BG5150

I'm still trying to figure out how/why access to an investment platform within a plan can be contingent on something, anything outside the plan.

An EACA plan must be for a full-year, I thought.

Hey, folks. You can get a self-directed brokerage account if you open up an account with the ABC Financial Services Company. What a deal! Hey, folks. You can get a self-directed brokerage account if you buy a Ford F-150 from City Ford. What a deal! Where does it end?

When was the distribution done? Could the participant apply for a 60-day waiver for rollover? I'm not sure how long that process takes, but I would think "Let's get this into an IRA ASAP." The problem then becomes, who makes up the missing 20%? Perhaps a "loan" from the ER tot he participant, because if the ER simply makes up the lost withholding, the PP will get a windfall come tax time. Then, you'd just figure out lost earnings somehow. Does the PP have another IRA? Perhaps mimic the returns from there. If the waiver gets denied, then you start looking at long-term ramifications.

Isn't there some other remedy than disqualification of the plan? Seems a rather heavy-handed consequence for one operational error.

Can't you just do a garden variety amendment to allow it?

More like 5500-how-you-doin

How many people are we talking about?

How long was this going on?

As far as I know, my plan is NOT a MEWA, and it seems that it doesn’t have to file an M-1. However, the instructions for the 5500 (p. 18) say to attach a statement of compliance. Item 1: whether or not the plan is subject to an M-1 filing (no?) Item 2: if item 1 was yes… (N/A) Item 3: asks for a confirmation code. If the plan is not subject to M-1, then they want the most recent confirmation code. Is item #3 also contingent on answering #1 “yes”?

You are subject to the RMD rules for the calendar year in which you turn 70 1/2. If a distribution is done in that year, but before the participant turns 70 1/2, then you still have to take the RMD first. I think you have an ineligible rollover to the the DB plan and the RMD money has to be returned to the plan to be paid out as an RMD.

FWIW: if using VCP for only a loan, the fee is cut in half

It's certainly not a MEWA. So, you are saying I have to submit an attachment anyway?

never mind. It had something to do with the M-1 filing and it was in the instructions, not an ASAP. Doesn't apply in this case anyway.

From the EPCRS section dealing with correction of loan defaults: (emphasis mine) Sec. 6.07

I'm filing a 2013 Welfare Benefit plan. Were there any changes for 2013? Someone in my office seems to remember and ASPPA ASAP about it, but I cannot find it. Your thoughts are appreciated.

yes. the DOL calculaor does a good job on the interest and the interest on the interest.

I would think you could get by, like John said, by job classification. To me, it's a valid business classification.

Here is my Safe Harbor Match calc spreadsheet. Someone in the forums gave me the formula, I think. You can modify it to your formula. Safe Harbor Match Calc.xlsx

Like many things here, the plan document often has the answer. How does the plan define a Year of Service?

True. So, scratch my response. I had a client that WAS a 1-man plan, but he hired someone and that made us put the plan on the regular 5500 (because of non-qualifying assets).

If the collectibles are more than 5% of the assets, I think he has to file an regular 5500, too. With proper bonding, of course!

I have a plan that had deferrals taken from an ineligible compensation (overtime). One correction under consideration is refunding the overages (plus investment experience). This would be considered an excess deferral. This happened in 2013. If not an excess deferral, what correction is it then? It's either an excess deferral (as defined by the code or a plan limit) or what? We were thinking of being aggressive going down the "ineligible participant" route, in that deferrals were taken from an ineligible source of income. This would allow us to forfeit the contributions and make the participants whole outside the plan and also avoid the onerous tax consequences. Some people in my office just think we should correct moving forward, let the participants know what happened and move on. I'd like to self-correct, as this plan has over 1,000 people and the cost of VCP is 15,000 just to submit. This affects 80 out of 1200-1300 active participants, and the amount in involved is miniscule compared to total deferrals.

Lou, What correction is it then? It's either an excess deferral (as defined by the code or a plan limit) or what? We were thinking of being aggressive going down the "ineligible participant" route, in that deferrals were taken from an ineligible source of income. Some people in my office just think we should correct moving forward, let the participants know what happened and move on. (I'm going to copy this into the Plan Corrections Forum to properly place it.)

I have a plan that had deferrals taken from an ineligible compensation (overtime). One correction under consideration is refunding the overages (plus investment experience). This would be considered an excess deferral. This happened in 2013. Because we are past April 15, how is the distribution taxed? Is it earnings in 2014 and excess in 2013 AND 2014? Or did things change and everything is taxable in 2014?