Bird

I agree (I don't think it will work).

I think you have to ask specifically for "Self-employment earnings" and not let them make you guess. Schedule SE says to use K-1, Box 14, Code A when calculating SE tax, so that should be it, but I've seen different accountants report it differently (and the same accountants report differently year-to-year!).

Yes. We submitted a plan for a termination DL that had received a waiver of the 5307 fee on adoption and they pointed out that it was (still) eligible for the waiver.

You're right. I would do him a favor and tell him in no uncertain terms that he needs to pay himself "reasonable" comp and that just because his bookkeeper says to do it this way doesn't make it ok. He's asking for serious trouble.

Agree, it's an expense. Probably widely misreported, especially if it takes extra effort to find.

First thing to check is the codes on the 1099s, especially the one from Washington Mutual. It sounds to me like Fidelity did the right thing (maybe the first time I've said that!). Washington Mutual's should be coded so that $1,500 is not taxable. If not, either he didn't ask for the money properly or they messed up. I don't think it's uncommon for someone in that situation to say "just gimme the money; they tell me I have to take it out" and have a "regular" distribution processed.

I think you have to wait until you know the numbers. Being defensive, I'd start laying (or deflecting) blame now

I think you're right.

To the original question - when you say "fixed annuity 401(k)s," do you mean that the plan only offers fixed options, or that it's called a fixed annuity 401(k) but it does offer mutual funds or other options that are truly "variable?" If it only offers fixed options, then clearly, it is a very limited platform. If it offers variable options but is still called fixed, then it probably doesn't matter. To the rest of the discussion - my two cents: -I agree that insurance/annuity products are typically more expensive, given similar features and broker comp. I find insurance companies to be inefficient and otherwise bloated and it's reflected in their pricing. -While commissions on an insurance/annuity based product may be higher in the first year, actual costs to the plan are typically level, as a percentage of assets. (Unless we're talking about actual whole life insurance and not annuities.) So I have to disagree with the two statements made about higher first year costs. -Having said that, I think more and more platforms use level (i.e. asset based or trail-only) compensation with no up-front commissions, including insurance/annuity products. -An insurance/annuity product can be made to be less expensive than an alternative simply by reducing broker comp. But all things being equal, I think the insurance company product will typically be more expensive; see above. -Mutual fund companies offer platforms with commissions that vary by share class, and should be competitive with RIA-type pricing if the comp is similar. FWIW

No, dual entry not required. "Back in the day" before 401(k)s ruled, we had quite a few plans with 2 year eligibility and nearest Jan 1 (or first day of the fiscal year) entry. And as J Simmons notes, we measured eligibility on what I call the "employment year" - i.e. from date of hire, not switching to the plan year after the first year.

Generally, yes. I might worry less about a pure change of name, since it's really the same sponsor, but I would eventually change it. For a change of entity, you really need an amendment because...it's a new entity/sponsor.

Yes, deferrals should be included. No, the CPA should not be looking at that line for deductions.

In other words, the desired result in this instance is not to correct a problem, but to conclude that there is no problem.

That sounds right. Usually we're working the other way though.

I agree with Below Ground, and especially the part about after the last contribution is due...could be 9 1/2 or even 10 1/2 months after the end of the year for employer contributions. In certain circumstances we might pay someone before that and then pay them again, but we'd rather not. There's no hard and fast time frame.

To be honest I don't know, but if you're looking for gut opinions I'd say don't report it at all. I'll also comment that I didn't know you could do this, and researched it a bit, and for the benefit of anyone else reading this, note that the annuity contract must have provisions to begin payments by 70 1/2 (to avoid an end run around RMDs).

Using an EIN on an investment account will not keep it alive. IRS reporting is what keeps it alive (945 or 1099-R...actually, it may only be withholding [945]; I'm not sure). You just have to get an EIN for the business if it sponsors a plan. If the plan is opening a regular brokerage or similar account, I will always get an EIN for the plan. If it's going to use a platform, then maybe not, but even then, we're probably going to get one anyway.

They're not in the test.

PA definitely does not give a deduction. I don't know about others.

A plan imposed limit of 0% makes me uncomfortable too, FWIW. BG5150, you're right that maximizing deferrals is safer in terms of assuring test passing w/min er contributions for the employees. But it might not matter.

Permanent

I assume it's a GUST document, and yes, it's ok. But your EGTRRA document will have to specify if you will or won't.

QPA, eh? Check out the ASPPA asap 08-42 on 401(k) deadlines; employer due dates are in it. Yes, partnerships got pushed up to 9/15.

It works. To be precise, it's determined to be a catch-up AFTER the $49,000 'er contribution is allocated (unless you go with a plan imposed limit, as suggested, but I don't think it's necessary).

OK, I think that works. I thought you were saying something else.