chc93

Never heard of this yet. I just went to the efast.dol.gov website, and didn't see any indication of this change to the log-in process. If they already have links in an email, I would think the website will at least have information of the change.

Unfortunately, I think that ship has sailed... One client sent us the 5558 denial letter this morning. Our files show that certified mail with return receipt was mailed on 07/25/2022. The green return receipt card showed the IRS "Received" stamp as 09/22/2022. USPS tracking shows the envelope was received at the local USPS Regional Facility on 07/25/2022 (agrees with our files), then received at the next USPS Regional Facility on 07/29/2022 but didn't leave that facility until 09/07/2022. Then, delivered to Ogden UT on 09/10/2022... to be finally stamped by the IRS on 09/22/2022. So maybe the USPS is as much a problem as the IRS?

Hopefully by the time extensions for the 2022 plan years roll around, the proposal to file the 5558 electronically through EFAST2 will be implemented. Comment period ended Dec 5, 2022. I am hopeful... 2022-21584.pdf

Only issue with signing and mailing is that if the sponsor files more than 250 tax forms in a year, then electronic filing is mandatory. Suppose you fall into the mandatory box... you mail in a paper form... IRS says you must file electronically... you electronically file on Jan 6. Are you OK then?

We had this happen recently. Separate cash balance plan account and 401k plan account... but both under employer EIN. Worse, neither account reflected the plan name (cash balance or 401k). Applied for TIN for each plan. Sent client's authorization letters (one for each plan) to brokerage firm with full plan names and corresponding TIN's. Two new accounts were created, and assets moved from the old plan accounts to the respective new plan accounts. Seemed rather painless...

This happens every year about the same timeframe.

I'm not sure about reducing hours requirement for vesting retroactively. But maybe amend the plan now to provide 100% vesting immediately... should help to keep them around... especially since he plans to sell the practice soon, and assuming he terminates the plan, they will have to be 100% vested anyway. And sounds like he wants to fully vest everyone when he sells the practice. Note that selling the practice doesn't require 100% vesting... but terminating the plan requires 100% vesting...depends on the how the practice is sold.

Maybe do an in-service distribution (if the plan allows) but still set the plan term date as 12/31/2022 to get the income for the year.

Probably a good idea to explain why invoice is less than estimated range. Then if future invoices are "within range", may make more sense to client. Then especially if additional work is done and invoice is more than the estimated range, the explanations may be more easily accepted.

usually full vesting is required at normal retirement age...

I agree with CBZeller. Generally, DB plan documents we work with have excess to revert to the company. This is necessary if any excess will be transferred to a QRP. But then, we could always amend to allocate excess to participants (I think I have this right).

Well... hopefully this 5558 problem goes away by itself. There is work in progress to allow 5558 to be electronically filed through EFAST2. 2022-21584.pdf

Yes... as far as I know, the distribution election form is only good for 180 days after execution.

I agree with SSRRS. The 2022 RMD is based on the 12/31/2021 balance, and doesn't change for events occurring after 12/31/2021.

No idea... maybe the subs can be employed by the owner for the time that they work for the owner? So "part-time" or "on-call" employees that are allowed to participate in the owner's 401k plan?