Lou S.

I believe for 2018 and 2019 they are key employees since they owned (or are deemed to own) more than 5% of the company in the current year for 2018 and the prior year for 2019. For 2020 and forward they would be former key employees.

My understanding is they would have until the due date of their tax return with extension for the year of loan offset to rollover the loan offset amount. That is if the loan is offset in 2019 you would have up until 10/15/2020 to complete the rollover. If he's trying to roll it over to the Plan you'll want to make sure the Plan will accept it, if he's trying to rollover to IRA should not be a problem.

I was under the impression that defined benefit plans could not have a last day requirement. That you could require more than 1000 hours for accrual but if you did you had to give partial accrual for 1000 hours. Is there an exemption for HCEs?

He needs to satisfy the RMD from his IRA(s) for 2019. I was using the simple case of having just 1 IRA where he would need to take the RMD before rolling into the Plan.

He would need to take his MRD from the IRA for 2019 before rolling the balance in to the Plan. Once rolled into the Plan he would fall under the 401(a)(9) rules for the plan so if he is not a 5% owner and continues to be employed he would not need to take an MRD from the Plan until he separates service. When he separates he would have a MRD for the year he separates due no later than April 1 of the year following separation.

I am not aware of any age restrictions in the code or regs that would prohibit it. Assuming \document allows for after tax and you don't have testing issues. If you did it properly you might be able to make the after tax contributions, do in plan roth conversion, then roll out newly convereted Roth piece to ROTH-IRA before end of year and avoid RMDs enitirely on them as well. essentially doing an end run around around both the ROTH IRA age limit and ROTH IRA dollar limit.

What is your Plan's definition of compensation? Does it exclude pre-participation comp?

C.B. probably hit the nail on the head. You probably have at least one HCE with a high EBAR and no or very few NHCEs in that HCE's rate group. It's often but not always the youngest HCE. Once you've identified the, you can come up with a solution.

I was wondering the same thing. And even if they somehow pass ACP, there is still the issue of 415 limits.

I think Doc Ument has a pretty good summary of the situation and likely IRS position but I'm curious - 1 - Is the trustee who signed the document in December 2016 also an officer, partner, and/or principal of the Employer authorized to execute documents on behalf of the employer? 2 - Is there a resolution, board minutes, or similar document in December indicating intention to adopt the Plan executed in December? 3 - Did the company fund benefits for 2016 and or file a 5500 for the 2016 year?

For what it's worth I agree with your research. Just tell your client you are experts in retirement plan law and IRC section 401(a)(9) requires the plan to process her RMD for 2019 before any rollover. Failure of the Plan to do so could result in Plan Disqualification which would put her whole rollover in jeopardy. Which it sounds like you already did. After that, tell her you are not experts in personal taxation and she should consult with qualified CPA or similar professional on matters of personal taxation and deductibility of charitable contributions. But that your understanding is that charitable contribution such as the one she is describing have to be from an IRA to get the treatment she wants and are not allowed directly from Qualified retirement plans. The charitable contribution as she describes is likely no different than any $10K check she writes to charity. Or as JstnERPA says, tell her to talk to her congress critters.

Process the RMD. Process the rollover. Tell her to discuss tax implications with her accountant. Unless you are also her accountant, in which case, good luck.

Disagree. If she retires in 2019 she has an RMD from the Plan for 2019 which is supposed to be the first monies taken from the Plan and that RMD piece is not eligible for rollover. My understanding is that the Plan should issue one 1099-R for the RMD and one for the balance of the Rollover with instructions to the participant to remove the RMD piece from the IRA as an excess IRA contribution that was not eligible for rollover. But as you say it is late on a Friday so my explanation may or not make logical sense.

Yes you lose the "get out of TH free card" so you need to satisfy TH minimum.

Deferrals had to come from his W-2 wages and be reflected on his W-2.

I believe it is something that can be done. I think you need to test it as a BRF. That said, I think it would take a strange set of facts for this amendment to fail BRF in a large plan because I would think that most of the folks who are getting additional years of service for vesting hours between 250 - 999 would in most cases be non-highly compensated employees. I'm sure there are some fact patterns where such an amendment would be discriminatory but I think in most cases it would pass muster. But I think you'd have to run the numbers and look at the demographics.

The new provider may not have gotten accurate vesting information or may not have loaded it on their system yet. This may be a simple fix. Call the Plan Administrator, probably your old employer, tell them you'd like to receive a distribution and request whatever paperwork you need to complete. Tell them you beleive your are 100% vested but the new record keeper does not reflect this. If you have old statements showing 100% vesting that would be helpful but not required. If you worked there 12 years, it's hard to believe you are not 100% vested though there are some unusually situations where this might be the case but not if you were previously 100% vested. Vesting information should be your summary plan description, if you can't locate your copy, request another.

I would ask the ERISA Plan Administrator (usually the Plan Sponsor in same plans) to clarify the method they would like to use. Then document it for future administrative consistency.

Some Sponsors will balk at any fees so yes a restatement charge at termination might get some blow back on fees.

Was company A sold in an Asset sale or a Stock sale?

I've asked several questions about top-heavy to the IRS over the years in mergers and acquisitions rarely if every got a satisfactory response. that said the plan is continuing as an ongoing concern so for the Plan Year the participants were Key-Employees for part of the year. I think their ownership ends on the date they sell but I believe they are key-employees in the year sold and the year following then former key employees in future years. I think the result is different if the Plan of the old company was terminated and the new company started a new 401(k) plan. That said Luke, you are right the regs on TH as it relates to mergers and acquisitions in essentially non exhisitant. So I admit the IRS position could be different.

Send him a cashier's check by registered mail?

I don't think you've missed anything.

Immaterial data errors corrected in next valuation?

Does plan use hours of service or elapsed time for eligibility? Are you sure Spouse never had a year of service prior to this year? Can you return the spouse deferral and forfeit match under EPCRS for 2018? If you amend the plan to bring her in, how many other short service employees would that bring in? and what kind of QNEC would be required for them? can that QNEC be used to satisfy TH min? If Plan is TH - any non key eligible will be eligible for TH min.