Bird

Just to clarify my position, opening a bank account in the name of the plan is fine...except for the (at least potential) hassle factor. There's the issue of setting it up right, getting info on it, getting money from it when needed, etc. If possible I'd want to eliminate that potential for screwup.

Absolutely/thanks for the cite.

I don't think it would be allowed. They got rid of the notice (IMO) to save on paperwork/hassles, not to liberalize rules. Think of it as a PS allocation where there are no hours requirements; you can't change anything that would change the allocation once you are into the year. All of this assumes the SH is hard coded into the plan. Although, if it is not hard coded, I think the only thing you can do is elect or not elect it, not change definitions. Having said all that, I don't see how you could exclude bonuses from SH comp anyway.

I do but only a couple and haven't looked at the form. I (probably) would use it and don't see an issue

Here's an idea for those who run into this problem (of wanting to throw money into a platform plan but not being able or wanting to allocate it, and they don't allow an "unallocated" account) - create a dummy participant with a dummy SSN and make profit sharing contributions to that participant. When desired, forfeit them and allocate as desired. I doubt I'm the first person to think of it but nevertheless was quite proud of myself for thinking of a way to outwit these rigid platforms.

That's how I see it. There may be some problems with the more obnoxious recordkeepers but most seem to be allowing either opting in or opting out.

That's just looking for trouble. No way are they saying "here you can do all this stuff" and then pull a Catch-22 like that. exactly Agree, I can come up with that number but not that date. BTW, does anyone write loans that are issued on Jan 1 with due dates on the last day of each month (not the first day?).

Without looking it up, isn't there something in the regs about giving notice asap if 30 days is not practical? No one can possibly complain if you give the fee disclosure with the loan application. Anyway, I would do it without hesitation.

I think you have to look at your loan policy very carefully, and consider what amendments to the plan and the policy you will be making. I'd be inclined to offset the loan and just be careful to sync that action with the documents.

Generally speaking, your contributions will be 5% of each pay* if your enrollment election is 5%. It's unlikely your form/system says x% of "annual" compensation. *Just to make it interesting, if/when you get another bonus, that may or may not be considered "pay" - plans can exclude bonuses from compensation. The answer should be in your Summary Plan Description.

I agree. Someone, too clever by half, applied the logic from KETRA in IRS Notice 05-92 to this situation and now it is "all over the place." The difference is, the suspension period for KETRA was actually more than one year (8/25/2005 - 12/31/2006), so the safe harbor language in the notice effectively extended the "one year" to 12/31/2006 no matter what. Here the suspension period is less than one year and (I think) there is no way they are going to do the same thing - make loan payments due sooner than otherwise required. Sigh. RBG (just) beat me to it. "I agree with RBG."

You could be right, I don't really know for sure but I'm not convinced. As Peter noted, there might be a practical aspect to this that would make a payment to the estate difficult at best, and if it's not a huge amount, would be inclined to do the easier thing.

I'd pay it to the beneficiary if there is one. I don't see why the reason for the distribution makes a difference as to where it is paid. And I'd use Code E. Obviously they didn't contemplate the situation so you just do what is reasonable.

Another thought for the original poster - sometimes the enrollment form has to go to two places. So, if it has both deferral elections (i.e. how much you want to contribute) and investment elections (where you want the money to be invested) it needs to go to the employer so they can enter the deferral election into the payroll system, AND it has to go to the investment provider so they can set up the investment account properly. SOMETIMES sending the form to one place will get everything done, but not necessarily. It could very well be that you (or someone who didn't know any better) sent the form to the investment provider but the employer never saw it. In that case you might just say "lesson learned" and start now - I don't see any fault on the part of the employer. There are multiple parties involved, sometimes wearing different hats but sometimes one wears multiple hats: your employer, the payroll company, an investment provider (that may also be providing "recordkeeping" and/or third party administration services) and perhaps a third party administrator. I'd submit that the combination of a small employer (that doesn't necessarily know what they are doing) and a large investment provider (that doesn't have the time or inclination to look at a form and say "mmm, I wonder if this went to the employer) is a recipe for this kind of error.

Suggest you un-assume and ask what they are doing.

I agree with the concept. I think it would be acceptable, and perhaps more appropriate, to compound the interest so the new balance would be slightly higher. For me it will be easier to just plug 0's into a spreadsheet for the payments not made (effectively compounding the interest) and come up with the new balance. Nobody's going to quibble either way though. You're definitely not supposed to be adding the missed principal and interest. I'm pretty sure they would do it they way I described, by plugging 0's into an amortization schedule and coming up with a new balance. I don't think it matters what they would do...what matters is how recordkeepers will handle it, at least if the plan is record-kept.

This is what we use; some of us are short-winded ?. We prepare it for the client to sign and fax in. I gave the link to the IRS website above with fax numbers. Dear IRS: Please be advised of the following change of address for an existing tax ID number: Tax ID number: xx-xxxxxx Name: XYZg, Inc. Profit Sharing Plan New address: xx Avenue City, State, ZIP Please adjust your records accordingly. Sincerely, (Trustee)

I agree. Anyone who wants to ignore such posts is free to do so.

It's not like I really followed this but concluding that this somehow affects participants' W-2s does not make any sense at all to me. The whole post is incoherent; sorry, but while you probably didn't want to waste any more time on a black hole all I have is a vague idea that someone put money into a plan that they didn't intend to, took it out, and participant's accounts were affected. This is the accountant's client that you are now calling your prospect? Was the entire "profit sharing" piece pulled out? What do you mean by "reallocated" - were the monies not deposited by source?

I believe it applies to new loans and would write them as usual - payments due as normal as far as setting it up but with the understanding that those payments may be deferred and the whole thing reamortized later.

2202(b)(2)(B) any subsequent repayments with respect to any such loan shall be appropriately adjusted to reflect the delay in the due date under subparagraph (A) and any interest accruing during such delay I think the word "and" italicized above has critical meaning here. Subsequent payments are adjusted (by pushing everything forward, IMO), AND the interest accrued is considered when reamortizing. I dunno, maybe I'm not paying close enough attention and don't know what we are disputing, but I know how I'm handling it.

I may be guilty of thinking logically, and usually am cautious about that. But if we're asking how we get to conclusions, how do you conclude that the appropriate adjustments only refer to interest and not timing...?

https://benefitslink.com/boards/index.php?/topic/65818-covid-19-withdrawal/

I wasn't paying much attention (and sorta wished I hadn't) but there is no doubt in my mind that the text "any subsequent repayments with respect to any such loan shall be appropriately adjusted to reflect the delay in the due date under subparagraph (A)..." means...just that. A payment due Jan 15 2021 may be deferred, as may one due Jan 15 2022, etc. I agree with C.B. Zeller on all counts. The loan will be reamortized when the participant wishes, but not later than one year hence. And I agree the changes in the payments are pretty small.

I'm not sure why you would have used that EIN on the 5500; that is supposed to be the sponsor's EIN. Setting that aside, there is a procedure/instructions for changing info on a filed ein application; see below. I'm not sure if it is too late for that though; maybe worth a try. I think you could just say "sorry you can't efile" and a paper filing would not have that problem. I guess if the taxes were accepted you don't have the problem of the ein being deactivated which is whole 'nother problem. http://www.employeridentificationnumber.net/how-to-correct-information-on-a-filed-ein-application.html