John Feldt ERPA CPC QPA

It's unclear. The PPA documents will be reviewed by the IRS, and unless the IRS says something before then, the document providers will find out once the IRS reviewers respond. I assume the providers will still place text in their document that allows a checkbox for each participant being in their own allocation rate classification.

If the original notice named the fund (or funds) for the QDIA, or stated something that is now outdated due to the change being made to switch the default fund, then I would think you should provide the an updated notice, preferrably 30 days in advance of the change.

Suppose the safe harbor plan is found to have failed some test after the plan year just ended: either 410(b) or 401(a)(4). Would an amendment under 1.401(a)(4)-11(g) be verboten because the plan is safe harbor? If you fail, no -11(g) option for SH plan: too bad, tough noogies, bah humbug? Or do we say that the 12 months are over and the provisions were in place for the whole plan year, thus making the plan now open game to be amended retroactively? Rhetorical questions only, I know, expecting a reasonable approach may be asking a bit much.

The IRS has said that a 3-year cliff and a 6-year graded vesting schedule are identical for testing purposes, but yours has immediate vesting. This would appear to be subject to BRF testing. Just curious, has the IRS ever made a case of that? The plans are aggregated for coverage, so the differing eligibility requirement does not appear to be a benefit right or feature to me. Oh, by the way, you may want to read this link: http://benefitslink.com/boards/index.php?showtopic=49421

"a plan will fail to satisfy the requirements of sections 401(k)(12), 401(k)(13), and this section unless plan provisions that satisfy the rules of this section are adopted before the first day of the plan year and remain in effect for an entire 12-month plan year." Maybe I am misunderstanding "section" - that means 1.401(k)-3, or does it mean something else? If it means 1.401(k)-3, then where in 1.401(k)-3 is the rule regarding entry dates? The light has not yet turned on for me to see this so clear yet, so I would really like some enlightening, if you can. Tower of Terror? Not as much now that Jim H is no longer there.

Yes.

I did not get to go this year :( - if i could add tears here, I would - I mean, for me it's like a disney trip to go to those sessions.

So, even though an explanation of the plan's definition of eligibility is not required as part of the safe harbor notice, a safe harbor plan cannot amend to let group of NHCEs into the plan before the beginning of the next plan year? Mid-year addition of Roth and beneficiary hardship have a green light. Mid-year change for In-Plan Roth is okay for now, but not in the future. Can the plan be amended mid-year to change the name of the plan if it's a safe harbor plan? How about the definition of "disability" - can that be changed mid-year? Can a safe harbor plan be amended mid-year to use a corporate trustee instead of individual trustees? How about an amendment mid-year to allow predecessor service for eligibility purposes? Can a SH plan be amended to change from balance forward to individual direction mid-year? Can the plan be amended mid-year to stop paying plan expenses from forfeitures to allocate instead, or to change the use of forfeitures in the next year to be in the current year? Can the SH plan be amended to allow installment payments or to remove installment payments mid-year? Can a SH plan be amended mid-year to change the one-year marriage rule to/from "not applies" from/to "applies"? Can a SH plan on a vol sub document be amended mid-year to add multiple employer language if the controlled group of employers break up mid-year? edit: typo

They are also not able to defer anymore starting 1-1-2012.

Suppose a calendar year 401(k) plan excludes non-shareholder HCEs from all contribution types. The employer does not apply the top-paid group election. Suppose an employee is hired in June of 2010 (not a shareholder) and they do not earn enough wages in 2010 to be an HCE in 2011. Suppose they enter the 401(k) plan on July 1, 2011 (after one year of service). Allocations are made to their account for 2011. Suppose they are paid enough in 2011 to be considered as an HCE in 2012. Starting January 1, 2012, they are excluded by the terms of the plan. The plan is top heavy. Are the required to receive a top heavy minimum allocation in 2012? on edit, added: Please assume this plan is not a safe harbor top heavy exempt plan.

You mean, can the employer contribute 25% of pay? You are correct that the 415 limit in play here is the 100% of pay limit. The wages, for 415 limit purposes, is something above $12,500 (since 415 does not net out FICA). Suppose his 415 wages are actually $13,110. If that's the case, the employer could contribute $610 and he's reached the 415 limit of $13,110 ($12,500 deferral plus $610 ER contrib). Then as you suggest, if he's catch-up eligible, the employer can contribute even more. The 415 limit does not include the catch-up deferrals. But, if you try making a full $5,500 into a catch-up with a $7,000 regular deferral and $6,110 an employer contribution, then you have to look out for the 404 deduction limit. 25% of overall eligible wages in the plan will limit the employer's deduction. With just one employee in the plan who makes $13,110, the employer contribution could be $3,277.50 (25% of $13,110) and the deferral of $12,500 is broken down as $9,222.50 regular deferral and $3,277.50 as catch-up, for a total allocation of $15,777.50.

