear though that TAXABLE interest accrues through the end of the grace period. I was just hoping someone could point to something that clarifies one way or the other...

option b) includes reference to the grace period. So assume the grace period ends on 6/30/2017.

Johnny has a $5,000 loan s of 1/12/2017. He terminates employment as of that date. His 1099-R is: a) $5,000 b) $5,000 plus any interest that accrues between 1/12/17 and the end of the "grace period" I realize that for loans that default when there is no distributable event the interest is accrued through the end of the grace period. Is the same thing true for terminations (i.e., when there is a distributable event)?

Have a plan that did not auto enroll a few employees going back 3 years. Am I crazy or is EPCRS silent on how to determine ADP in the case where the plan is tested separately for otherwise excludables? Do I run one single test? I guess that is the answer, but I can't find anything. Even the EOB seems to ignore this obviouis question...

Can anyone point me to a good article? I have a client who wants more information.

I still don't like it. Let's talk about severance. The argument of "they would have received the pay had their employment continued" has been made many times even about severance. "If my employment had continued, I would have been paid for those 10 weeks!" I know we have all heard that argument from people and "batted" it down and said no no no, the comp was never earned. I am sorry I just do not see any material difference between 2 weeks notice refused but with payment provided, versus 2 weeks of severance with an involuntary termination. They are both essentially involuntary terminations with salary continuation. I guess I'm going to stop posting about this now though...

Well, isn;t the question "can you use it in the first place"? If it is "severance" it is not legal to use it. I would be curious to see what the language you are referring to actually says.

She used to work their full-time so is legitimately eligible.

I disagree with the conclusion, I think it is severance. When you get paid unused sick time, you're getting pay for the days you worked. It just so happens you didn't take the time off you were entitled to and instead worked. In this case, no work is performed for the 2 weeks pay. The rationale of "the pay would have been received had the employee continued" is not what they are referring to. They are referring to pay that was earned before severance. e.g., commissions, performance bonuses, final paychecks, paid time off. The mere fact that that the employee wrote down on a piece of paper "I'll work if you want" is not materially different from the employer terminating the employee with no notice and paying them 2 weeks severance. Does anyone change their mind?

Princess, the key word you used, which the IRS has discussed as well, is that it is "treated" as earned. IT is not actually earned. By my clock you still have 3 days to eliminate the last day rule. But remember, amendments must satisfy nondiscrimination so if the only one to benefit is the partner, then (assuming he is an HCE?) you are outa luck. P.S. Is 401king your father? Ha ha ha

So the wife comes in for the afternoon to answer the phones and instead of contributing $5,000 hubby contributes $10,000? It just seems rough... Hey it's a great answer if it works, but I'd be sweating it a little on audit...

https://www.irs.gov/pub/irs-tege/directive.pdf Does anyone think this "Carol Gold" memo about abuses involving short-term employees would apply to the owner's spouse working a "few days" solely to have her included in the ADP test as a zero? I'm trying to find a reason why it is wrong because it just doesn't feel right. They would be the only two HCE's so it effectively doubles what the HCE can contribute.

In my experience the investment provider has known that the investor is a qualified account so I've not had to deal with that, but good to know!

http://benefitslink.com/boards/index.php/topic/59917-withholding-on-retirement-plan-distributions-945-deposits/?hl=penchecks#entry265615

In what way? I have lots of pooled accounts, no separate EIN's and I've never heard of any issues?

But why bother? It's not yet required on the 5500. You can use the sponsors EIN for 5500 filings. Perhaps it is a withholding issue?

Never mind my document does have provisons regarding the excess occurring in "this plan" - it's just way at the end. I couldn't find a way to delete this post... OK I guess you can delete posts and not topics.