BG5150

I thought you HAD to test the union EEs separately.

There are other partners to total 100%. He's listed as VP, too.

But EPCRS seems to say that after 4/15, the deferrals must be refunded (if they contravene 401(a)(30)). So in summary, after 4/15: Excess in one plan, must distribute per EPCRS. Excess in one or more plans, cannot take until distributable event. Is that correct?

Is it the insurance person asking? I don't know the intricacies of these things. I could picture (rightly or wrongly) that each bond could say it covers the first $x of a loss. So if you have two $20,000 bonds that say that, and you incur a $30,000 loss, might only $20k really be covered? And why get two bonds? I'm sure one for the entire amount would be cheaper than two smaller ones...

But the plan risks disqualification if they don't remove the excess timely after 4/15, so the administrator MUST refund the excess. But, if the excess is due to contributions to two plans, it CAN stay there until they take their money, right?

I don't think so.

I would ask the insurance company. Are the polices consecutive or concurrent?

EPCRS gives a correction for "[f]ailure to distribute elective deferrals in excess of the §402(g) limit (in contravention of §401(a)(30))." 401(a)30 just points to 402(g). Can there be excess 402(g) deferrals NOT in contravention of 401(a)30? And also, the plan MUST remove the 402(g) excess (in contravention of 401()(30)), or the plan risks disqualification. I seem to remember if the excess deferrals were there after April 15, you didn't do anything until the participant took their money (year?) later. And I read that if the excess deferrals are NOT in contravention of 401(a)(30), then the deferrals HAVE to stay there until there is a distributable even. Again, under what circumstances would that be?

On the client's census, they tell us that Jim owned 2.5% of the company last year (S Corp), and belonged to the Union. He made $121k in 2020. This year (2021) however, they tell us he owns 6% and is still in the union. Now he's an HCE for 2021. He's the only union person that defers (there's only one other). So the ADP test is failing. I thought I remember reading somewhere that a person cannot be an owner and a member of the union at the same time. How can someone be part of management and be a union employee? If that's true, how is it handled?

It's a 403(b) plan. Not really "profit sharing". UPDATE: they paid him the $7 in earnings.

Nate, you da man! It was there in the deferral section. Thanks!

No one? A solution floated was not doing a waiver, but just excluding people who are at risk of losing SSI benefits from the PS allocation. ADP test and coverage is fine, so neither test will be affected materially.

Is there even a nondiscrimination test for fees? I believe too many people think, "oh, it's only negatively affecting the owner or HCE's, so the DOL will be ok with it."

Do you get credit for the gross or net amount you bill? I worked at a place where your bonus was partially calculated on your billings for that year. It was based on the gross amount in our shop, but freebies were always scrutinized, so you couldn't bill $100,000 gross, but have a $75,000 net.

that said, i looked through our BPD and I only see that the administration fees can be paid against the trust. Nothing about specific apportionment that I can see.

What provision in the plan allows him to do that? Do any of the underlying documents say the plan administrator can pick and choose the accounts the fees come from?

Old job: we would charge for any amendment. It wasn't too much as to prohibit someone from making a change. It's time and effort, after all. New job: many clients have a document maintenance fee. They get all required amendments on the house (with the exception of the very first one we do for them--new plan or takeover). And they get one "free" discretionary amendment per year. Side note: Datair docs have an add/remove trustee resolution already premade. We made use of it often.

I thought some people discussed this a while ago. But can a plan allow for people to waive their PS (and SH) contributions due to the resource limit for SSI disability benefits?

Plan utilizes Fail Safe provision for coverage (so no ABT, here). Plan (just) fails coverage for the match by three people. The plan document says who the plan needs to cover, but it does not say what benefit these people must get. Unlike a non-elective contribution failure, a match benefit would seem to be based on deferrals. Often, the people not benefitting don't ahve any deferrals. So, does the ER give them some sort of QMAC? To what level? The groups ACP? (ACP including voluntary after tax? yes, it's still a thing!) I'm sure I've seen the answer somewhere before, but it's been many years since I've had a plan fail the match portion of the plan.

I would ask under what authority this is allowed. These are not excess contributions being removed to a suspense account. These are not non-vested funds being moved to the forfeiture account. The funds are not being used to offset a fee. This reeks of outright theft from the participant.

I've heard that we are supposed to go by the check date to determine if a refund is "late" or not. For example, if a refund is processed March 15, but the check date is March 16, then it's considered late and the penalties apply. Do the IRS folks really look at the check register? Wouldn't they use a transaction report that shows the distribution was done on 3/15? has anyone ever been dinged on that? What if it's an ACH that doesn't happen for two or three days? There is no check register to, pardon the pun, check.

I see now. Thx for the clarification

is that backward? How could the seller grant service with someone else? If I sold my business you you and you took the employees, how could I grant service while they are working with you...

From the client: We recently awarded a trip to Jamaica through a raffle drawing for employees that elected to make contributions to AFSAPAC. This trip is taxable to the employee. We currently have a TFB (fringe benefits code) that we use for car allowances through payroll. This code taxes them on the income but does not pay them a net amount in their paycheck. For the annual 401k audit, we exclude this TFB amount from their gross income. Can we use this code for the trip as well? Document specifically excludes "taxable fringe Benefit for car allowance" from compensation and that's it. So, to me, that means this "income" is subject to 401(k) deduction. But how do they deduct for it?

One company in a CG got sold. The new ER does not have a plan, nor does it want one. What happens to the folks in the old ER who were in the plan? Numbers-wise, this is not a partial plan term--6 participants out of about 85. So, do these people have to be 100% vested? I would think not, but just want to make sure.