HarleyBabe

UPDATE 11/13 - Letters coming now saying IRS needs more time to evaluate. Unbelievable part is I've received 3 letters from clients who had received the denial letter and each of these followup letters have the wrong tax period listed. All three have different tax periods. One of them has the tax period as the date the extension denial letter was received. What in the world is happening in Utah!

Funny our denial letters stopped coming. They were 9/16 & 9/23. Nothing since. So did they catch their issue or do more come. Was expecting a grouping on the 9/30 based on pattern. Hope we have answers or something soon to provide clients.

Good question, I've already got angry clients like we did something wrong so then charging them, even though it's been so time consuming responding to every letter, and not our fault, is a tough call. I'm hoping the IRS comes out with some blanket statement because I KNOW the Efiled returns will prompt another auto generated letter now saying they are late because of the extension denial. Just want this to all go away so I can not dread checking my email everyday for more denial letters.

Well, I'm comforted to know it's not just me. Frankly I'm shocked my entire package of client extensions has not received the letters or if they have clients haven't sent them to me as of yet. Up to 15 so far that I am responding too individually. My clients are well aware of the situation because I have been communicating weekly asking for them to send me the letters and not sit on them and I've only received 15 so far, so could it be that 15 of my 46 were the only ones received? No clue!! Please Craig keep us posted on here or I may email you separately just to establish communication in regards to this issue.

As I just told Kelsey in Government Affairs, I've received 15 from clients to date. My package actually had 46 in it not 60. One day I received 5 or so with the same date, the next time again 5 or so with the same date, like they are going out in groups (the IRS letters). I have asked all my clients who were extended to please check their mail and not to sit on any IRS letter so I'm surprised I haven't received more. Not sure if this is the client not sending them to me or whether just a group of mine got separated from my package in Utah. Just don't know. Our actuary on the West coast has told me that he has heard many actuaries are talking about this so maybe on another message board. Seems to be more than you and I Craig.

As I just told Kelsey in Government Affairs, I've received 15 from clients to date. My package actually had 46 in it not 60. One day I received 5 or so with the same date, the next time again 5 or so with the same date, like they are going out in groups (the IRS letters). I have asked all my clients who were extended to please check their mail and not to sit on any IRS letter so I'm surprised I haven't received more. Not sure if this is the client not sending them to me or whether just a group of mine got separated from my package in Utah. Just don't know.

This is the date my first letters started arriving from clients - dated 9/16

Craig my letters started coming to clients dated from Utah on 9/19 and then 9/23 and 9/24. CORRECTED - 9/16 my first denials were dated!

Wondering if I should write to the EP Accounts Division with my entire list of plans and EIN numbers with what I have which is only the charge at USPS and the printouts of the date I generated the Extensions and ask for research and abatement OR should I take one at a time and send in my letter with the filing in the EFILE system as the 800 number told me to do that was on the letter. But they also gave me the EP Accounts Division address if I wanted to reach out. I didn't get a whole lot of direction. Any advise would be much appreciated as on 9/19 this is the last worry I need. Thank you.

Two more clients just received the letter. I feel sick. Yes I'm going to respond as I normally do when I Efile with a separate attachment and hope I don't hear another word about it. I'm wondering with the new extensions and the process they were going to be accepting Efile and then not, if maybe I'm not the only TPA receiving these.

We sent all our 5558 extensions in one package for 12/31 on 7/30 as we always do. About 60 of them by priority mail on 7/30. Today one of my clients received a letter stating they were denying the extension because it was received late. Here's my issue, I can't find the tracking receipt ANYWHERE. It was on my bulletin board and now just vanished. Sooooo was it just this one that got separated or my entire package. I have two things, one my bank statement that shows my charge at the Post Office on 7/30 as well as the screenshot of where all my clients needing one were generated on 7/30. I tried going to the Post Office to see if they could back track and provide my tracking number but some new person was there and I have to go back and speak with the Postmaster. At any rate, has anyone had this happen? and do you think they'll accept what I have noted above to abate any penalty considering we have never filed a late return or extension. I am praying this is a one off and that it just got separated from the package. I've had plenty of instances over my 30 years where they say they haven't received the extension, I've sent it in, and never heard another thing and never included tracking, just sent it to them. Thoughts? Anyone else receiving these notices so far? Would you do anything else other than respond right away with what I mentioned. Thanks!

Hello All - would like to have a regular advisor email list to send out newsletters too, especially with Secure Act changes. Is there a particular company that is better, to one, purchase the list for certain areas and two prepare the newsletter with input from me and perform the service of the email blast? Thank you.

