BG5150

Opening balance: $A Deferrals: $B Match: $C Distribs: $D Total plan earnings: $X Earnings basis: PARTICIPANT [BOY + .5(contribs) + adjs - distribs] / Plan [BOY + .5(contribs) + adjs - distribs] Total participant earnings: Basis * Total Plan Earnings That is all the attorney needs.

Only a handful of other employees. However, it only seems that a retroactive amendment is allowed via VCP. Plan has $650k in plan assets, so VCP fee alone is $3,000. Plus, our boss doesn't think we should prepare the filing. (I would have no problem doing it.) So, add in an attorney's fee for doing it.

High end boutique. Around $250k in income every year. Around $25-30k PS for 6 or seven years. Plus earnings.

'Twas the trustee who too the distribution. The trustee was informed she could take an in-service withdrawal eligible for rollover. Not by me! So, the Ttee thought she was acting within the rules of the plan.

Update on the facts: The distribution was for $220,000. There was no money source (yet) as the money is in a brokerage account for the participant. The brokerage does not separately record keep the sources; we do that annually. She had enough funds in the PS account at BOY to support the distribution. I believe the money is still in the IRA, so re-payment may still be possible.

From EPCRS 6.06(4)(a): But I guess I have to use VCP.

She rolled it over. Are COVID distributions allowed to be rolled over?

Plan allows for in-service withdrawals at age 59.5 for deferrals and SH, and PS at NRA. Participant was told she could take an in-service withdrawal from the plan. She was not told about the age requirements. She took a $100k distribution from the brokerage account in September 2020, and a 1099-R was issued. Problem is, she is only 35. Can we retroactively amend to allow in-service w/d from Non-Elective contributions at age 34? I see in EPCRS you can do that for hardships and loans. Nothing about "regular" withdrawals. If not, what's the correction? Return the money and reverse the 1099-R?

Why does the plan have the EACA? Do a lot of people take advantage of the 90-day withdrawal window? Do they really need an extra 3 months to do their ADP refunds?

I'm not sure what the point would be. The thread will soon be buried behind dozens of other "normal" ones. Unless there is a separate subsection for them...

More info: https://en.wikipedia.org/wiki/When_I'm_Sixty-Four

If there are any losses in these corrections, it is up to the plan administrator to make the participants whole. If it was the investment company's fault or the TPA's fault, it is still incumbent on the plan administrator to pay for the losses--it wasn't the participant's fault. Then it's up tot he PA to seek relieve from the offending party.

Maybe those cents are into the fourth or fight decimal place of the fund price? Can't sell 0.0001 share. Just spit-balling.

I wouldn't reduce the deferral excess allocation, but refund it. I'm not a big fan of mistake of fact processing. Who is making sure the participant is being "made whole" outside the plan? That the deferrals will be paid to the EE, but without doubling up on the reduction already taken from the deferrals?

Tell him to run it past an ERISA atty

Side note: if and when it's distributed to the participant, what 1099R code do you use? I'm sure it's exempt from the 10% penalty tax.

I do not think this applies to Deferrals. From EPCRS: 6.06(2) Because what if there are no employer contribs? EPCRS explicitly says the suspense account cannot be used to fund deferrals.

If they even remembered they needed one in the first place...

Thanks, all.

Former Employee left in 2019,turned 70.5 in 2020. Her first RMD was for 2020, but that was suspended. Initially, she needed to take that one by 4/1/21. But since she didn't have to take it, the 2021 RMD will be her "first." Does she have until 4/1/22? Or is is due by 12/31/21?

Two participants took distributions in 2020. The paperwork CLEARLY states that they wanted state tax withheld at 10% (New York). The major carrier failed to withhold. Participant only finds this out in February 2021 when they get the 1099-R. The carrier told me that because NY doesn't have mandatory w/h, they just don't do it. Even though the form, again, CLEARLY, has a section for it. Does the participant have any recourse against the plan/carrier for failure to execute the instructions (in seemingly good order) of the account holder?

If he can get the taxes paid on time, he can get the 401(k) deferrals (and loan repayments; don't forget those!) where they need to be. If the current process is inadequate, then the process needs to change.

I wouldn't worry about it. Fact pattern is there.

I change my mind. I think they enter on the next entry date after rehire. They didn't fully satisfy before termination. So under my document, they revert to the schedule for new hires. But upon their rehire, they have 1 YOS and are 21. So they enter ont he next entry date.

As far as I know there is no exception for owners and their families. The law doesn't seem to be there to protect participants, but to dissuade companies from using what should be plan assets for its own use.