goldtpa

Client wants to take a COVID related loan of 100,000 and also take a $100,000 COVID related distribution. I haven't seen anything about a 100,000 loan and a 100,000 distribution. I know that the $100,000 COVID distribution limit is from all plans. But wasn't sure if that includes loans too.

According to an update I received from Transamerica,"Participants who turned age 70½ in 2019 and who did not receive their first RMD for 2019 on or before January 1, 2020 will not have to receive their first (2019) RMD or their 2020 RMD."

I use egnyte. It allows me to send people a link where they can upload a file. I can also send people a link to download forms. I can track the link to see where it was opened and what time. Cost is $8 per month for the lowest plan.

Hi. thanks for the reply. What I am saying is that Sponsor A had a 401k as a single member plan. Sponsor A switches to payroll co services. At some point the 401k assets were moved from the single member plan under A's Sponsorship to the PEO's 401k plan. There were no adoption agreements by A, since A was not a participating employer of the PEO. There were no mergers, terminations resolutions, amendments, or 5500s for A's plan. I am trying to figure out whether A can treat money that was erroneously transferred to PEO as if it were in A's plan all along. Or whether A has to go to VCP to make this correction.

Large Payroll company has both payroll services and PEO. Sponsor A signs up with payroll service in 2016. Sponsor A has its own 401k Plan. Sponsor A's 401k is mistakely moved to PEO 401k plan (don't ask me how). Sponsor's employees have been making contributions to the PEO plan since 2016. 1. I assume this is a VCP Correction under transferred assets. 2. Who makes the application for VCP. Sponsor A, PEO, or both? 3. Assuming it can be self corrected, is the money in the PEO treated as if it were in Sponsor A's 401k plan all along? Or, are the contributions and its earnings taxable as that money didnt belong in PEO plan in the first place? 4. Can the money that is wrongfully in the PEO, be moved to IRAs? Thanks in advance.

Here is a video of Mr. Portman discussing the proposed bill. https://www.youtube.com/watch?time_continue=7&v=XaJDvlbF06I The part about part time employees starts at 9:32. The Senate version of the bill, S1431 , supposedly will exempt these Long Term Part-Time Employees from non-discrim testing and top heavy. However does anyone know or heard whether they would be excluded from the Gateway Test? I can see Congress excluding them from 410(b), ADP/ACP and Top Heavy, but not from the Cross Testing and Gateway Test. Thus part-time employees may have to get a contribution just to pass Cross Testing or Gateway. The other question is why does this only apply to DC plans? Why not DB Plans? I guess employers with PT employees will have to switch to a DBP avoid giving money to PT ees.

You say this plan is a ROBS plan but it has no assets. In order to have a ROBS plan, the 401k has to own some stock of the corporation. You state the business is losing money or realizing less than 10K profit/year. However revenue, or lack thereof, is not the basis of whether a 5500 is required. The 401k has to own a percentage of the corporation and that corporation has to have a value. As ESOP Guy said, It might not be worth very much but it has to have some value.

Thanks for the comments.

On a client who terminates and switches TPA, I am curious as to how many TPAs are charging a deconversion fee or a fee to send copies of prior documents to new TPA.

I had a similar situation. We filed a 5500 for a client. The client then had their former payroll company file a 5500. The 5500 filed by the payroll company did not amend the 5500 that I prepared, it was just a duplicate filing. I called FT Williams and they told me that the DOL would take the last 5500 filed and disregard the 5500s filed before. Hope that helps.

When a 401k generates profits from a business, the net income is subject to payment of tax just like a business outside the 401k to put it on the same playing field as a regular tax-paying entity. So, for example, a 401k that generates net income from investing in a retail store will be subject to UBIT because the retail store is considered an operating company.

Just my two cents here and it is nothing you haven't heard already from others. I have spent over 26 years learning what I need to know to do this job properly; and I am still learning. We all come together on this board because we all recognize that we don't know everything. We ask questions of each other for special circumstances that we come across. We are all competitors, but we all help each other anyway, because the 400 Section of the code is complex. I feel old when I say that, "back in my day the 1994 401k Pension answer book was only 7 chapters." The 2011 version is 22 chapters. (Yes I still have the 1994 edition. Don't ask why.) But to start a TPA business with no prior experience is not a good idea. That is not meant to be mean, but constructive. I doubt very highly, that if I passed my CPA exam or EA exam, you would recommend that I start a tax practice. You would probably point to my lack of experience in taxes and highlight your years of experience. That being said, like every one else here; go hire a QKA to work for you or buy a TPA practice.

