BG5150

It doesn't make any sense to do that, b/c they will still be subject to TH and ADP testing for the year anyway. If they are worried about having to make the contribution to satisfy the PPP, just amend to a non-discretionary match calculated per payroll. Then amend out again.

OK. Got it. That's what I figured. Something in the wording gave me pause.

I have another question. This is from the DOL closing letter: Say for 2017 the amount involved is $100. Interest paid 2020. The excise tax will be $15 x 4 = $60 because there were 4 taxable years it was outstanding. However, do I owe another $300 for the tax years it wasn't corrected per item #2?

??

Does the plan not already allow for loans? Just curious.

is that a taxation issue? If the dad is dependent on the tax form, then he is a dependent in this case...

If you want to do a PS, you could use the ABT to pass coverage if the demographics are suitable.

Exclude HCE Discretionary match: hourly get match 1, salaried get match 2. Automatically passes BRF and ACP. But if the owner does not want to get a match, is it worth it to even have a plan and pay $1,500/yr TPA cost (plus carrier fees) with less than $2000 ER contributions? How much are those NHCE EE's deferring? Maybe a SH Match? is that person (hourly) making $30k a year deferring a lot?

That was my first thought..

Does the owner have to get anything? If not, just exclude the owner.

If the plan made the interest payments for late deferrals from 2017, '18 and '19 in 2020, do I still need to do a 5330 for all those years? Or just 2020?

I think it's more of a document issue. What does the document provider say about doing that?

In 2011, the IRS and a phone forum that suggested that prime or prime +1 might not pass muster as "reasonable." Here is the transcript: https://www.irs.gov/pub/irs-tege/loans_phoneforum_transcript.pdf However, in the intervening 8 or 9 years, I have yet to hear about anyone getting in trouble for prime +1.

They are also too late to adopt Safe Harbor provisions for 2020. That ship sailed 12/31/2019.

These kind of things pop up from time to time. Once in a while somebody will do a review of 5500s with zero or inadequate bonds and start scaring people with unsolicited calls that their plan is out of compliance. Or they look for the late deferrals item. Same schtick.

Are FFCRA wages subject to 401(k) withholding? And the subsequent match responsibility?

The IRS would have issue with only the HCE deferring. However, election forms by the NHCE showing the request to not make deferrals solves that issue. If they say they have it in writing, it's not on you.

Darn, CBZ. I forgot about everyone getting the GW. I did say MAY help, lol.

Component plans is one way you MAY be able to get around this (no guarantees). However (to me) it's a little advanced to explain it in one or two posts. Is there someone in your office familiar with the process?

I think he meant "NHCEs" that's all. Ah, Mr. Rigby beat me to it...

Re-read your second sentence carefully....

Are there any HCE at the 3% level? Can there be? Will you be able to use component plans?

You can separately test those employees with less than 1 YOS (and under 21). So one group will be the HCE and no one else. It's not that no NHCE benefit, it's that there are no NCHEs required to be in that group. So it automatically passes. The other group is all the NHCE, but no HCEs (similar to the group above, but opposite). So automatic pass.

I would posit: what's the difference? They are taxed the same. Both money sources are 100% vested. Now that h'ships are possible from earnings on the 401(k) sources, there is no reason to keep track of the h'ship amounts over the years.

I second the notion of getting an ERISA attorney involved. Who knows what else was missed.... Who was administering this plan throughout the years? Who was doing the 5500's?