BG5150

Yes.

this

Is that non-owner an economic engine of the firm? Is he or she an HCE? Maybe the owner wants to keep costs down, but also reward someone for a job well done.

Is something like that truly deductible under 165? (is that the number?)

Tell them to read their plan doc before posing a question. ;)

Relius and divisions, FTW.

In this case, I don't think I have much of an issue. Owner deferred $2,500 and the PS will be $3,000. So I'm under 402(g). And the plan is all HCE, so no ADP test to consider. However, I'm interested in the answer, as my knowledge of deemed CODA is lacking. As TPA, what might be my responsibility here? I have it in black and white that an owner wants to reduce his PS so he can get a bigger bonus. Do I mention it? What IF it affected the 402(g) limit and/or testing? Do they need an attorney to review this? An accountant?

TPA

We have a company that is a P.A. One of the owners is asking if he can take a smaller Profit Sharing so he can get a bigger bonus this summer. Is that a deemed CODA?

Lou, I thought about that, but you still have payments that need to be made. How do they get treated? Do they create basis now?

How is it any different that a "regular" plan. In those, the plan still owns the assets, though they are earmarked as benefits for Mr. & Mrs. Jones later. What if the sole investment is 1200 shares of the ABC fund? Who is the owner of those shares?

Won't a lot of these plans be 1-participant plans, and thus no bond needed?

^ That was my first thought.

Certainly has been a while!

My question is an operational one. In Relius, say, she will have an account balance of $1,200 at zero percent vested, even though $200 of that needed to be vested b/c of the 11(g) amendment. Who is going to remember 3 months later when she asks for a distributoin? Do you put that $200 in as a QNEC? It's not, and, to me, it should have the same restrictions as PS money.

[sarcastic]put it anywhere and let the auditor tell where to move it to[/sarcastic]

If it was 20 years ago, I don't think the loan could even be made. When did they change the rules to allow owners of S-Corps to even take loans?

Nice. Seven bucks for a $10,000 investment for a year.

The DoL is getting better at checking those "note" attachments. Be prepared for a letter saying the revised form and audit needs to be filed in 30-45 days (from the date of the letter)

Is it a 1-participant plan? If so, and they prepared EZ's, you won't find them online.

^ so If I had a $10,000 balance included in the TH calculation for 12/31/16 and I had a SH receivable of $3,000 and a PS receivable of $1,402, my account balance for the TH test would be $13,000?

I think Relius lets you get away with 4.402% or a 1.402 gateway after 3% SH.

Open with 2015 5500 closing balance and put the difference in 'Other Income'

If more than 15% it's more than 1/3 for gateway. You are probably thinking of a SH plan, where everyone is getting 3%. If owner gets more than 9% total, the staff will get more, up to 1/3 of the owner's % for gateway. If owner is more than 15%, you stop at 5%. Again, just for gateway.

Sure. As long as you are passing coverage using the 70% ratio test. PS: What percentage is the owner getting? If more than 15%, then you have to give just 5%, not necessarily 1/3 for the gateway. (Side note: if you are passing rate groups for the contributions, you do not need the ABT)