RPP2001

Thank you all. This is helpful, glad to see I didn't miss guidance on this, although, it would have been nice to have it. We'll proceed with a blend of the wordings you have suggested.

For plans that are MEPs because the employers are related in a way but do not fit together as an affiliated service group or controlled group, what wording should be used for the blank on the new MEP Schedule in Part I1(d)? Derrin Watson has described these employers as "kissing cousins" and of course, we wouldn't use that unofficial terminology, but, we want to make sure to use appropriate wording. What is everyone else using? I do believe it at least needs to mention "defined contribution plan". Thank you.

Thanks for the feedback.

A company has remote employees in a state where that state has a state mandated retirement plan but the employer itself is domiciled in a state that does not have a state mandated retirement plan requirement. If the employer does not provide a retirement plan of its own in the private marketplace and if it does not want to start one, does that mean the employer has to work with the state plan for those applicable remote employees?

Thanks all, we figured the only solution was indeed starting a new plan and doing the merger and handling the reporting/filings for both plans. I still don't understand why the SECURE Act wouldn't permit just retroactively amending the existing plan to add the feature. We end in the same place, except the client wouldn't have all these filing and reporting requirements and steps (and, not to mention our associated fees) for now two plans between the two years. We come across quite a few plans, unfortunately, that we takeover to handle the work for the prior year that do not have a profit sharing feature that would otherwise benefit the client.

I have a client that would like to make a profit sharing contribution by her 2021 extended tax filing deadline of 9/15/22 for the 2021 plan year. We can get the calculation done, but, the existing 401(k) plan does not currently offer profit sharing. Is it permitted under the SECURE Act to retroactively add a profit sharing feature to an existing 401(k) plan for a prior year? This is not starting a brand new qualified plan (such as profit sharing or cash balance) retroactively (which is pretty clear in the SECURE Act as acceptable) but instead adding the profit sharing feature to an existing 401(k) plan. As a side note, if it matters for context, this is a solo plan (husband and wife). Thank you.

Wild question. Does anyone have a sample spreadsheet that would calculate the actual earnings (based on plugged data such as plan earnings rates for the different periods, late contribution amounts, etc.) that they could share? Or, how are most people who are using the self correction method, but, not the DOL calculator handling the actual earnings calculations?

If an employer begins to pay the related 403(b) fees, does that employer involvement cause the plan to fall under ERISA status to shift the plan from non-ERSIA 403(b) to ERISA 403(b)?

Thank you John. Also, I assume having after-tax contributions deposited in a safe harbor plan does not kick them out of top heavy minimum exempt status, correct?

Correct, they are the traditional employee after-tax contributions, not Roth 401(k) deferrals.

A safe harbor plan wants to allow for employee after-tax contributions. The ADP safe harbor match is enhanced at 100% up to 6%. Also, the plan is top heavy. Two questions: 1. The plan must perform the ACP test with respect to the employee after-tax contributions only? Or, can you include the ADP safe harbor 100% up to 6% match in the ACP test along with the employee after-tax contributions? 2. Is the plan deemed top heavy exempt since the only employer contribution is the safe harbor match of 100% up to 6% or does the existence of employee after-tax contributions trigger the minimum top heavy allocation requirements? The concern is that the only individuals expected to contribute the employee after-tax contributions are the key/HCEs. Thank you.

A plan allows only 1 loan outstanding at a time per participant and the minimum loan amount is $1,000. The plan allows refinances. A participant has $400 outstanding on their loan. If the participant wants to refinance their loan, but, the additional proceeds available due to their small account balance is only $700. Is this refinance permissible? I am not sure whether the 1,000 minimum amount should appy to only the additional proceeds amount ($700) or if it applies to what would be the new outstanding amount ($1,100 which is $400 + $700). Any help would be appreciated. Thank you.

Thank you very much. The ERISA Outline Book in Chapter 2, section VI, Part E in its Example of a 401(k) feature seemed to imply that anyone employee in this situation that does not have an account balance would not be considered a participant for Form 5500 purposes. But, I took a look at an FT William document and it appears that these employees would still be "in" as you say Tom - not only to be included in the participant count but even that they would be able to continue 401k contributions after the amendment.

A 2014 calendar year plan is amended to begin excluding a class of employees as of 7/1/14. If this occurs and there are employees that had previously met the plan's eligibility and entry requirements and were previously considered "participants" in the plan even though they do not have account balances, are they considered participants in the plan effective 7/1/14 due to the amendment? This plan requires an audit for 2014, but, depending on this answer, it may drop below 100 participants as of 1/1/15 which would allow the plan to not have an audit requirement for 2015. So, the question is definitely with regards to how a participant is defined for Form 5500 purposes.

We have a 401k plan participant that only has a life insurance policy as his plan asset and he is a 75 year old terminated employee. Is there an RMD requirement for this participant, and if so, how is it calculated, “distributed,” and taxed? Thank you in advance for any advice.