BG5150

So, for the side gig, if there is a viable plan, they could put in a profit sharing up to the 415 limit.

You do not need to be failing anything to do an 11-g amendment.

Or, in any case, can't you do an 11-g amendment to let people in early for the match for '21?

So, the prior TPA did not do the cycle 3 amendment incorrectly? If so, and the client already funded the match, doesn't that mean a mistake was made?

Well, you cannot allocate more than the 415 limit for any one year.

But I would make sure regular payments happen going forward.

And don't confuse reamortizing the loan with refinancing. They are different things.

I can count on my ten fingers (and not use all of them) the number of plans I've dealt with that allow participants to purchase life insurance. And even less experience in what to do when it comes time to distribute those policies when they terminate employment. Are there good resources that explains when needs to, or can be, done in these situations? I'm not sure if this participant wants to keep the policy or cash it out. Any ideas would be much appreciated.

I didn't mind the old way...

That. Or a revised 1099? I don't think I've ever had anyone repay anything. Remember the entire withdrawal needs to be repaid; not just the check amount.

Is this going to affect what we do? This is for State tax. Is income reduced on K-1s for state taxes? If so, I would assume that it's been reduced by the time the K gets to me. As far as I know, the subsequent calculations of plan compensation only involve the SE tax and a couple other things; but not state tax.

Another note: If the $20,000 was more than what was owed, check the loan policy. See if pre-payments are allowed for a part of the loan. We usually write our loan policies to only allow pre-payment for the whole thing. Makes administering them a heckuva lot easier. (I'm assuming that $20,000 check got put into the account to pay off some of the loan)

Box 14A. i wasn't sure if we would have to reduce THAT for the PTET.

If a 1099 wasn't issued, can't you just correct it under EPCRS? a) catch up with a lump sum payment then resume payments b) reamortize the outstanding amount c) combination of both

For a SE person, and if they are the only person benefiting in the plan, the deductible limit is really 20% of the gross income. To remember, I just use $100,000 of comp as an example. 20% is 20,000. That makes the net income $80,000. 20,000/80,000 = 25%. So max deductible is 20% of gross comp, 25% of net. So, the owner who makes $25,000 (that is not on W2, Sched C), the max is $5,000.

Do it soon. 1099's are due out in two weeks.

Do you subtract it from the gross K-1 or the net after all that other arithmetic we do? If they are S-corp, is it figured into the W2, or it is the W2 comp reduced to get the comp?

For one, if there were loan repayments withheld from a paycheck but not sent to the trust, it's a prohibited transaction, and should be corrected by the employer depositing the withheld amounts along with lost earnings. The employer also owes a 15% penalty tax on the earnings, payable with the filing of Form 5330. Optionally, the ER can file with the DOL VFCP. Also, the missed amounts must go on the form 5500 until the year of correction.

Do you need a 2848 to pay on behalf of someone? I don't think we ever got PoA.

And/or ask the software vendor how to exactly make the changes you need so nothing is overlooked

Just one bond covering 100% of the non-qualifying assets OR 10% of total plan assets, whichever is greater. (And, as we now remember, there is no $500,000 cap if/when the the nonqualifying assets are more than $500k. Or, I guess, $1MM if there employer securities involved.) Side question about the $1MM bond. If a plan has $12MM in assets, but only, like, $40,000 in employer stock, do I still need a $1MM bond?

It's everything EXCEPT rollover and voluntary after-tax.

That's what I thought. thanks.

Plan has $2MM in assets, of which $1.5MM are in non-qualifying assets (real estate and partnerships). Does the bond have to be the full $1.5MM? Or it is capped at the traditional $500,000?

Do you have some sort of compliance software? just enter the relevant information and have the computer calculator it. And is the husband the owner? You didn't say so. S-corp and the husband's comp is W-2 also? if not, the calculations are different for deductibility.