Lou S.

ADP is a bright line test, you pass the math or you don't. Whether or not that is reasonable or equitable isn't really considered by the math. I'm sure the IRS would say - if you have a low pay owner deferring the max, SH is an option. You also might consider testing on comp from date of entry which might cut your QNEC roughly in half.

I don't think a QNEC to pass ADP/ACP is limited by 402(g), only 415. But I'm not sure what an equitable solution would be is you took this to VCP.

I could be wrong but I think what his is asking is assuming max compensation and funding for a maximum 415 benefit at retirement age, what is the annual level funding using reasonable actuarial assumptions given an employee's current age and future retirement date.

I don't think you need to change either but the question then becomes is it eligible for rollover and subject to the 20% mandatory withholding if before the date stated in the regs?

Generally yes. See Rev. Proc. 2017-56.

What? New "forfeitures" in a DC plan simply are internal transfers from the participant account to a plan holding account. They are not a distribution, contribution, or income. If forfeitures are used to reduce employer contributions from the forfeiture account, you would reduce contribution shown by the forfeitures reallocated.

I've never done it but I think the fix involves VCP with requested return of the ineligible distributions from affected participants. I'm not sure what happens if you are unable to recover the funds. That is the participant says no I'm not returning it, I already spent it, or something like that. For taxable payments to employees my best guess is the IRS will simply let it go if you make good faith effort to recover, for funds that were rolled over to an IRA they would probably want those treated as ineligible for rollover (unless there was another distributable event) with amended 1099-Rs if the funds are not returned.

ADEA?

I missed that it was $5, I thought it was $5K. I mean technically my answer is still correct, but I'm not sure I'd go through the trouble for $5.

You have a late deposit to the 401(k) Plan. Deposit the additional amount along with earnings to the trust. If the trust is closed, they may have to go down to a bank and open an account in the name of the Plan. I'd first ask the original custodian if they can and process the deposit and issue a residual distribution for the employee.

Why isn't state unclaimed property the answer? Is Plan forfeiture an option under the document with restoration if kin can be found? Is a check payable to the estate an option? That would probably require someone to open an estate.

Then why are you asking here?

The Plan Sponsor simply needs to maintain a copy of the tax return extension in their files and produce it should the IRS request it.

Contributions to the plan depending on the terms of the plan document could include any of the following sources and I may be missing some: Employee: Traditional 401(k), ROTH 401(k), Voluntary After Tax, Rollover Employer: Matching, Safe Harbor Matching, Profit Sharing, Safe Harbor Non-elective, Qualified Non-elective, Qualified Matching, Prevailing Wage. You might also have ROTH conversion sources for the sources above if the plan allows for in-plan conversions, rollovers or transfers. All of them might have slightly difference rules that they need to follow with respect to vesting, timing of deposit, and withdrawal eligibility. Your TPA should be able to help you out with specific questions about your plan.

If the client is setup as the Administrator on the PBGC site, they can grant you access by inviting you. If the prior TPA did everything you might need their assistance. As for the premium, if it's a small plan using the lookback, the premium might be high since the interest rates lag what's been going on.

See instructions to Form 5500, you can if you meet the following conditions. An automatic extension of time to file the Form 5500 Annual Return/Report until the due date of the federal income tax return of the employer will be granted if all of the following conditions are met: (1) the plan year and the employer’s tax year are the same; (2) the employer has been granted an extension of time to file its federal income tax return to a date later than the normal due date for filing the Form 5500; and (3) a copy of the application for extension of time to file the federal income tax return is maintained with the filer’s records. An extension granted by using this automatic extension procedure CANNOT be extended further by filing a Form 5558, nor can it be extended beyond a total of 9½ months beyond the close of the plan year. Note. A tax-exempt organization is not required to file a federal income tax return. However, if the organization uses a Form 8868 to request an extension for its Form 990 series return, the filer is automatically granted an extension of time to file the Form 5500 until the extended due date of filing Form 990 series if all conditions listed above are met. An extension granted by using this automatic extension procedure cannot be extended beyond a total of 9½ months beyond the close of the plan year.

Assuming the plan doesn't currently allow for discretionary match I would assume they would need to adopt the amendment before they started depositing the matching contributions to the plan but not later than the end of the plan year for the discretionary amendment. That said, if they did start depositing the match early, I think the eventual amendment would most likely work as a self correction under the newly expanded IRS rules.

Company B can have it's own plan. They are a controlled group so you need test everything together and you have one 401(a)(17) limit and one 415 limit if you have any employees who wide up working for both company A & B. I think you may also have one 401(k) test, but I could be wrong on that. So yes but some extra testing.

Someone probably copied the prior payroll without checking the current one.

Wow that's a good question. I would assume absent specific guidance the 2022 audit would be required to be attached to the 2023 return since the 2022 audit is just being deferred under the rule. That is it is still required. And the audit relief for plans under 100 accounts is applicable to 2023 and does not go back to 2022 as far as I can tell.

Not this year, but I've seen similar in past years. But it is usually with non-calendar year getting an extension only to the calendar year extended date. For example I often had a problem with 1/31 year end getting a reply from IRS saying that the extended due date was 10/15 instead of 11/15. But I haven't seen your example where the IRS grans and extra 6 months.

Adoption of a "New Plan" is the creation of a Plan that didn't previously exist. Adoption of a "Plan Amendment" changes one or more terms of an existing Plan. Adoption of a "Restatement" is a type of amendment where the terms of existing document are replaced by a new Plan document. This is most common when IRS requires a restatement due to various law changes (right now that is about once every 5 years for pre-approved plans) or when you change plan providers who require you to restate to their pre-approved document for continued reliance on an IRS Opinion letter. The Restatement may or may not make substantial changes to the terms of the existing plan document. A restatement does not create a new plan.

Wow, what a needless over complicated provision for such a small amount. Couldn't they just say - If you have an emergency you can take up to $1,000. If you do so you can not do so again from the same plan for 3 years. All the extra stuff is just screaming to mess something up somewhere.

It fits into the rules but can be problematic if you hire new employees who are not eligible in the "near" future like until after the next plan entry date under the Plan's regular eligibility rule.

Did the Plan's attorney draft the amendment to specifically exclude participants/employees not employed on the adoption date?