betheeg

I have a SH 401k with a 3% SHNEC. The groups are named as the 3 partners individually, and then 1 group as NHCE"S. They are giving the 3%SHNEC, but only one partner wants to put in a PS. Can I give him a minimal ps allocation wihtout giving an allocation to any other groups as long as I pass all other testing? I've never had this before and it just seems weird....can't wrap my head around it. Thanks for any help.

Client has Simple Ira in place now. They have made contributions during 2005. The company's fiscal year ends 8/31. Can they teminate the Simple now and start a Safe Harbor 401(k) for October 1st? Or do they have to wait until 1/1/06? Thanks for any help...

I received a call from a client regarding a welfare plan that has never filed a 5500. The effective date of the plan is approx 12-15 years ago. The plan has approx 300 participants, and it offers group life and STD. It is fully insured with the premiums being paid 100% by the employee with after tax dollars. First, any recommendations as to what to do about the years not filed? Second, what are the filing requirements? A 5500 with what schedules? and an audit report? Any help is much appreciated.

Plan alloes a loan term for 5+ years for purchase of a principal residence. Anyone ever heard of or used a 30 year term and does that qualify as "reasonable"? The examples I have found use 15 years. Thanks.

In a SEP plan, the employer has possibly left out an employee that was due a contribution for 2003. He had an extension on his taxes until aug 15, 2004. if the ee is due a contribution, i assume the contribution has to be made. but since it is after aug 15, can the employer still take a deduction on his tax return? and what is the process of making and reporting a late contribution? thanks for any help..

a terminated participant has asked me to provide her with the exact funds that the ps plan is invested in. does anyone see a potential problem with me proving that info? i am the TPA... thanks for any help...

This may be a stupid question but I have a client that owns land under his participant directed account in a ps plan. He insures this land and has just received a bill for premiums due. Does he pay the bill out of plan assets, his own pocket, or out of business? thanks for any help...

my client has a ps plan-he is 100% owner. his two sons are in school to become dentists and also working at the practice. they just became age 21 in and are eligible to participate in the plan. they are considered hce's because of attribution and are completely throwing off my testing (super integrated plan). i don't necessarily want to do an election not to participate because one or both may come to work at father's practice once they graduate. what to do? thanks for any help...

I'm sorry Tom. What I meant to ask is if owner defers 13,000 and the 1 elig nhce defers nothing, what would be the SH match requirement for that 1 employee? thanks again for all your help.

Tom- I just want to be clear. For the year 2003 there was only def & SH match. But there have been PS contributions in prior years. So there are account balances in an another employer account besides SH match. So is the plan considered not top heavy for 2003? Owner has 90% of the assets. Same plan but another subject, say in 2004 the only elig ee does not defer anything. what would be the employer SH match to that 1 employee if no ps contribution? 3%? or nothing? SH match is 100% up to 3% of comp, 50% for the next 2% of comp. thanks again for the help.

i have a SH 401(k) with basic match and that has a PS component. For 2003, if the employer only makes the mandatory match and does not do an additional PS contribution, do i have to make an additional top heavy contribution? i read this in one of my resources: With the enactment of EGTRRA, a 401(k) plan providing a safe harbor match contribution will no longer be required to provide additional employer contributions to satisfy the top-heavy minimum contribution rules so long as no other employer contributions are made to the plan. [i.R.C. § 416(g)(4)(H)] In addition, even if the exemption does not apply, matching contributions can be taken into account in determining whether an employer has satisfied its top-heavy minimum contribution obligation. [i.R.C. § 416©(2)(A)] just want to make sure i'm reading this correctly. thanks for the help.

is the interest a participant pays back on a loan deductible on tax return?

so do you suggest an attorney get involved? and again what is the procedure to report to the IRS? I have read they are lenient and will except just about any excuse....

the plan has approx. $300,000 and has been over $100,000 for years.

i have a client that has had a plan since 1980's and never filed 5500EZ (one participant). what is the procedure on reporting delinquencies to the IRS and any idea of what he's looking at for fees? does the IRS tell you the fees in advance or do you find out after you report? thanks for any help....

we have a client who is a self employed dentist with a profit sharing plan. there are also 3 eligible employees in the plan. can anyone suggest an easy way to calculate ideal salary for owner? I am going in circles....

Thanks for the info Tom!

We have a client that has a PS plan and the investments are at MFS. MFS provides quarterly statements directly to plan participants. Is it required for them to also get a statement for year end showing contribution made for that year? Obviously that info would not be on the Dec 31 MFS statement. Thanks for any help.

they do use facts and circumstances. if they choose not to have fed taxes withheld, they will still get a 1099R at end of year and have to pay taxes then, correct? thanks for your help.

i have a client that wants to allow a $1,500 hardship w/d from a 401(k) plan for an employee to purchase a vehicle. i have advised against this but my client is insisting that the hardship is that the employee needs to get to work. has anyone ever heard of this before? also, you do withhold the 20% fed tax on hardships, correct? thanks for any help...

right, but i read this in another post..... "Just to add - the top paid group election will not cause a more than 5% owner to be considered an NHCE. Since all three of your owners own atleast 10%, they will all be considered HCEs regardless of the top paid group election. " so, if i use the top paid in my situation, 4 ees.... i would have 1 hce but could i not consider daughter to be nhce because she is a more than 5% owner by attribution? thanks again...

one more thought.....if i use the top paid group election, would the daughter then be tested as an nhce? or does attribution count when figuring the more than 5% owner for top paid purposes?

thanks everyone for your help.

thank you for the reply. my next question is if i name the groups owners not by attribution and owners by attribution, can i allocate o% to the daughters group-owners by attribution? it would help me pass testing, and there's no gateway for hce's right?

does the employer have to allow for a cure period if the employee is terminated? can we make any arguement that the 1099r can be issued in 2003?