Bird

They're probably going to say it's your responsibility to pay back the loan whether you got notification or not. There isn't much leeway in determining when a loan defaults; it's all very formulaic. The maximum allowance for defaulting is the end of the quarter following the date a payment was due and not paid, so if you had an outstanding payment due before 9/30 then the default sounds legitimate to me. That doesn't mean you couldn't raise a stink about lousy communications but I don't think it's going to get you very far, sorry.

How could he work less than 1000 hours from 5/2/14 - 5/2/15 and more than 1000 from 1/1/15 - 5/2/15?

I thought we'd be good boys and girls and complete them, unless, say, a plan was terminated and it was an utter and complete waste of time (as opposed to simply a waste of time). After doing one or two, now my attitude is more that...(quoting above)...optional means "skip it." I might be in a good mood and do a few more but it's hard to see any benefit from doing it.

You can't or don't want to keep the same plan year end? I suppose you could do with different year ends and have multiple valuation dates. It's hard to imagine that the hassle and cost involved with reconciling contributions, distributions, gains and losses, etc. is worth the perceived* benefits of having all assets commingled. You're basically going from one val to four. *Odds are that the "advantage" of having the assets combined is BS. I suggest you press them to come up with a cost and they can compare it to your added costs.

We use Ft. William too and think they are great.

Thanks Belgerath, I was just starting to type exactly that. The issue (probably) becomes not one of whether the plan is legit or not, but whether a tax return needs to be filed (yes).

Agreed/sloppy writing on my part.

As far as what the bank might do with reporting, it is unlikely that they would issue a 1099-R but you really have to ask them. It all depends on how it was set up and how they operate. Other Qs are above my pay grade.

Sorry, don't know what you are asking.

I agree with Mike. It's "wrong" but not necessarily disastrous. I'd start by getting a new EIN for the plan, and submitting a W-9 with that number. They should just change the number on the account.

I'd say call your document provider to be sure, but I think the necessary effective date changes are buried in the document, and you could have them signed by Apr 30 with an effective date of Jan 1 2017. But the safest thing might be to have a Jan 1 2016 general effective date and special effective date(s) for the specific change(s) you want for 2017.

LOL, I did a double-take when I checked the date on my initial post. We have migrated a few more plans over there and are more-or-less learning how to manage the system, but it remains fraught with difficulties. The latest (actually it was a known problem for us a few years ago but I forgot) is that to upload a contribution file, you have to create a template (no big deal) but then they have to do...something...to review and approve it. And you have to finish the first one with them on the phone. Oh and the columns you see on the screen don't line up the same way as those in the template. It's like they have a slowness committee that everything passes through to make sure procedures are as slow and painful as possible.

I thought they shut it down last year...? Only one plan left but I'll check and see if we have what we need; thanks for the heads-up. I'm sure I was told that everything would migrate over but was pretty skeptical about that. Both of those companies are in the worst...2...for service. I have no idea how Ascensus stays in business other than I suppose sales. I'm fortunate enough to make decisions about who we deal with and the one plan we had was enough to convince me that nothing else goes there, period.

As noted way back by someone else, the burden of proof should be on the one making the (erroneous) claim that deferrals can't be made on comp over the limit. (Assuming the document itself does not have such a limit, which is unlikely at best but easily checked.) The question here is not one of law or regulations - the question is, who is in charge and who is being paid to do what? The original poster needs to nut up and say "you're wrong because I know more about this than you do and I say you're wrong." And if they (I'm not paying that much attention...auditor or plan sponsor or whomever "they" is) still insist, then put it in writing and note that they are violating the participant's rights to make contributions and potentially causing plan disqualification by creating some arbitrary limitation not existing in the plan document. Enough already.

If you have the ability to do it, I would do the amendment now (today) and prep a new notice (today), as I think Tom is saying. i.e. I wouldn't freak out about the 30 day rule, which is just a safe harbor (hate to use that term in this context) for the timing of the notice. But yes, you could just set up a new plan with the tiered allocation in 2016 and merge them later. I'd make it a PS-only or if I used a 401(k) document, not check the 401(k) box. I'm not sure but I think the SH restrictions would apply to any 401(k) plan of the employer.

No. That is wrong, inaccurate, inappropriate, incorrect, a misinterpretation.

Thanks for posting; I had kind of expected to hear of the prime rate increasing without having to go look for it. I agree that prime plus 1 is 4.5%. For anyone who doesn't know, the Fed doesn't actually set prime; as per their footnote, it is effectively set by banks and might vary by bank: Rate posted by a majority of top 25 (by assets in domestic offices) insured U.S.-chartered commercial banks. Prime is one of several base rates used by banks to price short-term business loans. 'tho I imagine in today's world it is uniform.

The maximum employER contribution is 25%. Deferrals, Roth or regular, can be in addition. Roth is just another kind of "deferral" (obviously a very poor description when you think about it, but I digress...) so whatever you could/would do with a regular deferral you can do with Roth or any combination of the two.

Take a deep breath, get some sleep...and let it go. Believe me, I understand, but no good will come of it. If it makes you feel better, write her a "just for the record" letter explaining why things are wrong.

While it's tempting to want the money to be taxed and subject to the 10% penalty twice, I don't think that is appropriate. You said it went into an IRA, and then came out of the IRA, so the first transaction, IMO, should be reported as it actually happened, a direct rollover, not subject to tax or penalty. The fact that it was fraudulent or otherwise inappropriate is another matter.

Working from memory, I am pretty sure there are at least some recordkeepers who will not code a distribution with the disability code under any circumstances; they leave it to the participant to report it as exempt. As noted above there is a Form 5329 for that. I imagine they will follow up and ask for proof of disability, but I doubt that they will ask for proof that the termination is "due to" the disability.

We do it as a separate document - a memorandum from the company to the trustee (usually the same person). My sense - not from anything concrete but just a sense - is that they (IRS) do not care and threw in the towel on enforcing this. I'm not saying you shouldn't do it, but something scribbled on a bar napkin might take care of it.

If it's a PSP with no MP money, J&S provisions can be amended out. There is a notification timeframe for that; don't know it offhand. (I'm assuming there are J&S provisions...if not, you don't need spousal consent. It wouldn't be the first time someone asked for it when not needed.) And, just for the record, IRA providers don't care about spousal consent. It's a plan compliance issue.

Arggh. While I really, really hate to spend any time on this, I see absolutely no upside to filing; zero, zilch, nada. There is absolutely no chance of anything "bad" happening from not filing. It's not on a radar screen, anywhere. No deduction to justify, no nothing. If you file, you invite an inquiry of some kind - harmless, except for the fact that it will take time to answer. I wake up every day just hoping to be left alone for the day, and this runs counter to that thinking.

Well...I wouldn't.