Lou S.

Do you have any other traditional IRAs?

I'm not a lawyer but is there a provision in the trust that allows it to be disolved and would the Trustee agree to disolve it? It may be a form over substance issue where the payments have to continue to go to the Trust even though they then pass directly to the grand kids.

Can they pay a portion of your fees with the residual dividends in January and show it as a payable on the final 2020 form 5500?

Unless you opted into electronic notification point out specifically that the first time you were notified was the bill collector as you have no prior written communication from them. Ask them to indemnify you from any losses, taxes, fees or tax preparation services you may require as a result of their error. Also require them to removed the bill collector and ANY negative reporting to your credit that may result from them having sent this to collections without notifying you in writing that the error had occured. Tell them while you are happy to return any funds erroneously deposited to your account to the Plan, you will not be dealing with any bill collectors on this matter. Also you will need a detailed accounting of how they arrived at the over payment figure in question and why you are not entitled to that payment. If they do not agree let them know that your next call will be to the local branch of the Department Of Labor.

If she was an employee of the husband's business wouldn't that be a controlled group by stock attribution because as a spousal employee should be be deemed to own 100% of husband business as well as 100% of her other business? But he said no CG so I assume she is not employee. Assuming the wife has no direct ownership of husband business, is not an employee (and same goes other way) and there are no GC or ASG issues I see no reason why wife can't maintain SIMPLE-IRA for her business while husband has 401(k) for his.

CB I guess that is another way to look at. We've always taken the conservative approach that the 30 day notice period was to designed by the IRS to allow participants time to change their deferral elections if the removal of the SH match caused them to reevaluate their position. But I can see looking at this as an amendment before the year starts and not a mid year reduction and thus not being held to the 30 day notice rule.

If the loan is on extension then is it in default? Did the CARES Act. specifically prohibit a loan offset as valid CARES Act. withdrawal? I think those are the questions. I believe the answer to the firsts is clear that the loan is not in default prior to 12/31/2020 if it was properly suspended under CARES. The second question is a bit more gray and treating the loan offset as part of a CARES Act distribution may or may not be an aggressive position. I think taking a CARES Act distribution and then repaying the loan balance is not aggressive at all but requires a few more steps and cooperation of the participant to repay the loan with the proceeds of the CARES Act. distribution.

Any time you amend out a SH Match you need to give 30 days advance notice. I'm not aware of any exception that says, unless it crossed a plan year end.

What does your amendment say? I'm pretty sure you can set up separate sources and have the QACA safe harbor follow that vesting schedule and the traditional SHNE follow the 100% immediate if that's what client wants.

As David says you will receive the 3% contribution if they are a nonelective safe harbor plan for 2020, your termination in 2020 does not change that as safe harbor contribuitions can not have a last day of the year employment restriction. Whether you can take a distribution now or will have to wait until the contribution is deposited will depend on the terms of the Plan document and the Employer's administrative procedures. It's possible that you can take your funds now and then a second withdrawal after the funds are deposited but you might be charged 2 withdrawal processing fees depending of the how the plan handles that kind of thing. If you don't have an immediate need for the funds or intend to roll them to an IRA, you might consider waiting until the 2020 safe harbor contribution is deposited to your account for simplicity.

I was assuming the Plan allows for COVID withdrawals especially since OP said loan payments were further suspended under CARES Act, if it doesn't you are probably correct. But if it does allow for COVID withdrawals I think you can do the Loan Offset as described, as long a participant elects it. If you're not comfortable with a direct offset you could do a 2 step process that accomplished the same thing - take a COVID distribution for the balance of the loan and immediately pay off the outstanding loan.

I think you could get a COVID extension to 12/31/20 but I think payments would need to start in January 2021. I think he might be better off offsetting the loan in 2020 as COVID related. Participant would avoid 10% tax and could spread tax over 3 years or take in 2020. And could do a COVID repayment through 2022.

If he's an HCE it goes in the ADP test, if he's an NHCE it is excluded from the ADP test. If that HCE requires ADP refund, you don't double refund the 402(g) and Excess deferral, that is the excess deferral that needs to be refunded is reduced by the amount already refunded becuse of 402(g). There is nothing magical about off calendar plans, just a bit more complicated figuring them out some times.

Vesting is on service not participation. There are some exceptions for service that you can exclude but unlikely to apply here. 100% vested.

That would be my understanding as well assuming the plans are written that the DC plan satisfies the TH min. He would then be entitled to the gate way contribution if it is more than 5% which it often but not always is.

The tax credit is tied to how many non-HCEs are covered, since this plan covers no NHCEs it is not eligible for the tax credit.

I like Belgarath, I don't see a situation where the IRS would view rounding down to "Zero" as a reasonable method, even if you do it consistently.

Isn't it potentially a prohibited transaction Covered Service Provide and Plan Fiduciary to take undisclosed fees as the DOL deems the undisclosed fees unreasonable?

The 10% penalty applies to the 2018 unpaid minimum. The 100% penalty can be imposed by the IRS if it isn't cured. If you have another unpaid minimum for 2019 the 10% penalty would apply to that. I'm not aware of any excption that reads "unless the unpaid minimum is because you didn't make the prior year minimum" Here is the code https://corpuslegalis.com/us/code/title26/taxes-on-failure-to-meet-minimum-funding-standards (a) Initial tax If at any time during any taxable year an employer maintains a plan to which section 412 applies, there is hereby imposed for the taxable year a tax equal to— (1) in the case of a single-employer plan, 10 percent of the aggregate unpaid minimum required contributions for all plan years remaining unpaid as of the end of any plan year ending with or within the taxable year, and

Yes to every thing Bill said.

Well you have to grant service for time with all ASG/CG members, but I don't believe that extends to the time before they were an ASG/CG. To be clear and avoid any potential confusion, the plan should be amended to grant past service with new doctor's corp if that's the intention which it usually is in these situations.

I thought you had to have the same NRA to combo test them. If I'm right about that, the 401(k) plan could be amended to 62/5 to match the cash balance plan.

Merge one plan into the other and restate the surviving plan with both as adopting employers. File a final return for the plan that goes away.

Good question. I would assume it is a related rollover for TH testing but the in-service withdrawal is offset but the amount returned to the Plan so as to avoid double counting the amount.

Under Secure my understanding is the 10 payout year period starts in the year following death. If they want to rollover in 2021 RMDs might again apply prior to the rollover depending on the age of the participant since the CARES exemption to RMDs will no longer apply. But you can double check the Secure Act.