BG5150

The AO has been semi-replaced with goactuary.org. The Outpost is up and running again, but with a much pared-down forum section. Though there is a back-door somewhere so that people can get into the legacy forum and still post. Not sure if any new exam questions would be answered, but the old stuff is probably there.

Could the employer open an account solely for the use of these funds and institute a policy that within a certain time of the account being funded, a wire will be issued to the reserve fund?

Same goes for a "1% owner."

never mind, just re-read an earlier post that said the EE notified the ER in mid-December. However, they mus start the deferrals before the end of this month and adhere to the notification requirements in EPCRS.

In order for the sponsor to be eligible for the safe harbor relief: [quote](i) Correct deferrals begin no later than the earlier of the first payment of compensation made on or after the last day of the three-month period that begins when the failure first occurred for the affected eligible employee or, if the Plan Sponsor was notified of the failure by the affected eligible employee, the first payment of compensation made on or after the end of the month after the month of notification;[/quote] When did the participant notify the employer? They may still have time to correct this. But nothing will be in/for 2020. It'll all be QNEC & earnings plus deferrals starting in 2021.

Does the document allow for 90% deferrals? If money does not come out of the paychecks in 2020, it will not be reflected on the 2020 W2. Part of the correction is to make sure this mistake does not happen again. So, the sponsor must investigate why the r/k had 60% in their system. Is it a system limitation? Did it used to be 60% and the plan was amended? If so, was the amendment disclosed to the r/k? If so, why didn't they implement it. Was it just a mistake?

Look to the plan doc first. does it allow deferrals up to 90%. The r/k website was coded that way for a reason. (Maybe it was a mistake, maybe when it was programmed the max was indeed 60% and an amendment was done and somebody dropped the ball, or, again, it was indeed 60% all along) Does the participant have an SPD that says at least 90% max? If so, then, yeah, the company is on the hook for the EPCRS correction. If not, what was the original deferral amount? Was it already at 60%? Or lower?

For whatever reason, the payor EIN on the schedule R has been the company's tax id for several years. Up until 2015, they were using the EIN of the custodian. Should we amend those filings for that little thing?

Controlled group with 4 companies. Only 3 of them adopted the plan, but all four companies are participating. Can we do a retroactive amendment having the missing company adopt the plan back to 2013?

General Motors?

I've never reported them, but I never understood why. I started a thread many years ago here, but I don't remember any resolution to it. My theory was that the funds belong to the plan. If they are used for fees, so be it--plan funds were used to pay fees. If not, then it got allocated to the participants as earnings. Still a plan asset. Maybe it's not considered earnings until it's actually allocated, like a dividend? Dividends are declared ahead of time, but are not considered plan assets until they are actually allocated...

Not true. It's semantics, but from: RC 416(g)(4)(H). Note, a plan funded by only SH contribs, the plan is NOT Top Heavy. Doesn't matter if the TH% is 5% or 99%. Plan is not top heavy. So, the 3% SH (or match) doesn't satisfy the TH contribution if it is the sole ER funding. The plan is not considered TH in that case; there is nothing to correct.

So, if I have 5 yrs of service on a 3-yr cliff schedule, I'm 100% vested. If my employer wants to change to a 6-yr graded, my old money (obviously) stays at 100% vested, but also all my future contributions? (I've been fortunate to only have done vesting amendments a handful of times in my career, and they have all been a liberalization of the schedule.

You are paid hourly? I would think that is more the exception than the rule in our little world.

That applies to the accrued benefit. You can make it more restrictive going forward. You would just have to record-keep two buckets for each vestable money type. At least that's the way I've always seen it.

Put the additional match in a bank account in the plan's name (under the trust id #). When the plan comes out of blackout, put the funds in participant accounts and adjust for earnings. Check the 415 rules for when the contribution will be considered an annual addition for the participant. I'm not sure if it would be 2020 (when the funds left the ER and put into the adjunct trust, or bank, account) or 2021 when they actually gets invested in the accounts. Really only relevant if anyone is close to maxing their 415.

I wanna work where you work. 50 plans is 4 a month, one a week. I could handle that!

How do you react/respond to a client's request for their current plan docs (AA, BPD, SPD, etc)? I find in way too many cases, soon after I supply the requested material, I get a letter saying the client thanks us for our service, but they are making a change. Why should I facilitate that? I know that's not the case will everyone who requests them, but I also want to shout into the phone: YOU SHOULD HAVE ALL THIS. IN FACT YOU MUST. How do you admonish the client for not having these doc without sounding like a jerk?

That all depends on the support the administrator gets from the company. If there is a good tracking system in place and good management overseeing it, then it will remove some of the burden. If the data collection requests are largely sent out and collect by support staff, that reduces some of the work. Is there staff to handle the approval of distribution requests? Billing? Someone preparing docs and amendments? I've been in places that had a lot of support, so I could manage my caseload a lot better and even be somewhat proactive with my clients rather than being merely reactive. I've also been in places where the admins were similar to independent workers, getting a caseload and being responsible for everything, including sending out YE requests and followups, approving distribution requests, preparing docs and amendments, PS illustrations, testing. Everything. With only a modicum of oversight. I don't think keeping everyone at a static level of cases despite complexity. A small plan with brokerage accounts and a less-than-knowledgeable employer can take up more time during the year than some large plan filers at a good carrier. The TPA needs to balance that across its admins. Otherwise you can foster resentment. "How come I get all the difficult plans, whilst Lisa only gets the 10-person John Hancock plans? I'm working until 6 every night while she goes home at 4:30..."

No owners?

How old is that phone forum? 7-8 years? In that time has any audit or investigation ever have a problem with prime +1 or even prime? I'm sure we would have heard it through the grapevine somehow.

That I don't know. EPCRS has the 415 corrections.

People have been using prime +1 without consequence (that I know of) for years now.

Yep

Is it a 5500 or 5500-SF? Then, yeah. As long as it's readable.