Lou S.

Assuming the wife is the sole beneficiary wouldn't it be processed like any other death benefit of the plan through the Plan's administrative procedures? The issue than becomes one of withholding to a payee outside the US and what withholding rules may or may not apply.

I don't know the answer to that, but I can't see the IRS or DOL having a problem sending money form the plan that is required to be paid to the participant directly to the participant's account assuming you were sure it was the participant's account and sending it the same place you send his or her paycheck would seem to be their account and presumably they have given consent to send their compensation deposited to that account. I'm not sure why it wouldn't extend to the Plan of the Sponsor but I am not a lawyer.

Prohibited cut back to add a last day requirement for 2020 for anyone who statisfied the current allocation requirement.

You can keep reissuing the check or you can call HR and see if his paycheck is direct deposited and send the next one directly to his bank via ACH or Wire.

I agree with Bill. You could establish a regular 401(k) Plan for 2020 using prior year testing and cap HCE deferrals @5% of pay. That would allow HCE's to contribute 5% of annual pay plus the 2020 catch-up limit if they are 50 or over. It's not the full limit but of your HCEs are over the comp limit of $285K and at least age 50 they could defer $20,750. You amend the plan to SH for 2021 and also remove the 5% of pay cap for HCEs for 2021.

In other words the lump sum is the greater of plan rate or 417 rate but not in excess of 415 limit.

Because 415 trumps 417 in the lump sum benefit calculations.

If your pensionable income is equal to or higher than $266,667 your 401(k) should be fine as the $19,500 401(k) contribution does not go into the 6% calculation for deduction purposes and $16,000 is 6% of $266,667. If you are a corp that will mean your W-2 is $266,667 or higher 2020. If you are schedule C, talk to your TPA about what your earnings for pension purpose are as it can be a bit complicated and circular as every dollar of employer retirement plan contributions will reduce your income by $1. But you'll probably want to run through all the numbers with your TPA/actuary and possibly your CPA who probably has a better handle on it with full information.

Simple 401(k) or Simple IRA? Matching Simple or Non-elective simple? If it's a SIMPLE-IRA the IRS FAQ may be helpful to you. https://www.irs.gov/retirement-plans/simple-ira-plan-faqs-contributions

If the sponsor is worried about wide spread participant loan fraud, don't offer loans.

Or if employees abuse it, amend out plan loans. They aren't a protected benefit.

Default the loan under the plan's loan provisions. Issue 1099-R for the income. Carry the loan including accrued interest on the books against the participants loan limit until the participant has a distributable event.

I haven't checked in a few months but I thought participants who died on or before 12/31/2019 are subject to pre-Secure Act rules and that participants who die after 12/31/2019 are subject to Secure Act rules.

Leaving it in the Plan Sponsor bank account wont work. Setting up an account in the name of the Plan at the Sponsor's bank will work for reasoanbly segregating the assets from the Plan Sponsor into the Plan. The question of whether the assets held in a back account for several weeks while the investment account for participant direction is setup is a fiduciary question about prudence.

If she properly elected irrevocably to be out of the plan, she is a non-benefiting employee for 410(b). My understanding was that the irrevocable election needs to be done prior to plan entry but I honestly haven't double checked that in quite some time, I could easily be wrong on that. In small plans, allowing irrevocable election to not participate can cause demographic failures that may be difficult to cure through retroactive amendments expanding participation. As for SH I'm not sure the implications on allowing a NHCE to irrevocably elect out of the plan, if it's an HCE you're fine, if it's an NHCE I honestly don't know what that does to your SH status.

The internal revenue code is full of oddities. But yes a T-H contribution needs to pass non-discrimination tests on employer contributions even though it is mandated by the code.

Check your document, I think they would likely come in under the service spanning rules but you are correct it is possible they could get axed out by the hours requirement.

Unless the PBGC changed their rules in the past few years, filing the Form 500 prior to the actual termination date is not a problem as long as everyone has received the NOIT and NOPB. One thing you do want to be careful of is you are filing for an IRS DL on termination, make sure you file the IRS DL before the Form 500 to get the extended distribution window. If you're not worried about the extended window you can file the Form 500 at any time after you confirm participants received the required notices.

I agree that these are questions for a competent divorce attorney. And if done right I would think you'd be able to get at least half of the assets now instead of 0% of the assets when he dies.

Perhaps an ERISA attorney has a different view (I'm not one) but I would simply treat him as a terminated employee and a participant with a balance in the plan. I believe that would be the most conservative approach.

Is the Partnership dissolving or just losing a Partner? Is the Plan terminating? If it is not terminating who will be the Sponsor? If the Plan is continuing how can you force him out? If the Plan is dissolving then all accounts will need to be paid out. Though why a general partner who is leaving would want to leave his funds in the Plan is a bit of a mystery to me, but not really relevant to your question.

Check to see if the document already has a PS feature and vesting schedule but the Plan has simply not made a PS contribution. If that is the case, you'll want to look at the rules on changing a vesting schedule. You cannot add a PS feature to the Plan and start vesting in 2020. You may be able to exclude service prior to the effective date of the Plan in 2017.

I think you may be confusing the rule that to be a safe harbor 401(k) plan you need to allow for at least 3 months of elective deferrals with the new rule in the Secure Act that allows you to add a 3% non-elective safe harbor to an existing 401(k) at any time in the first 11 months of the plan year (or 4% non-elective in the 12th month of the plan year). I don't think anything in the Secure Act allows you to establish a new safe harbor 401(k) (or add 401(k) feature to existing PS plan) with less than 3 months left in the year.

Yes they are still entitled. There are never any hours or last day restrictions on receiving safe harbor contributions of any kind.

Not the CARES Act, the Secure Act. A 401(k) Plan that is NOT a safe harbor can be amended to a 3% Non-elective Safe Harbor in the first 11 months of the plan year. A 401(k) Plan that is NOT a safe harbor can be amended to a 4% Non-elective Safe Harbor in the 12th month of the plan year. For a regular 401(k) Plan, you can not add a Safe Harbor match mid-year. For a Safe Harbor 401(k), you can not change the type of Safe Harbor; match to Non-elective or Non-elective to match mid year.