Kimberly S

That is a good start. You've identified the testing population. Within that population you now divide them into (1) those who would still be on the list if the plan's eligibility and entry were the maximum allowed by law, and (2) those who are "otherwise excludable". The two subgroups are tested as though they were separate plans.

For the moment, ignore the entry date issue and focus on a more clearly defined piece of the puzzle. Your plan is more liberal than the statute because it allows people in at age 18, and the statute says you can make them wait until 21. Anyone in your plan who is 18, 19 or 20 can be excluded from the test because you didn't have to include them in the plan and therefore should not be penalized because you were generous and let them in. Does that help clear up the concept of carving out certain people? FWIW, testing by excluding "otherwise excludable" employees is an industry standard, albeit with some questions raised above about exactly how to define that group.

I think the part you're missing is that paying yourself 6% instead of paying to the bank may cost you 10-11% (stock market historic returns) that another investment would have earned in that time period in the market. Either way you are paying 6%, but the earnings potential is very different. Of course, 6% interest the past few months looks pretty terrific compared to the market.

And I supposed it also comes on some sort of psychedelic paper in a gold plated binder!

A client called with a bizarre situation. It seems they thought they had terminated our services and moved their plan to another provider in 2006, although we have no record of such a request. Apparently they now have assets with 2 providers and they are not clear if they have 2 plans or if the new provider restated our plan and just dropped the ball on transferring the assets. The EFAST hotline shows receipt of the 2006 5500 for plan 001 and nothing for a plan 002. FreeERISA shows the form that we prepared for 2006 and nothing else. If the new provider prepared a form for the assets they hold using plan 001 that the client filed along with the one we prepared using plan 001 for the assets that we hold, would both of them show up on either EFAST or FreeERISA?

Given the current focus on fees, index funds often sound very prudent indeed.

...or in some cases quarterly or even annually.

The exemption applies only to owners and their spouses, not their children.

Back to the above question: yes, if the only people with money in the plan are key employees, the plan is definitely top heavy. However, if the only contributions in a given year are salary deferrals and the safe harbor contribution (ie no discretionary match or profit sharing) then they get a pass on the top heavy minimum contribution.

It's usually specified in the adoption agreement.

Although quite different topics, I agree with both P MacDuff and Jevd.

Apparently he was better at managing his own receivables than administering a retirement plan!

Is there anything in the loan documents that says they can't or that the loan is immediately due in full upon termination?

Kim, I'll gladly give you yet another pay cut to come work for me! Bill, It's hard to pass up such an offer, but I'm concerned about commuting costs from Kansas!

It's not as unusual as you might think. I had a plan some years ago where the participant wanted the distribution sooner than the plan allowed in order to pay an attorney to defend her against the embezzlement charges. Said defense attorney is reported to have told her that the employer could distribute the money sooner than what the document said if he wanted to.

Financial aid is usually based on the prior year's taxable income. A 1099-R that doesn't show a rollover, increases taxable income. A larger interest in other assets, such as the marital real estate, does not increase taxable income.

Glad to hear that you agree with what I've always understood. The questionable attorney (working for a brokerage firm home office) was on a conference call with me and the client, contradicting what I had just told the client. Since I am NOT an attorney, I quickly back pedaled and suggested that the client consult their own attorney.

I've heard one attorney argue that anyone employed at the time of the amendment cannot be "cut back" even though they are not yet a participant because they were promised the old benefit when hired. I've heard attorneys whose judgement I trust argue differently, but it's worth considering.

I suspect the data has wide ranges because of the wide variation in how TPA firms are operated. I've spoken to people whose case load was one or two large plans and people with similar industry experience whose case loads range from 75-200 smaller plans in full service firms. I moved from a full service firm with a case load of about 100 plans to a self service, bundled provider we do not have assigned caseloads -- everyone works on any plan in the shop. We have over 700 plans per administrator. And everyone here took a pay cut when moving from the full service TPA environment.

That would be the same group who wants to know how much money they personally have in the plan each year.

I agree with David. If they were to follow Mike's suggestion, it would likely end up structured as alimony that would still be taxable to her. Why would he want to pay the tax?

I have no idea how the cost compares to Relius, but if you don't mind a DOS based program, Larry Deutsch Enterprises has one.

As the sponsor of such a plan, what you suggested makes sense to me. As a plan admininstrator, I've not encountered this situation, so I'm not positive.

The adoption agreement should specify the sources available for hardship.

95% is impressive. Apparently we aren't charging enough!