austin3515

Partners have ordinary income and Guaranteed Payments. Can we amend the Plan to exclude from the calculation of earned income Ordinary Income (but NOT Losses)? The situation is that the CEO is a 10% owner and does NOT want the extra match attributable to his ordinary income. I know I cannot exclude the losses because if I did their match rate would be higher than the rank and file and that would not pass nondiscrimination. They want the match to be based exclusively on guaranteed payments. I also recognize for nondiscrimination testing, I would still use the statutory definition of earnings.

I figured out what happened. The SSA reporting was on an old Money Purchase plan merged into a 401k plan. Must not have used the C code to transfer the benefits to the new Plan #.

I think this meets the definition of insanity. it was EFILED for crying out loud.

A participant received one of these letters in June 2015 - but we e-filed an SSA for this client in 2012 and included this participant as a D... Anyone have this happen before? That's ridiculous!

Good thing I gave you credit, cuz I just emailed him

Now that would have been a very very very smart thing for Corbel to do. I don't think they did that, but I am going to email them with that suggestion... Very very cool observation.

If I had an employee start in December of 2014, work through 2015, and work for part of 2016, he'd be eligible for 25% match of total 2017 wages to a SEP IRA I'd have to set up for him From this web-site: https://www.irs.gov/Retirement-Plans/SEP-Plan-FAQs-Participation-Requirements Example: Your SEP plan uses the 3-of-5 eligibility rule, uses a calendar year and has no age or compensation requirements. To be eligible for a contribution for 2015, an employee must have worked for you for any length of time in any 3 years in the 5-year period from 2010 to 2014. An employee who worked for you for two months in 2010, 2013 and 2014 must share in the SEP contribution made for 2015.

Sounds like the exact same reason. This was a public service question for all those bundled providers whose ignorance will cause potentially irreparable harm. If I could them as a client, rest assured I will take care of it for them. I would just hate to win the business only after this monster rears its ugly head...

I am aware that would be the obvious choice. The point of the question was to highlight a very very real phenomenon that is going to catch a lot of "bundled" plan sponsors off guard. I'm telling you it is going to happen, and it's all because of an overzealous indirect interpretation of a rule. That;s what I was trying to highlight. So I'm curious to know what the IRS said in response.

This was my question But the lame IRS answer was "to be discussed from the podium." Does anyone recall what was said? It's question 12 on the 2014 ASPPA Q&A. ASPPA's proposed response was basically an argument agains the IRS's interpretation on the matter. Plan A is a calendar year 401(k) Plan that provides the basic safe harbor match. The Plan holds “regular” matching contributions from prior plan years that are subject to a vesting schedule. The Plan is top-heavy and at least one key employee receives total allocations of more than 3% of 415 Compensation. For the 2015 plan year, only deferrals and safe harbor matching contributions are to be made. There are $3,500 forfeitures of regular matching contributions waiting to be used. They cannot be used to reduce the safe harbor match under IRS policy. If the forfeitures are allocated, the plan will fail to be exempt form the top heavy rules, and a top-heavy minimum will be required. The top-heavy minimum (after using the safe harbor match to offset the top-heavy minimum, as is permitted) is about $90,000. The safe harbor match is only $45,000. Is the plan forced to reallocate the $3,500, giving rise to an additional contribution obligation of $90,000?

Insurance premiums, lawn maintenance, snow removal, etc. etc. Report as other expenses?

Small illiquid REIT in a 401k plan. Do I report as a real estate? The investment is definitely not filng a separate 5500 as a DFE so I thgouth I had to look through at the underlying holdings.

Now we're talking! Send me a PM if you would like to me propose!

Once in my life time, I did the one-to-one as a match to avoid the ridiculous outcome of having a host of people with $1 in their account which would inevitably be forfeited anyway. Sometimes reason has to trump strict readings of the rules (at least in my opinion).

Does someone in your office have expertise in these designs? Your getting great advice from people in the know, but this is the kind of thing where the finer details can get you into a lot of trouble. If you want to be doing these designs I would strongly recommend getting at least your QKA from ASPPA. Not trying to be rude, I honestly have the best intentions, which is to not see you get burned.

Let's say an employee is getting a signing bonus for $1,000 if he/she agrees to take a position with Company A. The employee is getting the bonus in their first paycheck, and eligibility is immediate. Assuming the document does not specifically exclude any form of bonus, is there any reason not to treat sign-on bonus as eligible wages for purposes of calculating the 401k payroll deduction? For example, the bonus is not related to services provided. So, similar to severance only the complete opposite. Biazaaro Severance if you're a Seinfeld fan! Personally I think it is clearly eligible but I am trying to explore this fully and hear other opinions.

It's not a client, the question came from a friend. My friend was the person against whom the transgression was committed. It seems to me that if the company put an ad in the paper indicating what an employee's account balance was, that must be in violation of some law. That is not what happened here, but whatever law would prevent that would be what I'm looking for. I did some searching on a fiduciary duty of privacy and/or confidentiality but found nothing.

What protections does a participant have that his or her 401k information (in this case their balance) will be handled with discretion and kept private. I don't want to get into the specifics but suffice it to say I received a question from a participant (not of a client of mine) who is outraged that his information was shared with a third-party without his consent. It was NOT disclosed in the context of services necessary to the administration of the Plan.

I just saw one the other day, and it looked as interesting as a Model T

That;s what I meant, perhaps my "drop a dime" line was misleading. I just meant report them to the DOL.

Drop a dime to the DOL (if you can find a payphone ) notifying them of an orphan plan. End of responsibility. I'm curious though, did they close doors? Are they out of business? Did they go bankrupt; if so there would be a bankruptcy trustee.

What is a show-stopper is if people are not offered the chance to defer from their first paycheck after 10/1. I've seen it happen (despite my admonitions) that the first 401k deposits were not until the middle of November. The point is, the requirement is not that the documents are signed by 10/1, but that there is a 3 month plan year, not just in form but in operation.

That was the crux of the question, but an employer can sponsor more than one plan, they just cannot contribute to more than 1 plan.

I think the EOB is pretty clear that a 0% MP is ok, and it was in the section of "can a plan JUST allow for rollovers."

Anyone have a problem with a SIMPLE Plan sponsor setting up a 0% money purchase plan to allow the owner to do a rollover and take a loan? Yes, the employees can make a rollover contribution as well.