BG5150

The plan document will tell you if rollovers are disregarded for cashouts.

Eligibility for the plan should have nothing to do with the deferral election (or lack thereof) of the employee. In many 401(k) plans, if you were once eligible, you become immediately eligible again upon rehire. The document WILL address that.

Plus, what happens in the new DRO (it's not, nor ever was a QDRO) now includes something about 401(k)? Unlikely, but you never know.

Can you share the correspondence? Even privately? I interested in seeing it, for a couple reasons: 1) I'm curious, 2) to help prepare against something like this happening to my company. If shared privately, I will not further share it other than to the powers that be over here.

I thought they were going to tell everyone soon, and then start collecting the choices in the window. I guess it wasn't clear. If people are only informed on 2/9, then a 3/2 date will not work. Especially if they have been considering it longer than that.

Maybe a disgruntled ex-employee?

So, with a 2/27 date, it's over a month and a half. And you are NOT going to do the exchanges on 3/1. That's a Sunday.

We have someone who took a hardship in early October. He stopped his deferrals, but a deduction did come through for his year-end bonus. What is the correction? Someone here mentioned to just extend the suspension period one month. She said it was discussed (perhaps?) at the ASPPA EPCRS session. Any specific guidance out there on this?

If it wasn't supposed to be in there in the first place, could you use it for an expense?

If the plan document doesn't specifically exclude HCEs from either the SH or a PS, then they get it just like anyone else. An HCEs cap on PS will be determined by 415 and any non-discrimination testing that is applicable.

In reality, who ever defers 100%? Except maybe a child or spouse of an owner.

From: 1.401-1(b)(1)(ii) The plan must provide a definite predetermined formula for allocating the contributions made to the plan among the participants and for distributing the funds accumulated under the plan after a fixed number of years, the attainment of a stated age, OR upon the prior occurrence of some event such as layoff, illness, disability, retirement, death, or severance of employment. I take the "or" as just needing a specific age. In the absence of a stated age, you'd need a seasoning clause, or restrict it to an event.

This doesn't add up. if the largest amount is $0.49, the the most it could be over 5 occurrences is $2.45.

$500 Loss date: 12/1/14 Recovery date: 12/10/14 Final Date: 12/10/14 Interest: $0.37 Three months of similar late weekly deposits, total is over $6,000, (total interest about $5) but each individual interest amount rounds to zero.

Is the bounty worth having to find new employment? I mean, with only a few employees, the owner probably could narrow it down pretty quickly.

I don't think I ever spoke to anyone else about the vested percentage in my 401(k) or DB plans.

If you amend the plan, you must give an SAR to only the affected participants, right? So, the still-employed people won't need to know of it. And I would construct the amendment with something like: Those participants whose employment ended on [date] shall become 100% vested in all accounts.

I don't think it's a great idea. If the person was gone a few weeks or maybe a month or two, then there might not be a problem. What if someone was gone for a few years? They might not even remember how much they were withholding.

Why can't you exclude bonus for SH if the plan is excluding it for all purposes?

ESPO Guy: the publication cited above says: So, if it is distributed, a 1099 should be generated. BTW, the original cite is slightly incorrect. It is Rev. Rul. 2014-9, not Notice 2014-9. The latter references refunds of Zone Bonds or some such rigamarole.

I think that the withholding is optional to the taxpayer.

The CPA I work with on this said: Because the transactions are considered trades, not investments, and Because they were 1256 contracts, and Because the proceeds were ran through a business entity (an LLC in this case) Because each individual chose mark to market accounting, then: The proceeds are considered earned income, even though they are exempt from SE tax.

Why not just let it be?

Well, how else could the provision fail BRF?

BRF testing would pass, I think, as everyone has the ability to either purchase a home and/or attend college.