BG5150

Side note: If they know this NHCE will not ever defer, could they put in a triple stack match for next year to get the HCE up to the 415 limit, or close to it? 6% SH enhance match 4% discretionary match 85% of deferrals up to 6% of pay (or whatever formula works to max them out) Remember, only the discretionary match has the cap of 4% in dollars. The company cannot match on deferrals above 6% of pay in any of the tiers and stay SH compliant.

For the discretionary match to also be ACP SH, like Artie said, it has two independent constraints: The discretionary match piece cannot match on deferrals on over 6% of plan comp. Also, the total dollar amount of the match awarded cannot be more than 4% of comp. So, your discretionary match could be 66 2/3% of deferrals up to 6% of pay. It satisfies both of those conditions.

Wouldn't that feature have to be supported by the record keeper? Do houses like Hancock or Voya or Empower support it?

Your compliance software should tell you that all deferrals of the HCEs should be returned. (If an HCE is at least age 50 in the plan year, you can recharacterize up to $7,500 as catchup and not have to be refunded.) You cannot 'disaggregate' NHCEs from HCEs.

I went to 72(p)(2)C: "Except as provided in regulations, this paragraph shall not apply to any loan unless substantially level amortization of such loan (with payments not less frequently than quarterly) is required over the term of the loan." How can an adjustable rate loan be level with an adjustable rate?

Thanks all. I was leaning toward the fact that the employment is implied until outright, um, terminated. So we are going to forgo the RMD this year. We will check in with them in January to see if the relationship ended in late 2024. If it did, we will get the RMD done before 4/1.

Guy works April to November every year. Turned 73 this year. Since he is not employed on 12/31 does he have to take an RMD? Do service spanning rules apply here?

Does it say anywhere that the comp limit is the FIRST $345,000 earned? (for 2024) My doc says "Compensation in excess of $200,000 [as indexed] shall be disregarded for all purposes other than for purposes of Elective deferral." Does that mean someone who earns $700,000 a year, but doesn't start deferring until the second half of the year will get no match? Doesn't make sense. But plan sponsor and advisor want something in writing.

Plan name: ABC Corp 401k Plan Employer on plan doc: DEF Industries, Inc, d/b/a ABC Corp Plan Sponsor on 5500: ABC Corp is it ok to just list the d/b/a as the Employer

Sorry, just realized the OP was way misleading. Edited. This all has to do with, and only with, the 5558. No 5500 or 8955....

Wrong on the 5558.

I've been at a few that did. years ago, I was an "Sr Plan Administrator" Our rates were: Admin $75 Plan Admin $175 Sr Plan Admin $190 (dang I wish I was getting paid $190/hr) Manager $225 Actuary $300 We normally wouldn't bill for something like responding to a 5558 letter, unless it ran into several hours of work we were not anticipating.

Plan assets transferred from Carrier A to Carrier B in 2023. Auditor is looking for reportable transactions (those over 5% of assets). I've never completed that for any transfer between carriers before. Have you? I've had several other plans change carriers mid-2023 and none of them were asking for this. The exception is an individual account where the participant directs the transaction, but the participants in these cases don't direct these transfers. Do I have to attach a schedule per 4j on the Schedule H?

This is why you don't wait until 7/30 to send them. Do it in June. If you get the 5500's filed by 7/31, great. Just don't check the box. Larry Starr (an OG poster here) used to send out his 5558's in January. (At least I think it was him. If not, someone here did that)

Plan name is different than employer name. But we filed the 5558 with the ERs name as both the ER and plan names. For example: Employer: Connecticut Fencing Company Plan name: Fences 'R' Us 401(k) Plan 5558 filed with plan name: Connecticut Fencing Company 401(k) Plan EIN and PN are correct. Will we have a problem? Software is giving me a warning.

Thanks!

Do I have to file a 5500-SF for a plan that was effective 1/1/23 but not adopted until May 2024?

But the match rate changes mid year.

403(b) plan has a Discretionary Match, allocated per payroll, no true-up. Match formula is dollar for dollar up to 5% of pay. Participant makes $700,000 per annum. 2024 Comp limit is $345,000. Should they stop the match when it gets to $17,250? (5% of $345k) Or stop when their compensation hits $345k? Or continue the match and we will use $345,000 as comp in the ACP test only? And there is a wrinkle: They changed the match starting August 1 to be only up to 2% What would the annual max be then? Would it be 3.75%? Or $12,075? That’s (7/12)*.05 + (5/12)*.02 : 7 months of 5% and 5 months of 2% averaged. I know it’s a lot here. Just trying to point them in the right direction if/when to stop. Keep in mind these are payroll matches, not annual.

If we amend a plan to allow for Federal disaster relief distributions, is that semi-permanent? Can they remove that provision without a cutback of benefits? Like age 59 1/2 withdrawals?

For the “evicted from principal residence” category, would an uninhabitable house qualify? I have a participant whose septic system needs repairs. Without a septic system, the house will be considered uninhabitable and they will have to move out (albeit temporarily).

Is there specific guidance anywhere that says Employers should not stop payroll matches when the employee reaches the max compensation during the year? For example, plan matches dollar for dollar. I don't see why the Employer should stop (testing reasons notwithstanding). Or, maybe someone started deferring in March with a 50% of deferrals no more than 6% of comp (for a cap of $10,350 on $345,000 in comp). They hit $345k in September, but hasn't hit that match cap yet. We know they are supoosed to keep going until they hit a cap, but is there anywhere that says it outright?

When these self-certification plans get audited by the IRS in a few years, will they be looking for proof? Who gets in trouble if someone self-certifies a hardship that has nothing to do with one the safe harbor rules? (I need a new car. Not safe harbor reason. But, participant my reason it thusly: I need a new car to get to my job. Without my job, I can't pay my rent and I'll get kicked out.) Will there be a steep penalty tax on the participant if they mis-interpret the rules and they get caught? How does it affect the plan? How so, then?

Plan calls for SC for loans with balance over $5k. So, if the balance is $6,500 and they want a loan for $3,000 I still have to get SC, right?

Company has to give people "retro pay" going back to 2022. Do they need to take deferrals from those? Do they need to include that income for the 2022 and/or 2023 ER contributions? It's a 403(b) Plan, and the document excludes all post-severance compensation. But it this post severance pay? It should have been paid way back when. It's not like a trailing commission or a bonus that was genuinely paid post-severance. Your thoughts are apprciated.