Calavera

Just be sure your client really has a SIMPLE plan. Sometimes they have SIMPLIFIED, i.e. SEP, and they just call it SIMPLE.

From the original post it is not clear if there are two separate line of businesses, or if Sole-Proprietorship essentially got incorporated. If it is the continuation of the same business, I would vote for $95K. If this would be a clear case of two different businesses, I would vote for $100K. Sal Tripodi in his ERISA Outline book discussed Earned Income under Important Definitions, covering the change in the form of entity during year as well. See if you have access to it for more details.

If husband was an active employee, and earned more pension benefits after divorce, new spouse may be entitled to death benefits on portion of the total husband's benefits that was earned after divorce. Knowing the employment history, and having a copy of the QDRO may help. New spouse should contact the plan sponsor and inquire in writing.

1. I believe that the plan document language, as presented, does not support giving SOB notice at all. 2. If plan will be amended to add SOB notice language, it would only apply to benefits accrued after amendment. 3. The late retirement actuarial adjustment as described, may be acceptable. However the IRS really doesn't like the "one-shot" method, and would prefer to see the "year-by-year" approach (see Sellarsian description above)

Old 404 regs supported three different ways: (1) The deductible limit determined for the plan year commencing within the taxable year, (2) The deductible limit determined for the plan year ending within the taxable year, or (3) A weighted average of alternatives (1) and (2) It appears that under the new law only second option is supported. There are no new regs yet. Some assume that when new regs will be issued, all 3 ways will be supported. Some prefer to be conservative, which in your case means that 2020 plan year contributions will be deducted in FYE 6/30/2021.

Wouldn't you use the 2019 effective interest rate for the 2019 plan year contributions and the 2020 effective interest rate for the 2020 plan year contributions?

You are right. Sorry, have no other ideas.

I recall you can change lump sum interest rates, but have to protect it for a year providing greater of. See Rev. Proc. 99-23 and prior discussion https://benefitslink.com/boards/index.php?/topic/5458-transition-to-gatt-lump-sums/

This is actully related to NRA and not NRD (see 1.411(a)-7(b)) I think it is the opposite. On NRA, a participant has to be 100% vested, but it doesn't have to get 100% of his benefit. For example NRA could be 65, NRD = Social Security Retirement Age, and an early retirement reduction would apply from NRD to NRA.

As long as plan is not a top-heavy plan, and it is not aggregated with any other plan to enable the other plan to satisfy section 401(a)(4) or 410(b).

If this is a self-employment income subject to FICA tax, they may have all kind of retirement plans. I suggest starting here: https://www.irs.gov/pub/irs-pdf/p560.pdf

Any participant, if supported by plan document, can opt-out of DB plan accruals. I am not aware of any reason why opt-out upon rehire after commencing benefits would be prohibited.

This is why it is called "shared interest". The Alternate Payee will get her benefits only when a participant retires or dies before retirement (subject to proper election). If you want to segregate the AP's benefits and allow AP to retire at earliest retirement date, you should use the Separate Interest model.

Certifications is based on the actuarial assumption of expected retirement age, and if the ERA is 64, whether they will issue the suspension of benefits notice at 62. So if your ERA is 62, certify plan as underfunded. However if your ERA is 64 and they are planning to issue the suspension of benefit notice, then certify plan as overfunded.

They should think about setting a defined benefit plan for 2019.

I just love this.

If this is a BOY valuation, the actual 2017 net income should not impact the 2017 minimum calculations that were based on the expected 2017 net income.

The application of offset should be spelled out in the DB plan document. For example, it may say to project the DC account to age 65, convert to annuity at age 65 and offset your DB benefit.

The reason I asked for the valuation date is that the beginning of the year valuation is based on the estimated 2018 W2. The fact that the actual 2018 W2 is 0 is irrelevant for the 2018 calculations. For the 2019, your 1/1/2019 Target liability would be smaller or even $0, depending on the plan design.

Is this a beginning of year valuation or end of year?

About 5 years ago during EA meeting, I discussed a “last day rule” in a cash balance plan with Carolyn Zimmerman (the IRS actuary). She said that this provision is often missed by the IRS reviewers during the determination letter process. She suggested amending the plan to remove this provision. She also suggested using the relief under IRC 7805(b) so it would be allowed to amend this provision prospectively.

I agree that defined benefit plans could not have a last day requirement. However, if you have a determination letter, just amend the plan to remove this provision on a prospective basis for 2019 and future years.

I suggest to read the plan document sections about the computation periods. It may specify that you re-start a computation period to be 12 month of employment upon rehiring only if a participant incurred 1-Year Break in Service. And if it is silent, I may still base my decision on the 1-Year Break in Service rule described in the plan document, i.e. if a participant incurred 1-Year Break in Service, treat him as a new employee for eligibility purposes.

Yes You guess your best. However, I am missing something here. If your Assets+Contributions > TL+NC, the AFTAP is over 100%, and you do not subtract credit balances. And if not, waiving the credit balances will not make AFTAP over 100% And for FTAP, why would you need it to be over 100%? When your FTAP is less than 100% the only consequences are the quarterly contributions, which you can satisfy with credit balances.

Rev. Rul. 2007-43 If a partial termination occurs on account of turnover during an applicable period, all participating employees who had a severance from employment during the period must be fully vested in their accrued benefits, to the extent funded on that date, or in the amounts credited to their accounts.