Bird

I'd argue that each pay period has (had) conditions (having income in the pay period), and since it is discretionary, and each future pay period's conditions have not been met, you can change whenever you want - it's impossible to go back and take away anything from those pay periods that have passed (especially since nothing was contributed!). I'm not saying it's a slam dunk, but maybe a lay-up.

I agree.

No it doesn't make sense. Your mistake was giving them the letter, which gives them an excuse to look for trouble and be difficult. Next time call them up and say "the number is xx-xxxxxxx" or put in on their form for them. I suppose in this instance, you can try to tie the name of the plan to the trust provisions that are no doubt in included in the plan (I'm assuming that there are not two separate documents). Actually, the thing to do is spit out a whole bunch of pdfs - the plan (adoption agreement), the basic plan document if applicable, the SPD, the loan policy, QDRO procedures, anything and everything you can think of that has nothing to do with anything, and say "yes, actually the 'plan' is a 'plan and trust', and these documents prove it." You can also just say "what are you gonna do about it, not take the assets?"

Yes, I would simply move the money, plus (actual) earnings. I do still wonder though, if you were thinking the company owed the plan $11,000, how you were accounting for the money that was in, but in the wrong account.

Ummm...I haven't looked at those rules in a long time and sorry, but I don't feel like doing it now. My recollection is similar to yours, that there was some other way to try to comply, but it was more trouble than it was worth. Most of my clients are very small businesses, and I do take the extra trouble to pluck the disclosure documents from the investment company websites as they are available, and I send them with instructions that they can forward by e-mail if using the computer is an integral part of their employee's job, otherwise they must send paper (and I send a paper copy as well so they can make copies, with an offer to send more hard copies for a price). Sorry to be cynical, but this particular issue for me is mostly about being able to say "I told you to do it."

They shouldn't be, but you never know how things get connected in the computers. Obviously if they are using the same tax id number, then that would be the linkage. I'd write a letter explaining that they are a monthly depositor and show evidence of the dates.

If I understand you, the money is in the plan, just not in the correct account? How are you accounting for the $11000 that is in the wrong account (or is it 5500)? If the money is in the plan but in the wrong account, we would show that money being owed/receivable, which nets to $0 on the plan's balance sheet. And we'd accrue a prorata share of the earnings and transfer the total amount to the proper account. If the money is owed to the plan as a whole, and it is safe harbor money, then I'm pretty sure you can self-correct that in the year following the year it was due.

Generally prefer Dec 31 so you don't have to file a short plan year return for Jan 1. I don't remember for sure but I think we've taken the position that a merger on Dec 31 does not impact safe harbor either way for either plan for that year, but if you want to be super-cautious, then Jan 1 is best.

If you are allocating costs like employer contributions, then you probably do it by profit percentage. But I've had weird arrangements where they split the costs one way and the profits another...you probably have to ask, and then use your judgment.

Restating/expanding on what WCC said...think of any contributions made as estimates. When you are basing things on annual pay, but contributing each payroll, you are prefunding on an estimated basis. Figure out who had the highest percentage based on annual pay, and then adjust everyone else up to that.

Thanks for the cite, I had forgotten that (and probably will again).

Yes, a participant can take the policy out of the plan after 59.5 - if the plan permits such (presumably in-service) distributions. It would be a taxable distribution. I believe the proper valuation for the policy is the Interpolated Terminal Reserve, which is provided by the insurance company.

I have always treated the premium as a purchase of an investment, and the difference between it and the end of year cash value in the first year will be an unrealized loss. I've seen it treated as an expense and the cash values don't get reported on the 5500, but don't believe that is proper.

Looks like there is a distinction between "eligible plan assets" (those with a readily determinable FMV allowing you to file an SF) and "qualifying plan assets" (those that satisfy the requirements so a plan audit is not required). There is a caution for line 6b that makes that point; reading in part: "Holding all the plan’s investments in “qualifying plan assets,” however, would not necessarily satisfy the conditions for filing the Form 5500-SF. For example, real estate held by a bank as trustee for a plan could be a qualifying plan asset for purposes of the small pension plan audit waiver conditions but it would not be an “eligible plan asset” for purposes of the plan being eligible to file the Form 5500-SF because real estate would not have a readily determinable fair market value..."

Yes and no. Some have that plugged into a system, and generate something that references 408b2 or at least seems tailored to those rules. When the rules were first effective, we contacted sponsors, generally copying the brokers, noting the importance of receiving the disclosures, otherwise, if the fiduciary didn't follow up and/or consider removing the broker for failure to disclose, the fiduciary would be considered to engage in a PT. We got a range of responses from the brokers, some supplying their basic fee schedule (as you note, under SEC regulations) which probably more-or-less complied with 408b2. And some provided us with 111 page pdf documents that referenced vague and inadequate websites and basically said "here, you asked for it, you prepare it."

Good points. I think you have to ((the sponsor has to) look at the transactions (change of service providers, restatement) as one event, and decide if it is worth it or not. Talk about whether a restatement is necessary or not under the code/regs is a distraction; I can definitely see the point if a service provider says they can't administer the plan using someone else's document; we do (use existing documents) sometimes, but it can be a pain. Ultimately, I see no problem with such expenses being paid by the plan.

FAQs are here: http://www.irs.gov/Retirement-Plans/Retirement-Plan-FAQs-Regarding-Form-8955-SSA #12 says electronic signatures are not required. I can't find anything that says specific approval to file is or is not required.

I haven't done a lot of research on this, but I think you have it right - the things that you'd want to be covered aren't. It's more about "monitoring" investments and investment-related stuff than administrative operations. They're going to spit out a bunch of reports about performance and whatnot that is of little or no value, but can be used to justify fees and, in the unlikely event of a lawsuit, show "due diligence."

Mmmm, well, I guess I'll just say that I wouldn't hesitate to amend a SH plan for a change of address. Not amending doesn't change the fact that they have a new address. Is it urgent? Not really. But I'd probably have done it by now, if it was effective in 2013. FWIW, if the address is in the adoption agreement, then I'd argue that an amendment is in fact needed.

I'd say yes. You might have to review the adoption agreement to confirm that service with members of a controlled group is counted.

Agree.

Definitely. With American Funds, they go to A shares from R-whatever, and there's no sales charge, so it's a great deal. (In case anyone doesn't know what I'm talking about, average expenses for R-2 are 1.43%, R-3 are 1.02%, and R-4 are .72%. A shares probably average around .7%.) With insurance companies, they go into variable annuities, which have higher expenses, so it's not as good a deal.

That's our default. I can't imagine not allowing a commission-free rollover of funds from a platform, and likewise wouldn't want to tell a small business owner that he had to sell and re-buy all of his securities in a brokerage account.

My understanding is that an LLP that is taxed as a partnership is not supposed to be paying W-2 wages to the partners...but it happens fairly often; accountants want their withholding done through payroll. We will include both (adjusting the K-1 for 1/2 SE tax and contributions as necessary) as long as the K-1 income is subject to self-employment taxes.

I prefer to think of them as unrelated. Yeah, if a CSP charges $100 to process a loan and keeps it, it's the same for either disclosure. But if you have a mutual fund with expenses of 1.50%, that's what is disclosed to the participants. If the broker-dealer gets 0.50% of that, that is what is disclosed to the fiduciary.