jquazza

It's probably a control group. No they do not have to cover the LLC employees in the ABC plan, but you do have to take into consideration these employees when running your coverage test. Yes, they can have a separate plan for the LLC.

Aside from the BRF issue, if you're intent is to keep the funds under the protection of ERISA, have you considered the fact that the plan for the other business might not be an ERISA plan (if it covers the partners only.)

That is correct.

Highly compensated employees are not necessary key employees, so your vesting schedule has to satisfy the top heavy minimum vesting.

Gburns, Having multiple plans is ok as long as you remain cognizant of the coverage rules. The problem with individual (k)s or Solo(k)s is not from a compliance perspective, but from the vendor's. Most vendors won't allow sponsors with employees (other than the self-employed individuals) in individual (k)s. These vendors have set very low fees for these plans and having to aggregate an individual (k) with another plan would complicate the compliance testing and increase their cost, thus not worth the few hundred dollars they charge for an individual (k).

Mbozek, a Trustee has control over the plan assets and that makes him a fiduciary. Whether it excercises that control at the direction of another fiduciary is irrelevant. The article from the DOL published last week makes it very clear.

The minimum would be 1 hour (just kidding but technically correct.) You can just prorate the 1,000 hours/year to your period, so 250 is your answer.

Company A only purchased the assets of B. I know I will raise a wave of response here because this is a contentious point, but IMHO, they became new employees of A on the date of the acquisition, so unless you have 5% owners, you won't have any HCEs from B this year.

Agree with Andy, I would test this as a BRF and, the partner being the only participant who benefits from an early allocation, that would not pass. That's assuming of course that the partner is HCE and that there are some R&F NHCEs.

Belgarath, I agree with you, I should have qualified my statement. You have to admit some people do push it to the limit with the VS plans and I am not so sure the original doc provides much reliance, especially if you establish one class for each individual, to me, that sounds like a substantial deviation.

Plus the fact that you need a VS or ID document and then apply for a FDL or you can't use most of the self-correction methods when something goes wrong.

I don't see how it solved your problem, doesn't your TPA/Payor require the foreign recipient to get a TIN? I think most everyone on this board agreed that the TIN wasn't required (unless the recipient requested the reduce tax withholding rate per his/her country's tax treaty.) So, will the payor will issue the check now? Maybe they should have read the instructions to the 1042-S first, before denying the payment.

Tom, I think you missed Fred's point. Catch-up contributions should be excluded when you calculate the ABR%. So, if the participant in question got in effect $3,000 catch-up, $2,000 from an excess 402(g) and $1,000 from a recharacterization of his deferrals to catch-up CTs due to ADP failure, in the ABR, you will only take into consideration the deferrals that are not catch-up (whether the catch-up CTs are from 402(g) excess or ADP failure.) I think that's what Fred wanted to know.

No/yes, catch-up contributions need to come from deferrals, there is no PS catch-up.

If she waives her rights, then the contingent beneficiary under the plan gets the benefits. I do think it is the proper way to handle the situation. Have the beneficiary waive her ights to the benefits and pay them to the contingent beneficiary under the plan (might end up being the estate if no one is named, you will have to look at the plan default provision.)

Bud, I disagree, if the payments are not in concordance with the amortization schedule, the default could occur much sooner because 72(p) requires level amortization payments. So, unless the participant refinances the loan, he will not meet the exemption of 72(p). Now, if the laon is deemed distributed (and not distributed,) you should be able to apply the Bankruptcy payments to the defaulted loan which would create a basis for the participant.

Foronek, I think with unrelated entities, you wouldn't have a problem. The fact that the individual is the sole member of both LLCs makes them a controlled group and therefore treated as a single employer for pension purposes. I will have to agree with Blinky, it smells fishy (and Blinky knows about fish.) Austin, I think you need to get out more often...

The IRS are published quarterly in a revenue rulling (the latest one being 2004-92) and has rate info as far as 1987.

He can set a plan for just himself, that's not a problem. Also, you can exclude from the new plan union employees. The problem is he a member of the union, so if he excludes union employees, he would exclude himself as well. Second, Austin is correct, you have to separate union employees from non-union, not just from the ADP Test, but from your coverage and other nondiscrimination testing as well. Since the individual in question is a member of the union, separating the plans will not change anything, he will still have to aggregate this new plan with the other one, since I don't think the new plan could pass coverage on its own.

If your coverage testing group consist solely of HCEs, you're deemed to pass coverage.

Blinky, you say if the plan is able to pass coverage on its own, no TH min needed for participant in 401(k). That's not exactly correct if you have a key employee who participates in the (k) plan. It looks like they may since they do have an hourly EE who is HCE as well, my guess is he/she is related to owner, would make him/her both an HCE and key and if plans end up being TH, (k) participants would be entitled to TH min as well.

I am not sure this is smooth interval at all given the fact that the first band is 48 years. You can't have it at more than 25 or if you do, you have to consider the first band from age 25 to see if all age bands are even. In your case, the first band would be 23 years, the next one only 1 year. You're not getting out of gateway that easy...

Janet, I'm surprised Tom and Blinky missed that. You're almost right though. It's not that you can disaggregate the CBA, you have to.

I believe that you could very well determine that this is an insignificant operational failure. That would depend of course on the employer's demographics. If that part-timer is the only rank-and-file employee, you may have a hard time making that case. If there 500 employees and she is the only one affected, I would think it is insignificant and self-correct under SCP. The sponsor needs to make corrective contributions that equal the average deferral rate of her group (i.e. HCE/NHCE) for the years in questions plus the associated match. You need to adjust the coorective contribution for earnings as well.

If Bob maintains a successor plan, shouldn't he be prevented from taking a distribution and rolling it into an IRA. Why couldn't he restate his one-man K into a Simple(k)?