BG5150

EPCRS says to distribute the money. However, I'm thinking because EPCRS says "in contravention to 401(a)30" and neither individual plan went over (a)30, we cannot use this method. And just to be sure, if a participant has their individual tax return on extension, they still cannot make the distribution because the regs say prior to April 15 and mentions nothing about the individual's tax deadline?

I'm just wondering if they can do an excess deferral distribution at all. Age 40. No distributable event. And if he can't take the distribution, where can I find the backup. A cite to EOB or the code would be appreciated.

In 2023, EE deferred 7,000 to plan A and 22,000 to plan B. Neither plan had excess contributions under 401(a)(30). Nor, individually had an excess over the 402(g) limit. Is it too late to correct the participant's excess deferrals? If so, where can I find that language? I looked in the EOB, but didn't see it. Is it in the code somewhere, too?

So just to be sure: the NHCE NEVER worked more than 1,000 hours and NEVER qualified for the profit sharing component of the plan?

Participant ina plan took a distribution in early 2023 from his account with Provider 1. Never cashed the check. In the interim, the plan transferred to provider 2. Meanwhile, the check got stale dated and Provider 1 sent the proceeds to Provider 2 who put it in their Unclaimed assets account. Subsequently, the funds got paid out to his IRA. The participant is looking for a 1099-R. Neither company is claiming responsibility for the 1099-R. Provider said because the check went stale dated, they have no responsibility. Provider 2 is saying they won’t doing it either since the distribution didn’t happen on their system. Any idea whose responsibility this is?

Plan as-written was participant directed but everything was invested in a pooled account. For a bunch of years. Currently, they are with a record-keeper and everyone is directing their stuff moving forward. What's the fix for the prior years?

An 11-g amendment letting them in for that particular year only. Done.

They don't have to. But I always continue to file. 10 minutes of work every year is less than than it's gonna take going back and forth with the IRS as to why the form doesn't have to be filed in the first place.

Does the plan have fail-safe language to fix coverage issues? If it does, do you even have 11-g available?

For such a big plan, I doubt is would be feasible. If you offer it to one, you have to offer it to all.

Dude, that was like almost 5 years ago! But I did forget about it. And there was no overall consensus. Thanks for the reminder.

Plan has a few participants whose religion precludes them from investing in any of the plan's alternatives. There are several hundred active participants. What duty, if any, do the fiduciaries/trustees have to include a fund/funds that would be eligible under a haram/halal investing strategy? It is quite a niche corner of the investing world (at least here in the US), and funds can go from performing to underperforming quite rapidly quarter over quarter. Would the these participants have some sort of religious discrimination claim if these types of investments are not offered? just on a fact-finding mission for now. I sent the plan sponsor to their attorney, but I'd like to get the community's take on this.

Company inadvertently added a term date to a participants census at the r/k. Subsequently, the participant was forced out (twice). Neither of the checks were cashed and they will be re-deposited into her account. However, there was 20% withholding from one of the checks. How is this usually recouped? (This did not cross tax years)

If a 403(b) plan excludes EEs who work <20 hours a week, are they excluded from the 410(b) coverage test by default?

If you are never unsure what a particular provision in a document means or doesn't mean, ALWAYS check with the document provider first. They wrote it and support it. If you are not satisfied with the answer, then consult inside (your company) SMEs. Thay may dealt with the same issue in the past. Then consult outside support if needed.

Was the default investment communicated to the employees

Is it a preparer of the 5500 or the auditor? If it's the auditor, run!

Quick example: One distribution $10,000 80% vested. Only $20,000 in deferrals contributed. Open balance: $100,000 Contribs: $20,000 Earnings $1,000 Distribution: ($8,000) Fees: ($500) Closing Balance $112,500 Note the distribution is NOT $10,000, but only the vested piece of $8,000. The $2,000 was already in beginning balance, and is still there (in the forf account instead of participant's account) at the end.

@thepensionmaven: did the plan doc say the accounts are supposed to be participant-directed? Of did you advise your client they should amend the plan to be participant-directed?

Here is a discussion from a couple months ago:

Also, if they amend the plan to loosen the eligibility rules, they shouldn't be too quick to change them back. They don't want it to look like they were just doing this for the benefit of the spouse. Are there any other, current employees who would benefit from a change?

Does the IRS match up 1099-Rs with 5498? Do IRAs issue 5498's for transfers in from, say, 401(k) plans? if so, I would think then need to amend both the 1099-R and 5498.

Was there tax withholding on the original distribution?

If the 5500 is done on a cash basis, is there perjury?

Where does it say that a participant must pay off a defaulted loan before they can take a new one? What if it was offset after a distributable event? (Plan allows only one loan at a time)