Francis

Even if an employer learns what it believes to be the new mailing address for a terminated employee with a balance, doesn't that participant have to (must) take action to provide instructions to the employer or recordkeeper to change their mailing address? Otherwise, there could be privacy violations, etc.?

Thank you!

Can an investor with a real estate investment LLC but no "earned" income establish a solo 401(k)? The 401(k) would receive rollovers to be invested, but no contributions unless there is future earned income. Is establishing and rolling into a 401(k) allowed, even if contributions aren't?

Have there been any updates to procedures on the topic of a plan merging Jan. 1st and whether the 5500 for the previous year could be the last one and marked as final? Two plans merged 1/1/22 on paper, and all assets moved from the sending plan 1/4/22 (first business day of the year). The account statements for the sending plan show the entire plan balance intact on 12/31/21. Since the merger date was 1/1/22 and no assets moved until 1/4/22, is there any reasonable way to mark the 5500 for 2021 as final and not file a 5500 for 2022?

Seems the beneficiary would claim all of the plan assets, and that would empty the plan. Next step should be to file a final 5500-EZ and that should do it. My guess is the executor could sign the 5500-EZ.

Probably a made-up SSN and computer-generated SS card. The process could be similar to how I bought beer at age 17.

Thank you. Lack of a proper SSN does seem to be the issue. We'll investigate the possible solution you provided. I appreciate it!

Employer needs to make a SEP-IRA contribution, and an employee is unable to open an account to receive her contribution because she could be undocumented, and that's blocking custodians from opening an account for her. Any idea what the employer should do if a custodian won't open an account to receive the contribution?

My view is an ERISA 403b is almost always better because it is not subject to the ADP test. There are fewer recordkeeping options available for 403b plans vs. 401k plans, but there are enough good ERISA 403b plan options for most non-profits to find one that's a good fit.

Would an acceptable workaround be for the Employer to provide let's say a $120 Profit Sharing contribution to every employee as of 12/31 annually. Although it would be Profit Sharing, in a roundabout way it would reimburse the past 12 months of fees. Terminated participants wouldn't receive the Profit Sharing. The $120 would be tested, but would probably pass since it's a level amount, or that's my guess.

For a closed solo 401k that failed to file a final 5500-EZ when it was due 18 months ago, we filed a final 5500-EZ and included $500 under the "Delinquent Return Submitted under Rev. Proc. 2015-32 Eligible for Penalty Relief" program. We never heard from the government after filing, but they did cash the $500 check.

Recordkeeper is requiring a new QACA 401k to add a 2 month eligibility waiting period for new hires so they can distribute notices to them. Is this correct or is it possible to implement a shorter eligibility period such as 30 days? Since QACA allows an employee to retroactively opt-out, it seems a lengthy notification period isn't needed, but maybe I'm wrong and the recordkeeper is right. I couldn't find IRS guidance on this.

Thank you. Yes, the two companies have more than 50 employees each so that appears to meet the QSLOB size requirement. I'm not familiar with QSLOBs (fairly complex at first glance) but I'll take a closer look.

Two different employers run separate 401k plans under a controlled group and the transition rule is ending soon. Is it correct that if the plans continue to operate separately, they won't be pulled together at all for testing purposes if the plans independently pass testing on their own? If yes, it seems both could be Safe Harbor with different matching formulas and could stay separate and pass all testing. Too good to be true?

The 2019 Form 5500-EZ asks for the Total plan assets at the End of the year on line 6a column 2. The 12/31/2019 account statement shows a 12/31/2019 value of $300,000. In February 2020 a $17,000 contribution was added for the 2019 plan year. Should 6a column 2 show $300,000 or $317,000 for the End of year value?

Does anyone have any idea of the dollar amounts when it comes to IRS fines should an employer have unsigned or missing plan documents? Would a $1M plan see IRS fines of maybe $500 or are we talking $10,000 or more?

I appreciate your very good ideas. They will search the corporate minutes and old files. Possibly the "can't be bothered to really look" is the case. I'm surprised some recordkeepers don't maintain signed documents. It seems some do and nicely organize those within a client portal and with others maintain nothing.

If an employer can't find signed versions of its PPA restatement documents and the recordkeeper does not maintain signed copies, are there any suggestions of what to do? Surely the documents were signed within the 2014-2016 required time period but they can't be found. The employer has the unsigned versions. Could we just sign and date on the day they were likely signed in 2015 and put those in the file?

Two 401k sponsors have received calls from the Wharton Group about a new DOL requirement for a third party 5500 review, which they are offering to provide. Is this a scam or has DOL implemented a new rule to require a third party to review 5500s? Employers in question have 25 or so participants.

Employer was 20 days late with employee deferrals, matching, and non-elective QACA contributions. Prior to this error they have always submitted the three money types together to participant accounts every pay period. For the missed contributions do they need to use the VFCP lost earnings calculator for all three money types or just for the employee deferrals?

An S Corporation with the same person as sole owner and only employee has a Solo-401(k) that's been in place for a two years. (1) Can employee deferrals and employer contributions to the Solo-401(k) be made after 12/31 but before the owner/employee files her tax return? (2) Also, does the W-2 for the owner/employee need to document the elective deferrals?

"Have the sole prop adopt the existing plan and the comp from both are aggregated for plan purposes" How does the Sole Prop actually go about adopting the plan of the LLC? Doesn't it happen by default or are there specific actions or documents required to make it happen?

I suspect the answer is "No" but employer has a SIMPLE IRA with 100% matching up to 3% of compensation and their match is deposited in a lump-sum after the year concludes. They would prefer to not add matching dollars to one former employee's account. The former employee was terminated for cause and has violated his non-compete. Is there any way for the employer to not add matching for this one former employee where hard feelings still persist?

Is it okay to not send the annual Safe Harbor Notice to non-employee participants? It seems non-employees don't need to receive it but we've always mailed it to everyone with a balance. If there is a DOL audit we want to be sure to have sent out all of what was required.

Thank you! You've be super helpful.