BG5150

I just wan to make sure I'm getting this right. I have restatements on the brain, and I'm having trouble shifting gears lately. Husband and wife plan, husband owns 100%. Assets over $250k. 2020 divorce is final. QDRO effective 10/1/2021. (shouldn't matter) Filed an EZ for 2020. What about 2021? Is the plan now subject to ERISA since it no longer only covers husband and wife? Pooled account, non-traditional assets, so they have to get a bond for 100% of those assets. Side note: If a plan covers the owner who is still working and a spouse who no longer works for the company, is it still a one-participant plan? I just found out she left employment in 2016.

What if the asset is a painting. It's valued at $10,000. It's the only thing I was invested in. I cannot sell 20% of a painting.

My point is that participants SHOULD be able to rely on the IRS website for that information. Same with retirement plan professionals. Sometimes we have questions. Unfortunately, I've learned not to trust the IRS site.

Not true. In addition to what Bird said, I cannot tell you how many times these sole proprietors, on the advice of accountants or financial advisers, just chunk the entire 415 limit in every year. Then it turns out, they do not have the income to support the contributions. Or, if they are over 50, the contribute the 415 maximum plus a catch-up, but there is no 401(k) component. Or, they take a 'loan' at some point during the year with no paperwork or regard to limits or whatnot. Or take distributions, allowed or not, and don't tell us, and no 1099-R was ever done. Is the administration of a one-participant plan less, or even much less, than a plan with more participants? Sure. But the work should be greater than 'no annual work.'

And what's next? A link to the 2021 Form? Which KINDA makes sense, since people are working on their 2021 returns. But then some people are preparing to take their 2022 RMDs now. The would need a 590-B TWO YEARS later than the one that is linked right ont he IRS website. It's not like it's some third party site, it's the gosh darned IRS site!

I found the Federal Register page. I even have the text from the FR itself. But what is a participant to do? If they went to the IRS site, typed in RMD then followed "Retirement Topics--Required Minimum Distributions (RMDs), then "Calculating the RMD" and clicked the link to the Uniform Life Table: That leads to 590-B (2020). How is a participant supposed to PROPERLY calculate their distribution?

When I go to the "Retirement Topics — Required Minimum Distributions (RMDs)" page of the IRS it mentions the new age 72 rule. However, under "Calculating the required minimum distribution" section, the link to the Uniform Life Table leads to Publication 590-B (2020) and the sub heading says "For use in preparing 2020 Returns" Can I even find the new tables in the Retirement section of the IRS site? If so, where?

Do it now and plead for a waiver?

Our SPD says: (I think the bolded means adoption agreement and underlying plan document.) 1. Examine, without charge, at the plan administrator's office all documents governing the plan and a copy of the latest annual report filed by the plan with the U.S. Department of Labor. 2. Obtain copies of all plan documents and other plan information upon written request to the plan administrator (the administrator may make a reasonable charge for the copies). 3. Receive a summary of the plan's annual financial report. The plan administrator is required by law to furnish each participant with a copy of this summary annual report. 4. Obtain a statement telling you whether you have a right to receive a benefit at normal retirement age and if so, what your benefits would be at normal retirement age if you stop working under the plan now. If you do not have a right to a benefit, the statement will tell you how many more years you have to work to get a right to a benefit. This statement must be requested in writing and is not required to be given more than once a year. The plan must provide the statement free of charge.

My understanding is that if it's NOT a C-Corp, you can do the EZ.

My document provider said there shouldn't be a problem, but, like the KGB: Trust but verify. Does anyone agree with my document provider? (Nothing that req'd a 2021 date that I know of; we executed the Hardship/RMD amendment earlier in the year.)

What are the consequences of a client signing the Post PPA document with a date of 1/4/22 and the restatement is effective 1/1/21?

True dat. I didn't think it was needed. Thanks.

No loans to owners.

I know participant statements must get a blurb if the PS is allocated using a permitted disparity formula (integrated with SS). What if the formula is grouping method and subject to testing? The contribution COULD be allocated using permitted disparity. Is that same disclosure needed on the statements in that case?

Can you wait until the next SAR goes out and send it with that?

I understand. My point would have been, if the amendment is eligible to be effective retroactively, then just do a new amendment with a retro effective date and sign currently and just trash the old one.

I always assumed that W-4P was used for RMDs. I just became aware of the existence of W-4R. W-4P is for periodic distribs from a plan and the -4R is for non-periodic payments. Are RMDs considered periodic from DC plans? Most of the participants' RMDs that I work with are pretty much on an ad hoc basis: they take them at various times during the year. I have one lady who takes quarterly payments totaling her RMD for the year, but most take just one payment at the time it suits them. So, should we be using W-4P or -4R?

What was the amendment for? It is eligible for retroactive treatment under EPCRS?

Quite simply, cost. However, using overseas labor usually only pays off in scale.

How much much would be due on a $19,000 deferral How much match would be due on a $19,200 deferral What is the difference between the two. I agree with Mr. B., though. Comp of $137,500 and a deferral of $19,200 leads to a 13.93% deferral rate. Well above the threshold for the maximum match. I doubt this would make a difference, but is the match calculated on a payroll or annual basis? My last suggestion is to check with ASC and ask them to give you the reason the system is calculating the $14 excess match. (Whenever my r/k system spits out an answer I am not expecting, it bugs the heck out of me, and I spent probably way too much time trying to figure it out. I have zero compunction in dialing up the help desk and have them explain it to me. More often than not it's my fault. Something isn't selected properly in the specs, or I have some data int he wrong place...)

Temps here in America? Hire more FT employees? I doubt hiring another TPA is either feasible or possible. Lots of TPAs are loaded up what with Post PPA restatements and now testing season upon us. (I got 5 censuses myself over the holiday weekend!) And why would you want to share you (partial) cleint list with a competitor?

Drop a line to your local Congressman/woman and ask them to change the rules...

Bri got it right

Pro-tip: Whenever you make a poll, always make the last option "Other" or something like that. I often will make it something cheeky like "Who the heck cares? Get a hobby!"