BG5150

You test the Sh contributions with the Safe Harbor. So, you should have 100% coverage unless you are excluding a group of employees from the plan. You may be failing 401(a)4 testing. That could be remedied with an 11-g amendment. I really don't think you are failing coverage, though...

How can he know the employees (or his) account balance? Has the property been appraised and the FMV reported every year? Side note: if the property can't be off-loaded at or near appraisal price, is there something wrong with the appraisal--obviously over-valued?

The only way you are going to fail 410b for SH is if you fail it for 401(k), too. Because anyone who is eligible to make a deferral gets the SH.

what's a federal qdro?

Only the client can tell you if it's W2. What entity type is the company? I would believe an owner would be performing some sort of services for the company. Unless it's a partnership and all he took was draws and only had an investment relationship.

You definitely could NOT pay fees with it. The "removed" match is not unvested, hence forfeited, funds. If anything, this could be considered an excess allocation and be treated according to the correction principals in EPCRS.

Yes. The generally have the same withdrawal restrictions as deferrals.

Thanks, RBG! Just what I was looking for.

I always thought that eligibility is not a protected benefit. For example, a plan has a 3-months of service requirement and month entry dates. Rhoda was hired on February 15 and would enter the plan on 6/1. However, in September that year, the ER amends the plan to require 1 YOS with semi-annual entry dates, and does not specifically exempt those already in the plan. So, to me, Rhoda is no longer an eligible and active participant in the plan until 7/1 the next year. Can someone point me to some guidance on why this is; ie, that eligibility is not a protected benefit... EOB or the code would be cool. I can't find it in Sal's book, but I'm sure it's in there somewhere...

If that is the ONLY Key EE deferring, you are correct. The rules are the lesser of 3% OR the highest Key allocation %.

You also have three more "zeroes" in your ADP & ACP testing...

What does the document say about what the remedy is? Is there a fail-safe provision in the plan?

Isn't there an 18-month transition period where you can test them separately?

415 comp, which includes most everything there is. The EOB has a great chart as to what's included and what's not.

Many times, TPAs give clients the #'s the TPA thinks the client will want. And the client thinks that the TPAs #'s are the ones that have to use. I always ask, especially new clients, what they want to do for the year. And I won't say, "do you want to do the same as last year." I will summarize last year's allocation: "Do you want to maximize the owners and only give a handful of staff a contribution, giving everyone else zero again this year?" (To use Tom's example). Some companies actually want to share (some of) the profits with all their employees....

Get the payroll report. Don't use W2s.

Or, if you quit or get fired, you are exempt from the penalty, too!

Now that we know your DOB, can I get your SSN and mother's maiden name? A PM will do. No need to publicly just throw it out there...

Who's going to look at past years? Get your VCP pencils sharpened.

Plan at one time offered an annuity product as an investment to all. After a while, they stopped offering to participants. At the moment, the owner is the only one in the investment and he is making contributions therein. Is this a BRF issue in that he's the only one allowed in the investment? Or is it ok, because at one time it was offered to everyone and is now, for the plan, closed to new investors?

Then I wouldn't think that Roth IRA money to a 401(k) plan would be an issue in this case. I would process it as a transfer in.

Is a "buyback" a rollover into the plan? What if the plan does not allow rollovers in?

I'm using Relius. Eligible participant terms with 256 hours during plan year. She does NOT show up in my 401(a)4 testing, however she shows up in the Average Benefit Testing. Should that be? I thought term < 500 hours and you are excluded from all general testing...

I'm with Larry. If this is an Adoption Agreement plan, check the BPD section on comp. Unless the doc was drafted by an incompetent party, then, undoubtedly SE comp will be in there.

What if prior comp is less than zero? And what about the daughter? She should have her K-1 and W2's combined. (Though I don't think partners are supposed to get K-1s and W2's in a partnership. They do in an S-Corp.)