four01kman

Andy, I've been using Log Me In for several years and have found the service and suport to be excellent.

Austin, without looking, if it is not required in the initial disclosure, then it must be required in the quarterly disclosure.

I seem to remember a correction method allowing the QNEC to go to 1 or more NHCEs, instead of all. Since I haven't had a correction for a client in a number of years, I suspect the government probably doesn't allow it anymore.

Electronic distribution certainly helps. The issue of course is getting individual emails from each eligible participant.

I always have calculated the employer match by dividing the employee's 401k contributions for the period by the employee's pay for the period to two decimals. I'm not sure why I have been doing it that way, but I would appreciate comments.

Austin, if you are the covered service provider, I think you must explain all compensation received. Remember, your client is going to review the information you send to determine if they should continue to retain you.

Generally, you cannot choose whether to add or not include employee contributions and/or matching contributions. 1.401(m)-2(a)(3) Determination of ACR—(i) General rule. The ACR of an eligible employee for the plan year or applicable year is the sum of the employee contributions and matching contributions taken into account with respect to such employee (determined under the rules of paragraphs (a)(4) and (5) of this section), and the qualified nonelective and elective contributions taken into account under paragraph (a)(6) of this section for the year, divided by the employee’s compensation taken into account for the year. The ACR is calculated to the nearest hundredth of a percentage point. If no employee contributions, matching contributions, elective contributions, or qualified nonelective contributions are taken into account under this section with respect to an eligible employee for the year, the ACR of the employee is zero.

I can just picture the disclosure documents for the 100+ investment options, the size of a small (or maybe not so small) book. Also I can picture the cost of putting it together and then the cost of distribution. The client might, just might, change the amount of options knowing the cost of all this, and then again, maybe not.

The issue presented was after the 401k plan is terminated, what limitations were there on the amount of a loan from the defined benefit plan. I will repeat my answer: generally participant loans are not available in defined benefit plans.

Loans generally are not allowed under defined benefit plans. (:

I generally think you will not be able to provide advice to the participant. You would be using your fiduciary status to get to the employees (if you were not providing the advice, you would not know the employees).

I certainly think the fund provider would be able to help you on this; either with specifics for each plan, or a "hotlink" from the employer's website. Of course, the fund provider won't have all the information; you probably will have to supplement. Don't you love the new rules?

As I recall, the employee for whom the policies have been issued also needs to receive a 1099 each year reflecting the PS 58 term costs.

Isn't it possible to simply enter into employment agreements with these people, spelling out whatever special deal is desired?

I seem to recall the Service or DOL issued procedures on precisely this kind of issue. Something like the amount of the loan and accrued interest is treated as a "distribution" for income tax purposes for the year in which the loan became defaulted. Sorry I don't have the precise cite.

I've had mine for about 25 of the 30 years, guess I'm a member of a cult also

I suppose having the son work "less than full-time" is not an option.

I have been using the 2 form approach for over 15 years. Only recently though has the "subject to further election(s)" been added to the investment election form.

I believe it is the Plan Sponsor who is responsible for providing the notice. That said, many recordkeepers/administrators provide the notice as part of their service agreement. I would check to see who has agreed to do what services for what appropriate compensation.

Rather than trying to deal with monolithic firms like MSSB who are reluctant to embrace change, look for another custodian. I have been working with T. D. Ameritrade for many years, and although they have their quirks, they seem to be more willing to do the right thing for their advisors and clients.

Sieve, your recollection is the same as mine. Trust is required to be in existence before Plan Year End, but Trust is not required to be funded. I always was under the impression the governing body (Board) had to approve the adoption of the Plan by Plan Year End, and the major plan provisions had to be communicated to employees.

"- The 401(k) funds are managed through a third-party administrator and investments are self-directed. - The Profit Sharing funds are managed through a third-party securities broker who invests on behalf of participants." Generally speaking, gains and losses are allocated on a pro rata basis as follows: beginning balance plus (or minus) some portion of contributions made during the year. Loans do not bring a participant's account balance to zero. A loan remains an asset of the participant's account. So ... there may be some "liability(?)" to the third-party administrator. Certainly I would engage the services of an appropriate ERISA practitioner to go forth on these issues.

Pooled. That is one of the many reasons we went to individual accounts years ago.

See if the following link helps you out: http://www.401kfocus.com/leasedees.htm

Entrepeneuer.com says: Leased Employees Definition: Workers who are officially employed by a professional employer organization, which is responsible for overseeing all HR-related functions, but who actually perform all work for your company Employee leasing is a contractual arrangement in which the leasing company, also known as a professional employer organization (PEO), is the official employer. Employment responsibilities are typically shared between the leasing company and the business owner (you, in this case). You retain essential management control over the work performed by the employees. The leasing company, meanwhile, assumes responsibility for work such as reporting wages and employment taxes. Your main responsibility is writing a check to the leasing company to cover the payroll, taxes, benefits and administrative fees. The PEO does the rest.