BG5150

(I really wasn't serious about telling the guy to quit...)

Why would the RK do that? They want the funds in the market so they themselves can make money, passing a little of it off to the FAs

A reason (some) financial advisers are against loans is that they take assets out of funds for which the advisers may be getting paid.

No it won't. That would only be the case if the participant pays the entire $10,600 back at the very end of 5 years. Maybe we did win him over a bit. Plus, loans could be a GOOD investment. In a down market, your loan repayments can often buy back shares at a lower cost that when you originally bought them. (Not that I advocate this as an investment strategy, just pointing out that taking a loan is guaranteed to be bad.)

Does anybody have a decent spreadsheet I can use? I no longer have access to TAG.

Tell him to quit if it means that much to him.

An example from the clip in the OP: Participant has $10,000 in Match, is 60% vested and terminates in 2010, leaves money in plan. (assume no earnings) At the end of 2015, $4,000 is forfeited per the 5 BIS rule. Account balance is $6,000. Person is rehired in late 2016. The $6,000 must be kept separate, as it's fully vested at the moment. Any new match is still subject to the vesting schedule, starting at 60% in 2016. After 2018, the accounts can be recombined (assuming participant accrued a YOS for vesting each year). This has nothing to do with buyback of forfeitures, as others have said.

Setting the first one up as a qnec is an option, but keep in mind the withdrawal restrictions.

I believe so. I've seen plans where spouses and or children of owners were excluded from SH.

The payroll system is wrong.

You need to determine if the error was significant vs insignificant. Insignificant errors can be corrected at any time under SCP.

The kill-joy was the person who thought I was trying to insert a sex-joke into my explanation. HR is just protecting their own butts. (Pun intended)

I used to do some in-house education classes at one of my old jobs. And to illustrate the point further, (this was before the proliferation of camera phones, so no selfies, Thank God), I said I dumped the money on the bed and rolled around naked on it. (Someone said something to HR and I was told to find another anecdote for my class. True story.)

When I wrote the author the e-mail, I used a similar example to Austin's. Here's mine:

What do you mean by " reclassifying the next $6k above that as catch-up since he's over 50."? Does he make more than $270,000? The 6% should come out of his pay until he hits $24,000 or the end of the year. If he made $400,000, the $24,000 is 6% of his pay. Don't confuse it with the % used for the ADP test. That would be 6.67% ($18,000/$270,000). You do not look at the comp limit when you are implementing the participants deferral elections. Just plan limits and 402g/catch-up. Deferrals are not "reclassified" until they go over one of the limits: 402(g), ADP test, plan limit.

Are TPAs subject to circular 230? I seem to remember in a past job that we were told to remove the Circular 230 disclaimer on our e-mails because it didn't apply.

Bottom line, though: find out what happened before you start amending W2's and making people re-file taxes.

My main question is: if the plan gets audited (or investigated), does the TPA have any exposure when it's quite obvious there was a late deposit and that we prepared the forms with an obvious omission. I do know the client said in writing (or rather electronically indicated) there were no late deposits, and that the client is signing the 5500.

A 12/30 payroll deposited in the first week of APRIL is definitely late. I think I see what you mean now. It was due around January 10, so it's a late 2017 contribution. But we do the forms on an accrual basis. So, the contribution is already on the 5500. Same crap, different day, though. And we'd have to remember to book it on the 2017 forms. The interest will be the same. So why not just get it taken care of today.

Was $465 the normal contribution for the recent payrolls? Maybe they capped out on week 52, but someone just assumed the money was deducted and passed it along to the r/k because that was happening in the weeks previously. If so, it's not a 402(g) excess, but an excess allocation. See EPCRS for correction. (I agree with Bird: W2's generally get generated through the payroll software, no? So how could 18,465 be withheld and only 18,000 reported?)

This was the 12/30/2016 payroll to the penny, and each p/r is different each week. It was coded at the R/K as 12/30/16 (it would have been an odd mistake if it was really for the 3/29 p/r). We had sent the client a breakdown of the "receivables" we had calculated, and a week or two later, the contribution is posted. Am I 100% sure without asking the client, but 99.8% sure given the fact pattern.

If you can't find her now, then mailing the check certainly won't help.

What is the TPA's responsibility when a client indicates in the TPA's year-end paperwork that there were no late deposits of deferrals (and/or loan payments), but upon review, the 12/30/16 payroll was not deposited until the beginning of April? We are preparing the 5500 for the ER to sign. What is our exposure if we do not indicate late deposits because we are filling out those questions per the client's direction?

That sounds like it would be fascinating reading...

Let's not get hasty... ;)