austin3515

you meant the POST was old, and Regs are new! I didn;t realize the new proposed regs addressed this!

Thanks! Where can I get the proposed regs (other than your post ) Really, thanks! Do you agree that a match of more than 25% would satisfy? They wou;dn't get the match but for the deferral.

Can someone point me to a good write up of when you can send statemetns electronically? We work with a recordkeeper who we converted a bunch of plans too. New recordkeeper essentially has no email addresses. But yet they do not send statements. Instead they say we deliver them electronically. To me this sounds way off-base and I would love to point to some DOL document that clarifies that this does not work.

hey we can both respond however we choose! This a democratic society!

What does counting hours have to do with the question?

Pet peeve: Someone asks if something can be done or how to treat something and it gets side tracked into "why does the client want to do such a thing anyway"? If I wanted to know WHY a client wanted to do something, I wouldn't ask you all - I would ask the client! Laughing as I'm typing but had to vent...

Well, all taxable fringes are subject to OASDI so I'm not sure I get your logic?

Option 4 of course would have been to prove beyond any doubt that they were wrong. I was hoping this maybe addressed at an IRS QA or something. The problem is, it is not a ridiculous position. IT might be widely accepted by us pension geeks as not ok, but to an ordinary intelligent person, it's a benefit just like anything else - they're getting paid for NOT working. Sounds like a benefit. Again, I disagree with the position, but it's always harder to dispossess people of positions and interpretations that are grounded in sound logic!

I have a client who is trying to argue with me that vacation is a taxable fringe benefit and thus not eligible for contributions based on their plan provisions (which do exclude taxable fringe). I know it's ridiculous but its hard to point to something concrete...

I have a weird situation, it's a 6/30 plan year end, where the employer contributions are funded each pay-period and are substantial. So the HCE neds to limit his 403b contributions. Problem is, they way everything plays out, he never generates any catch-ups. He never exceeds 402g, and because of the way he scheduled his deferrals, he doesn't have enough 403b in the plan year to reclassify enough of his 415 additions as catch-ups to pass (he barely contributes 403b in first 6 months of calendar year). Options: a) Go back to 2015 and reclassify some unused catch-ups?? b) Take the position that his 403b was limited for 415 to ~$8,000 (he gets around $45K of Profit share, for a total of $53K). Therefore, he can cotnribute $14K and treat the extra $6K during the year as a catch-up. I know b) works for an ADP limit, what about 415?

In case you're not sure what I am referring to: http://www.wklawbusiness.com/store/products/coverage-nondiscrimination-answer-book-fourth-prod-0735581940/hardcover-item-1-0735581940

That;s why they let Tom literally "write the book."

"You just blew my mind"

Ah, ok, I was not grading on grammar, only substance!

There is nothing technically wrong with it. It's the textbook definition of a CODA and why technically 401k is considered an "employer contribution." Well, I guess this is worked backwards, but the point is the same. Your choosing between an employer contribution to the plan or a bonus. It is a pre-tax deferral, subject to 402g and ADP testing.

We put our resolution right on the contribution spreadsheet.

Switch to FT!

http://www.asppa-net.org/Portals/2/PDFs/GAC/Comment%20Letter/IRS_Compliance_Questions_Comment_Letter5.31.16.pdf Especially read the piece about trust EIN's. It sounds almost rude and snarky, but then it is so true which makes it very reasonable to say...

HAve I ever had this ridiculous request in particular? No. Have I ever had ridiculous requests for which I could not fathom any rationale? Absolutely. There is no telling what client's passions will convince them of.

I'm sure you would be more careful than me, but then you're posting under your real name and I post under a pseudonym And presumably Tom's document drafters and mine (who I know I have the utmost respect for) thought it was ok. Not to mention the IRS agreed that it was ok with none of those caveat statements about "this provision could potentially be discriminatory!" So call me cavalier for making such a controversial statement, but I still stand by it even if perhaps I may have overstated by a millimeter or two.

What difference does this make? Philosophy is inherently subjective and it doesn't sound this client is asking for opinions on philosophy. Since anyone can do either with no restrictions whatsoever, I don't see where the issue would be. Not to mention every pre-approved document includes the option to match or not to match Roth.

It wouldn't be a coverage issue because everyone is eligible to make pre-tax elective deferrals. Just an ACP testing issue. Your treated as eligible for the matching portion of the Plan as long as you have the ability to make matched elective deferrals and you met any allocation requirements. If the sole reason you did not get the match is because you didn't make any "matchable" contributions, that's not a coverage issue - that's an ACP test issue. This situation is no different than the employee who makes no deferrals at all. They could have, and that is what matters. They chose not to, and that does not matter (for coverage).

Another thought: The key here is the choice between cash and compensation. That is what makes the CODA. So no election forms that say "I'd like to contribute $53,000 this year." If you have that, then you've got yourself a CODA. Perhaps my clients are doing that informally (not on paper), I would not know... But as far as I know the Employer is the one deciding how much each employee gets in contributions.

I know the type. They don't know why they feel so strongly about something, but they do, and though the rationale might not make sense to you (albeit, you are subject matter expert), their instincts have made them tons of money in their life time, so hey, better trust all of those instincts! I think as long as your not safe harbor, you just need to pass the ACP test. It's not a BRF issue because everyone has the ability to make pre-tax contributions and is therefore eligible for the same match. They voluntarily elected to contribute Roth, and at their own peril it would seem.

He had no 401k contributions. Those were ineligible contributions, so they do not count towards 402g. You should adjust it off of payroll so it doesn't show on his W-2.