BG5150

Would there be an operational failure because people (in the end) were deferring more than the agreements they signed were for? For example, say I signed an agreement for 5% of my comp to be deferred. However, after this add'l contribution, it turns out to be 5.2?

Why not do it as a profit sharing? This way it won't be immediately 100% vested (maybe).

Nope. They are not participants until they have satisfied age and service requirements and reached the appropriate plan entry date.

We have a plan in which only the HCE's deferred, even though NHCE's were eligible. Therefore, all of the HCE (and, thus, key EE's) contribs will be returned. The plan is also top heavy. My question is: When is the rate of the key EE's determined? Before the refunds are taken? Or after? if it's after, I'm guessing no TH contrib is necessary, since the key EE allocation will be zero. (I know this is just the tip of the problem; we're tackling this first.)

The 80% still passes...no worries.

The BPD should spell out what a year of service is.

Why not send an e-mail to Relius?

Why is it 59 and a HALF? Why not just 59? Or 60? Why screw around with this half-year crap?

30 grand a pay period? I'm in the wrong business!

Where in the code does it address changing from prior year method to current (or vice versa)? Or was it a Rev Rul? Can someone point me in the right direction?

I find that the Relius helpdesk is pretty good, either over the phone or via e-mail. you have to ahve an account set up with them. The phone # for Administration is: 800-326-7235 x-1785 The wesite is: www.relius.net/support

Such an anticlimactic answer after a 471-word missive...

It sounds like there is a conflict between the SDA and the plan document (or, rather, the adoption agreement). I would say the plan docs win over the SDA.

I agree. And the plan should be amended for the year (at least) to not exclude the compensation so there is not an operational failure.

And ownership in the testing ("current") year.

Do you include receivables in the Top heavy test?

I know that former key employees are removed from the Top heavy test entirely. However, do they get added back in after 5 years of not being a key ee anymore?

If you force him out, you have to force out everyone under the threshold. You can't pick and choose to whom you will distribute.

Plus, how can you add earnings to a true-up? From which date would apply those earnings? Since the plan (we think) is using full-year comp, it doesn't have to make ANY match until after the plan year. If the plan did that, there would be no earnings calculation (provided the deposit was made timely). if you think about it, making the match at the end of the year is just one giant true-up. Making a match on a per-payroll basis just makes sense for a lot of companies. This way they don't have to write one huge check in January. So, my without a doubt, take-it-to-the-bank, I guarantee it or your money back, swear on my (insert family member here)'s grave that there is not interest calculation on true-ups. Ok, I'm not that postive, but I'm pretty sure.

415 might be an issue, tho'

But what if the participant was happy with her 3% deduction? Would she have to change it to 4% then change back to 3% to get out of that classification?

Does that run afoul of 415 testing? I thought for short plan years everything was prorated ('cept 402(g)).

The plan terminated. When the record keeper processed her distribtuion, it failed to properly offset the loan

Anyone?

Blinky should be 18. (since this is the 18th season of the Simpsons)