BG5150

But how long will that take?

I would err on the side of caution and make then 100% vested. Unless there is something in the employee's file that said they quit voluntarily (like a resignation letter).

How much was the extra match?

That is really none of your business.

One thing to examine is your firm's procedures regarding "EZ" plans. Our year-end correspondence always asks if the client hired any employees during the year, whether part time or full time, whether they were there at EOY or not. And who told him to stop contributing? Did he do that on his own? On the advice of his accountant? His TPA?

Before you start down that road, did any of those employees satisfy the eligibility requirements of the plan?

[Insert Dungeons & Dragons joke here]

Thing about IRAs, once over RMD age, can't you take what ever you want when you want to, it's just you HAVE to take at least the minimum? Qualified Plans don't necessarily have that feature.

In anticipation of other employees?

It was the sponsor's discretionary decision to move TPAs. But because of that, they need a new document, as the old one is no longer being supported. Let's just assume this is NOT a required restatement for Post PPA.

Plan is moving TPAs. Old TPA (obviously) will not continue to support their plan doc. When the plan is restated to the new TPA's doc, can that expense be passed on to the trust? Either forfeiture or participant accounts?

Is $54 really that big of a deal for him to contribute? How much was the match to begin with?

You may or may not. The partners will just be 100% in the 414(s) test. Just run the test. Can't be too hard.

If the revenue you derive from the 3(16) Service outpaces the fiduciary insurance premiums and covers the cost of the extra work with some profit at the end of the day, then I think it could be a win.

CLE401kGuy: I would certainly get a separate 3(16) Service agreement in place. Make it air tight--dot your t's and cross your i's. Get your counsel to sign off on it. If you are being paid extra for that, be careful of prohibited transactions. Especially, if the fees may come from the plan.

Who is paying if the funds have lost money since distribution, but would have gained money in left in the plan. For example, my distribution was $10,000 and I rolled it into my IRA. I was invested in Fund A in the plan. When the money hit my IRA, I put it all into some stock. I get a letter from the Plan Administrator that I have to return the money. But the stock sank, and is only worth $8,800 now. But if I kept it in the plan, Fund A was up 5% since I took it out. Who is compensating me for the loss in principal and loss of earnings in the plan?

I believe you can amend the profit sharing allocation mid-year if there is a last day requirement because no one yet has definitely accrued the right to share in the allocation. You will be fine to amend prospectively into 2022 to the grouping method. However, if you have plans with no allocation conditions for PS (I have several), then they will have to be signed prior to 1/1/22 to allow the change. Friendly advice: make sure you know what you are doing in/re cross testing. Just because FT William does the testing, doesn't mean you can just rely on the Pass/Fail results. It takes art and skill, sometimes, to decipher the nuances of the reports. And art and skill to "correct" a failed test to conform to the client's aims. You just don't keep throwing in 1/2 percents until the tests pass...

Maybe. The 3(16) Administrator may be engaged for only some of the general Plan Administrator duties, as long as they are spelled out. We had a 3(16) product where we would do SOME of the 3(16) duties and not be responsible for the others. We added plan language that "OUR FIRM will be considered a 3(16) Plan Administrator as outlined in attached 'NAME OF ADDENDUM'." In the Addendum, it outlined the the items we were responsible for such as signing the 5500; approving distributions, loans and hardships; and a few other things. It was noted that our firm was ONLY responsible for the items on the list and the Plan Sponsor, acting as Plan Administrator would be responsible for other duties of PA (or delegating those duties to another 3(16) administrator) such as distributing required notices, tracking eligibility, etc.

Just stream of consciousness thoughts: Did the sponsor get distribution instructions from the participants? Or did they just pay people out? Even if you allow a retro-active amendment for in-service withdrawals of PS money, it seems like these distributions were coerced, and not voluntary. How was vesting handled? Everyone 100%? If so, IF you do the in-service amendment, then you may need to amend vesting, too, if the source was not originally immediately vested. That in-service withdrawal provision would be a protected benefit. Could they terminate this plan, and adopt a new plan for 2021 with only PS and the 401(k) option available effective 1/1/22?

^ I agree

We do this for all our plans. Offers most flexibility. Pro-rata, integrated (only at TWB) allocations under this method both pass on contributions basis. If you want to integrate at a different level you will need to pass nondiscrimination testing. Be aware of your firm's pricing policy. A lot of firms I worked at/with charge more when there is a non-safe harbor formula in the doc, regardless of whether the client issues a profit sharing that requires cross testing.

I think that it's an (un)intentional back door to a site that acts as a middleman between ARA and candidates (I could be wrong) I sent ASPPA an e-mail about it.

That's not how my interpretation on how refinancing plan loans works. The first loan does not get repaid, but merely gets absorbed into the new, 'refinanced' loan. That is how you get around the thorny two-loan problem. If the plan only allows for one loan, you would not be able to take a second loan in order to pay off the first. With refinancing, there are never two loans at the same time. But, under the rules, the amount outstanding from that first loan must be paid off no later than 5 years after its origination.

Good point, CB. I knew we kept you around for a reason.

Is this for 2020? or 2021? If 2021, has the owner taken and comp yet this year? How much? Has he made any deferrals yet? More importantly, the wife? Any comp yet? Any deferrals yet? Also, husband can get the entire $33,750 b/c he won't go over 415 limit. (Assuming the PS is not pro rata in the document. (And like you presented above)