1984 Social Security Taxable Wage base = $37,800 1984 415(b)(1)(A) = $90,000 (down from $136,425 in 1982) 1984 415©(1)(A) = $30,000 1984 402(g)(1) = n/a 1984 Officer comp, 416(i)(1)(A)(i) = $45,000 1987 Social Security Taxable Wage base = $43,800 1987 415(b)(1)(A) = $90,000 1987 415©(1)(A) = $30,000 1987 402(g)(1) = 7,000 1987 Officer Comp, 416(i)(1)(A)(i) = $45,000 1987 HCE, 414(q)(1)(B) and © = $75,000 and $50,000 1987 ESOP amounts, 409(o)(1)©(ii) = $500,000 and $100,000

In 1984, I think the DC dollar limit was $30,000 (down from $45,475 in 1983). In 1987, it was still $30,000 (it eventually increased in 2001 to $35,000). In 1976, the DC limit was 26,825 and it was 25,000 in 1975. However, for purposes of determining your limits under 415(e) under the transitional rule, if you contributed more than the DC maximum in 1976 and in prior years, you can ignore the amounts that were contributed in excess of the limits.

A QACA SHNEC, when contributed, might not be 100% vested (QACA allows a 2-year cliff vesting schedule). Does this mean the IRS thinks a QACA SHNEC forfeiture cannot be used to satisfy a QACA SHNEC, but instead must shift to some other type of contribution source? If so, what if there are no other contribution sources? edit: typo

Well, I'll attempt to answer my own post. I think that under the current rules (in effect today), the SPD/SMM timing applies. However, next year when the new fee disclosure rules take effect, then the disclosure must be provided before the new fee can take effect. If any others want to opine, that would be great.

Oh man, my bad. Yes, I was thinking SIMPLE IRA.

Adopting a qualified plan would invalidate the SIMPLE plan.

If you submit an application under VCP, you can propose a lot of different methods for correcting the plan. If the IRS ultimately agrees, you'll get a compliance letter that indicates they accept your method. However, under SCP, you'd be taking a risk that a later audit might find that your method is not satifactory to the auditing team. I don't think he was stating that you can always use forfeitures to fund a QNEC when correcting a plan error, but if you ask them with a VCP application, it's possible, depending on the facts and circumstances, that they may accept such a use of forfeitures.

If the SSN was stolen, not fake, and the true individual whose identity was stolen actually shows up to collect the benefits, producing the valid ID and valid Social Security card, they are not actually entitled to the benefits, are they?

The plan could adopt an amendment that says compensation (for allocation purposes) in excess of $245,000 is excluded. If it so happens that one of the employees affected by this exclusion is an NHCE (yes, that's possible), the plan would have to pass a 414(s) test, or the language could limit the exclusion so it only applies to HCEs. Generally, anything that does not favor HCEs is allowed like this (as long as it does not cut back benefits already accrued). They cannot adopt an amendment that tries to prevent the $245,000 limit from being reduced by future legislative changes. If the plan wants to adopt an amendment that integrates at a level that is lower in the future than the taxable wage base actually in effect for the year, they can do that, but the excess percent (probably now at 5.7% in your plan) would need to be reduced to a lower excess percent such as 5.4% or 4.3% etc. depending on how much below the current taxable wage base your integration level becomes. See 401(L) for details.

Submitted altogther, it should be $2,500 overall. Section 12.02 Rev. Proc. 2008-50. I don't see anything there that indicates that the fee schedule is "per failure", so one fee fixes all. Three documents to bring them all into compliance, one agent to review them, and one application fee to rule them all (and in the darkened warehouse bind them).

Yes, that is the question. Auditors generally like to reconcile the Form 1099-R's to the Form 5500 distributions.

You mean, show a distribution, and also show a rollover into the plan? I think that would be alright.

I think that's okay unless your making deferrals into a plan before the deferral option is adopted. Also, adding safe harbor to a profit sharing plan has some specific timing requirements (3 months minimum for its first year). I'm sure there's other examples like these where the last day of the year will not cut it.

How do you know that the cash balance plan satisfied 401(a)(4) without using the profit sharing balances? If that's true, okay, but it's also a rare event to have a DB/DC arrangement where the employer does not use the profit sharing to help the 401(a)(4) test for the DB plan. Just an obsevation/question. Also, how do you determine if your plan is top heavy without having the DB numbers? Are the documents coordinated so it is clear regarding which plan provides the top heavy minimum?