Lou S.

I believe it is the Plan Administrator's legal requirement to file the corrected 1099-R. That said, if you are the paid prepare and it was your fault the incorrect 1099-R was issued I would think best practices would be to prepare and file a corrected 1099-R at no charge. If it was not you fault (you relied on faulty information from the Plan Sponsor to prepare the original) then you should be compensated for preparing and filing a corrected 1099-R.

Related employers or unrelated? I think the answer might be different in both cases.

If the Plan is matching on a per payroll basis, probably best to fix it now and going forward. Sounds like it is an administrative system that needs some updating.

If a person over age 50 puts 12K in one employer plan and 12K in another unrelated employer plan then the both plans would put the full 12K in each ADP test. As far as they are concerned he hasn't hit any applicable limit, assuming the plan doesn't impose some limit below the $12K in my example.

It is, and we're looking into that possibility. Unless it is a related employer though it wouldn't matter. As far as this plan is concerned it's not technically a catch-up contribution at this point.

How do you sign up for "Catch-up contributions only"? You can't make catch-up contributions until you have hit some applicable limit, either plan imposed or IRS imposed.

I agree your solution makes sense. I just don't think it would fly with the IRS is all I'm saying. They seem to get all bent out of shape with these form over substance arguments.

I would say a standing election would be tantamount to making a ROTH deferral election subject to the 402(g) limit. I could be wrong but I could see the IRS taking that position if the Plan was audited. Is it really that hard to submit a conversion form with each check? I mean given the fact that result of doing so is permanent tax free gains?

Unusual but don't see where it would be discriminatory. I have seen plans that limit hardships to no more than 1 per calendar year but never seen one that puts a life time cap on it. I would think the biggest issue might be tracking such a cap, especially over time if the plan moves through multiple record keepers and you could easily inadvertantly fail to follow the terms of the plan by accidentially granting a 3rd hardship.

I would report the change as used to be done without issue. Though as you note CP-406 may be coming. Just prepare the client for it ahead of time and be ready to send a copy of the already filed form to IRS noting the proper change. It'd be nice if their form worked like it was actually intended to do but the reality is that often it does not.

Does Plan A allow for Hardships? Does the participant qualify for a hardship under the definition of Hardship in Plan A? If the answer to both of these questions is yes, why wouldn't the participant be able to take a hardship?

I don't recall ever attaching copies of cancelled checks to the 501. Is this a new requirement? It's been a few years since we terminated a PBGC covered plan.

Did he give any citation for his reasoning? My understanding is you typically have a deduction problem with the already made SEP contribution. That is you wind up having a partially non-deductible contribution to the SEP as the CB contribution is typically going to be well in excess of 25% of pay so to the extent that the SEP contribution is above 6% of pay it is non-deductible and subject to an excise tax.

Dead lord do you want crashes from folks falling asleep at the wheel?

Does this mean we can raise fees and they will now be considered reasonable?

A fair market appraisal of the the property should be used.

We typically treat it as the first pay day after entry so that would be 7/5 but I think at long as your administrative policy is clear and consistently applied it could be either.

https://www.irs.gov/irb/2014-17_IRB/ar08.html IRS announcement 2014-16 specifically lists 4/30/2016 as the date to adopt by. Where are you getting the 4/30/2017 date from?

The PPA pre-approved deadline for DC plans was April 30, 2016 The PPA pre-approved deadline for DB plans has not yet been announced to my knowledge but to get the extended restatement period for a DB plan I believe you need an executed Form 8905 prior to the end of the 5 year restatement period.

Good to know. Thanks for the cite.

I do not recall such nor do I see a change in the 5500 instruction on "Who can file". I always though it was odd that a partnership than had only partners and spouses could file a 5500-EZ but a corp that covered only owners and their spouses could not file an EZ if there was more than one owner.

It's not waived. I think he means the 5 year requirement has been satisfied since the conversion was in 2011, then 2011 was year 1, 2015 was year 5.

Because the DOL says you have to count vacation hours?

Are you sure? In this case I thought the plan failed ADP testing but refunds were not made because the deferrals are recharaterized as catch-up and retained by the plan. I fully admit this could be one of those strange IRS loopholes but my understanding is the key's have an allocation rate in this case for TH purposes but I'll be the first to admit my understanding of this could be faulty. I will also say I've never come across this particular set of facts in practice so I haven't researched it beyond cursory academic review.

What is your arraignment on fees? They could be paid by the plan sponsor, the participant and/or alternate payee could pay them directly or it could be deducted from the participant's account assuming the proper disclosures have been made. We typically bill the Plan Sponsor who then passes the cost on to the Participant who directs us to deduct it from his account and this is typically split between the Participant and Alternate Payee though the terms of the QDRO sometimes state who will be responsible for the fees.