BG5150

And I'm not even a senior yet. Yet. it's coming soon. too soon...

What's the penalty for filing an EZ if you should have filed a "regular" 5500?

Yeah. Never mind this. Another senior moment. Not my best week...

If somebody is making both pre-tax and Roth deferrals, what's the hierarchy for the SH Match? If they are deferring 5% pre-tax and 5% Roth, does the match go 2.25% pre-tax and 2.25% Roth? What if it's like 8% pre-tax and 1% Roth? 4% pre-tax match and 1/2 % Roth? Would it be in the document?

PS plan effective 1/1/2017 added 401(k) and QACA SH on 3/1/18. What comp am I using for the SH? Plan comp says full year and not participation comp. Total senior moment right now.

Company A based overseas, has wholly owned subsidiary in US with a plan. Several employees from parent will be working for the US company. 1) Do they HAVE to recognize service with the parent company? 2) if yes, do we even have to do an amendment? 3) Is the same controlled group testing done for foreign companies (in case this parent owns some or all of other companies not based in the US)? If not, I guess we would list the companies for which service would be credited.

For next year, put in a new comparability formula for the greatest flexibility.

No. You do not get a match on a 402(g) excess.

Plus, this investment would be part of a brokerage window, so the investment isn't necessarily trustee-sanctioned.

If the dual eligibility was only for the HCE, does it really lose the TH "pass"? You can exclude HCE from SH with no ramifications. So what then if they are excluded from PS, too? Say you had a plan whose sponsor chose not to do PS. It's just 401(k) and SH. Are you saying if the HCE are excluded from SH it would be a red flag because they are making deferrals that aren't tested?

A qualified plan "account" for a participant is not like a bank account or, say, a simple brokerage account, everything in one bucket, so to speak. It contains sub-accounts, one each for every source in the plan. You cannot switch between sub-accounts, but you can within them. If you could switch between sub-accounts, why wouldn't everyone move all their unvested profit sharing money to their deferral account?

The QDIA notice is the responsibility of the Plan Administrator. And the sponsor. it is a fiduciary responsibility. Often, the record-keeper or platform provider (or whatever term you prefer) such as Voya or John Hancock, etc., can and will provide the notice to the PA. Sometimes they will distribute it, too, but it is still the PA's responsibility to make sure its done. Sometimes the plan document software can provide a template, and whomever usually prepares the documents can fill in the appropriate values and generate the QDIA. Again, it is the PA's responsibility that it's done. (Some plans contract with a 3(16) Plan Administrator to get it done.) In absence of the document provider or the investment provider, the financial advisor's office can (and should) help develop the notice. But in the end, it is still the Plan Administrator's responsibility. If the PAS cannot produce a compliant notice, they he or she should (must) contract with someone who can.

It is from the play Book of Mormon https://bookofmormonbroadway.com/tickets I'm not big fan of people who make fun of religion or religious beliefs, but that play was HILARIOUS!

So, Austin, could I exchange my 0% vested Fund A in Match to a 100% vested Deferral source in fund B? What happens when I exchange my guaranteed by statute 100% vested contribution to deferral to a vestable profit sharing source?

My bad. fix'd my post.

Could he move $3,000 from fund A in deferral to fund A in his match account? No. If the loan is an investment, why do you think he could do ostensibly the same thing? Such a setup could be rife with abuse. What if there were no basis in deferral. Loan was taken 100% from PS. Now the participant transfers part of the loan obligation to deferral. Is that kosher?

Ask the law firm TPA to cite their reason.

We are planning on amending our plans in 2020 for the new hardship rules. That includes the no more suspension of deferrals. What happens is some takes a h'ship now? Their suspension period would go until February. Does the suspension just go away Jan 1?

This is addressed in EPCRS. It's an excess allocation. Somebody got too much match. The correction? Simple. Remove the excess amounts, adjusted for earnings, to a suspense account (usually the forfeiture account under the plan. But as jaa said, these are not "forfeitures"). EPCRS calls this an "unallocated account". The money in the suspense account must be used to offset the next ER contributions. In fact, no ER contributions can come from the ER until that account is exhausted. Excess amounts are disregarded for 415, 402(g), ADP & ACP tests. Section 6.06(2) of EPCRS. Relevant section spoiler'd below.

I meant why would excluding HCE for everything but deferral be a "huge flashing red light"?

Why is that? To me, as long as coverage is passed, then it'll be ok.

You have to allocate according to the terms of the document. If an HCE is part of "group 2" then she gets the same allocation as the rest fo the people in group 2 if she accrued the right to a PS. If you need/want to give someone MORE for whatever reason, you can do an 11-g amendment. What you CANNOT do, if have any increase favor HCEs. For example, say you have plenty of room passing testing. You can't give HCEs more to get closer to that passing threshold. Another thin you cannot do is reduce the amount for anybody (usually an HCE) in order to pass testing. Everybody in their own group alleviates some of this. A time where you would need an 11-g amendment in this situation is if there is a last day rule and someone is only getting the SH and gateway and the testing requires NHCE getting more than the GW. You can't just give that person more; they didn't accrue the right to a PS. However, you can do an 11-g amendment to give them an allocation. (This is one reason I do not put in allocation requirements in my docs with everyone in own group.)

What if someone is eligible for 401(k) but does not qualify for PS?

Me?

That's why we like to do them by the end of June, the latest. No harm in sending one in but filing before the original deadline.