Why is it that every President since Bush wants to get rid of 401ks? First it was Bush with his LSA, RSA, and ERSA Plan. Then Obama and his Retirement Annuities. Now its Trump who wants tax S Corporations, REITs, RICs and small business limited liability corporations at a 15% tax. However retirement plan distributions would be taxed at 35%.

Several States now have their own version of FMLA. If an employer is too small to follow Federal FMLA but large enough to follow the state version, what is the general consensus on Break In Service for the State version of FMLA? I called FT William, their response was that one could make a case in either direction and it would depend on who is auditing. The DOL may point to state law while the iRS may only look to Federal law. What is the general consensus? Do you prevent a Break based on state law or say that ERISA law trumps state law.

BG 5150. who else would do that? The client.

I don't disagree with ETA either. RBG they were not eligible for an EZ filing as they had 10 employees at the end of the 2012 year. Essentially what this comes down to is whether the plan falsely filed a 5500 EZ and whether they can still use DFVC; even after filing the EZ and getting the penalty letter. RBG I am going to follow your advice and get a POA. Thanks.

They filed a 2012 SF with 10 employees at the end of the year and with assets at the end of the year. In 2013, the plan was terminated and the money disbursed. However a 2013 5500 was not done. After the IRS sent them a notice stating that the IRS did not have a 5500 for 2013, they filed a 2013 EZ while dating it in 2015. Obviously they are not allowed to file an EZ for 2013. Why the EZ showed all zeros is also a mystery. However, the question is, whether the appropriate SF can be filed now, through the DFVC, even after an EZ was filed with the IRS and a penalty imposed. If a 5500 was never filed, I would say that a 5500 could now be filed with the DFVC. However since a 5500 was filed in 2015 for the 2013 plan year, I am concerned that the IRS may look at this as a false filing and impose larger fines and penalties.

Lou They filed an SF in 2012. Never filed 2013. After receiving the IRS notice stating that a 2013 5500 was not not received, they filed a 5500-EZ showing no assets and no employees at the beginning and ending of the year. They used the 2013 form and signed it in 15. The question is, do you ........ 1. ask IRS for a reduction in the penalty 2. amend the 5500-EZ filing to an SF. Fill in the appropriate info and ask for a reduction. 3. Try to file through DFVC (which I don't think you can do since a form has already been filed and filed late)

Company with 10 employees fails to file a final 5500 in 2013. In 2015 they receive letter from IRS stating the 2013 5500 was not received. Company responds to IRS by sending IRS a 2013 5500 EZ, signed and dated in 2015. The 2013 5500 shows $0 for the beginning of the year assets and 0 employees in the beginning of the year. Company gets letter from IRS assesing $15,000 penalty. I was going to amend the erroneously filed 5500 and ask IRS to reduce the penalty to $750. Thoughts? Thanks in advance.

I saw that the 2015 5500-EZ was looking for similar info. I had a suspicion that they would add it to the SF. What is the consensus, are you going to leave it blank as its not mandatory? Or are you going to answer the questions anyway?

Have a client that has signed up with a PEO. They are transferring their single employer 401k to the PEO's multiple employer plan. As this is my first PEO transfer, what paperwork is required? Is there some type of amendment that is required? Thanks in advance.

In the draft version of the 2015 Form 5500, question 13 has been added to find out if the plan has been timely amended for all required tax law changes. Then the questions b, c, and d are asking for the date of the amendments and the serial numbers of the prototypes or vol submitters. Does anyone know if the 2015 SF will be asking for same?

No! A recordkeeper's QDRO-review service is not worthwhile. Recordkeepers can only tell you whether a DRO would qualify as a QDRO. However they cant tell you whether the DRO meets all of the requirements of the Plan's QDRO Procedures. Recordkeepers have their own QDRO Procedures which are never communicated to employees and may be different than the Plan's QDRO Procedures.

Have a client that has Collateralized Securities in their 401k plan. Is this allowed? Thanks in advance.

Have a distribution due to death in a 401k. The bene is a trust. Due you withhold 20%? If so who gets credit for the withholding the decedent or the trust? Thanks.