Chippy

My current plan has 3 participating companies, all part of a controlled group. The plan sponsor and two other companies. The sponsoring company and one of the participating companies was sold, with one company remaining. Can I amend the plan so the remaining company becomes the plan sponsor?

Employer had two late deposits during 2017. If they correct it on their own, and deposit lost earnings, are they required to file a Form 5330 with the excise tax?

I read them, so it sounds like the employer would contribute a pre-tax contribution to the plan based on the student loan payments. How would these contributions be tested, in the ADP test? Would the employer report them along with the payroll 401(k) deductions? I have a client that is interested in this, they think it is a matching contribution, but again, how would it be tested? Was wondering if anybody used this and how it worked.

Has anyone ever heard of Student Loan Genius? They say employees make their student loan payments and based on a payment, the company makes a pre-tax contribution into the employee's 401(k). I was just wondering how this would work and if anyone has any experience with it.

Top heavy implications? There are no key employees in Plan 2 that will add the match. Before the associate makes partner, they are transferred to the Partner plan. I always thought that each plan was tested separately for top heavy. Is that correct?

a law firm has two 401(k) Plans, plan 1 is for the Partners and Staff, Plan 2 is for the Associate Attorneys. Plan 1 has deferrals and Profit Sharing (NEw Comp) Plan 2 has deferrals only. There are HCE'S in both plans, and the plans have always passed coverage They would like to add a 2% match to Plan 2. As long as it will pass coverage, is this allowable?

I have always used the Up-84 mortality table when doing cross testing on a New Comp Plan. My plan is failing the average benefits test slightly (69.89%) I noticed in the administrative system that I use, there is a table called 2017 417 (e) (3). If I use that table the Average Benefits test will pass at 70.20%. The plan document does not state which table to use, so, Is it ok to use this table when running the test?

I'm torn to suggest forfeiting because of the small amounts. The IRA's if set up will go to zero in a few years due to fees, so in the end the participants probably won't get any money anyway. This has been dragging on for a few years trying to locate the participants.

I have a terminating plan with 4 remaining participants, none of which can be located. The recordkeeper will not set up an IRA for them without a address. Can anyone recommend a rollover company that these participants balances can be put into and the plan closed? It's 4 participants and $361 total between the four. Each participant has less than $100. Any other suggestions on how to get this plan closed?

Is the date they file under DFVCP the date they file the 5500 or pay the fee?

An 8/31/2016 5500-SF was never filed. Client received a letter from IRS letting them know it was never received. . They are going to file it today, under DFVCP. The letter gives them the option of filing under DFVCP, and it asks for the date applied. What date would they put in there when replying? The date the 5500 was actually filed? Also, do they pay the fee right away, or do they wait for a reply from the DOL? Thank you, this is the first time for filing under DFVCP.

A participant terminated during 2017 with 700 hours, he is 0% vested. He is eligible for a profit sharing contribution for 2017. Forfeitures are reallocated the same as the contribution. Document says forfeitures occur in the year they are paid their vested balance. Since this participant is entitled to a contribution and forfeiture reallocation for 2017, does he also forfeit his balance during 2017? I'm thinking his balance should be forfeited in 2018.

Yes, he has. He was 70 1/2 on 12/3/2017 and retired as of 12/31/2017. His RBD is/was 4/1/2018. The participant just flat out refuses to take the distributions. I advised the plan administrator to issue a check but the participant he has no intentions of cashing it and will take his RMD from the IRA during 2018. Not sure what else to do. The Plan Administrator has documented it.

Thank you. I agree, but the participant is just flat out refusing to take the RMD before he does the roll over. He retired as of 12/31/2017 so he must take it. So the plan administrator can have a check sent to the participant with out his consent?

Can a participant rollover their entire balance to an IRA and then take their RMD from the IRA? I told the participant they have to take their RMD and then roll over the rest and the participant is adamant that he is not taking a cash distribution from the retirement plan. I had thought that the RMD must be taken first and the remaining could be rolled over to the IRA. He even said he called the IRS and they told him he did not have to take the RMD from the Retirement plan. Maybe I've been misinformed all these years?

401(k) Profit sharing Plan, new comp. Doctors max out, staff gets minimum. They currently deposit the 3% safe harbor with each payroll and would like to do the same with the profit sharing. Anything negative with doing this? No LDR, or hours requirement for P/S. If they do this, for the HCE's that max out, would it be better to divide the non-elective P/S that they will receive and do that per payroll, or to contribute the percentage each payroll and stop when they hit the max. I've never had anyone that wanted to deposit the P/S each payroll.

I was just informed that this person's last day was on Tuesday. They still have to give this participant the missed contributions? correct?

No. There is a new person at the company and she sent me the 12/31/2017 census and included this participant. This is the 3rd contact for the plan in 5 years. When I asked why she was never on the census prior, she had no Idea and couldn't find a reason why. She is part time, but had over 1,000 hours in each plan year. She also did not receive a profit sharing contribution in each of the years.

Plan has immediate entry for deferrals. A participant was hired on 9/17/2013. (2/28 PYE). Switched to 12/31 pye at 12/31/2014. 2% initial deferral, no increase. They have never included this employee, so have to make up for 2/28/2014, 12/31/2014, 12/31/2015, 12/31/2016, 12/31/2017 and January and February 2018. Is the missed Deferral, 2% or do I use the ADP and give them 50% based on that? Never had this with automatic enrollment. Thanks

Back in 2008 a pension plan was terminated and some of the participants elected to rollover their balance to the 401(k) Plan. Now in 2018, a participant wants to rollover their prior 401(k) plan to this plan and it is realized that the plan does not allow for rollovers. Is it as simple as amending the plan now to allow for rollovers, or how do we fix those rollovers from 2008?

Thank you.

A shareholder is creasing to be a 5% as of 12/31/2017 and will continue to work at the company. He turns 70 1/2 in 2018. Since he is not a 5% owner in 2018, is it correct that he does NOT have to start taking RMD's from the plan until he retires?

Thank you Tom. That's what I thought, just like confirmation.

Plan uses Rule of Parity. Exclude eligibility service before a period of 5 consecutive one year breaks in service if an employee does not have any nonforfeitable right to the account balance derived from Employer contributions. Does not have a one year holdout. The employee is eligible to enter the plan on his rehire date if vested when terminated. My question is, is there a limit as to the number of years an employee is gone from the company so that his prior service will not count for eligibility? Employee is terminates in February 2005 and was 60% vested. He is rehired in 2014. He was gone for 9 years. Can an employee be rehired after 20 years and will that prior service count?

Do you see any problems moving them to use the Top Paid Group election? Coverage isn't an issue, but they do have problems passing the ADP test. The associates plan has quite a few HCE's and most do not participate. I ran the ADP test with the TPG for 2016 and it would have passed.