Thank you. I thought this the case I was just hoping maybe I was missing something.

Morning all - have 403(b) plan that failed ACP. For a variety of reasons the refunds were not made to the HCES within the 12 month period after the year in which the failure occurred and the CPA audit picked this up. Keep in mind for 2023, they wouldn't be required to audit because of the new rules with participant counts and balances. From what I am reading, it looks like correction is make the distributions, which has occurred, but then you also must provide a QNEC to "ALL" NHCEs eligible to defer. BIG problem. That alone throws them into an audit for 2023 because participants who 0 balances who we could normally exclude from the participant count will now receive like a $ 20 QNEC and now have a balance. SOOOO help, am I missing something? Advice, suggestions. Anyone else read it other than ALL must receive and maybe just those who would have received that year. This is one of those crazy cases where one thing leads to something much worse. Next question, maybe I can figure a way to pass ACP after all. Is shifting allowed in the 403(b) from ADP to ACP. If so, how would that work. ADP isn't required to be tested so can I shift as much as I want to ACP and therefore it would most definitely pass. Any thoughts would be so appreciated. Thank you.

I'm looking for some direction, response, something to point me in the right direction. Currently have a 401(k) that due to a change in ownership has resulted in an Affiliated Service Group situation. Confirmed ASG. Therefore, we must test the two different companies owned as one. Coverage will fail. The HCE/owner who is my client is willing not to participate so that coverage will pass but we need to find something appropriate outside the plan for savings purposes for him. I need options. Thought of non-qualified immediately but it's an LLC and he's a partner so my understanding is that there would be no current tax deduction for him. Can someone suggest other options for this employee outside of a qualified plan? Thank you.

Coming to the experts. Need to avoid coverage issues for my new AFG. One 20% owner participates in the plan that my firm administers. Originally I thought non-qualified outside the as our ERISA counsel suggested. This is an LLC though taxes as Sub S I believe. I'm now being told not going to work if they want the current tax deduction. What are my options for this one employee to avoid the coverage issue for tax deferred savings?

One of my clients is adding Union employees to the company. It will take them over the 120 count. Was wondering is there a way to set a separate plan to avoid this. Although the same owner will own the company although he doesn't participate, still a controlled group because of it, so I'm thinking no but am I missing a way to avoid this? BTW it's a plain vanilla 401(k) plan.

Help! Currently have the following: Current client Partnership with a 401(k) Safe Harbor Match plan, 2 other companies merged into my current client to become one company. The two other companies are going to keep open their S Corps for pay purposes. We will have 3 equal partners now. One of the other companies has a 401(k) plan. We want to either terminate or merge that into my current clients and then amend my current clients plan into whatever we redesign. My question is should we terminate that other plan or do we have to merge it because the other owner is keeping his S corp open?

If anyone from Relius is actually moderating this today, what is going on with ASP and Comcast. Our IT person just said it's not our network. This is an ASP issue. It's a weekend and it baffles me that their is no support on the weekends prior to deadlines. Hello??

Can't get in the website, anyone else?

What the heck - are you all down?

All - Ilene in particular - so I hear what you are saying on the ADP and makes total sense. I'm reading EPCRS examples and verbage for correction and it says you can perform the ADP testing prior to the correction of excluded employees......that being the case, they were all excluded and therefore no NHCEs so no testing issue. I mean technically if I go by what EPCRS states unless I still should include them with 0's. It doesn't say that though so I'm still perplexed on what to do. If I give them enough to pass testing period and just go that direction, we're talking 30% QNECS for a bunch of employees for a couple years. Suggestions?

Thank you all

The first employee hire was 2017. No this is not a Safe Harbor. Just a plain vanilla 401(k). No match.

Hi All - not sure where to start with this mess! Have an employer who failed to notify their employees that they were eligible for the 401(k) Plan. They thought they had an owner only 401(k) plan (so they say!). I'm trying to determine the steps now to correct. I've reviewed EPCRS. I'm having trouble determine the corrective contribution because no NHCEs were able to defer so I have no average to give them and I can't find a default percentage when this occurs. Someone told me 4% but I can't find that anywhere. Also, of course now we have ADP testing every year since 2017 and there will be corrections for that and because it's been 12 months since the correction, there will be corrections for that. Add to that the tax form filing. I feel like there is a building block of contributions and penalties that will be due. The filings or non-filings I know how to handle. I guess I'm looking for some direction on is there an overall way to correct this or will I just need to go piece by piece and add it all up. Suggestions as to how to handle and is the 4% per year per person the correct default QNEC to provide? Thank you.