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A beneficiary of an IRA has been taking distributions for many many years. For 2019, the divisor (subtracting 1 for each year) is 1. The IRA balance at 12/31/18 was $50,000, and currently has a value of $60,000. MRD for 2019 appears to be $50,000. But what of the remaining balance? Never have seen the divisor get to 1. Any thoughts would be appreciated.

Thanks, Nicola. I tried putting in the actuary enrollment number, but my software rejected it, and asked for an EIN.

I am reviewing a Form 5500 for a Defined Benefit Pension Plan that had a change in actuaries (not the actuarial firm). The actuary was provided notice with the explanation "Reassignment of responsibilities within NAME OF FIRM. Schedule C is required, if I read the instructions correctly. Question is for the EIN on Schedule C, do you put in the Firm EIN or the actuary enrollment number?

It has worked for me as well.

That is correct. Someone with Schedule C income, partner in a partnership (receiving a K-1).

Partnership consists of 5 doctors: One doctor is a 95.96% owner, and the other four doctors own 1.01% each. 3 Doctors are considered Highly Compensated by definition, and the other 2 are not. For 2018, all 5 doctors made elective deferrals to a 401(k) Plan. 95.96% doctor owner wants to make the additional $36,500 employer discretionary contribution on his behalf, not realizing that his plan is a New Comparability plan and undoubtedly top-heavy as well (I am not the TPA on this, getting second hand information here). Their current TPA requires "a couple of weeks to perform the "pressure testing" (never heard it called that before)" to see what the employer contribution will be for the company. Complicating matters, the accountant filed the Form 1065 without extension; no employer contributions have been made as of today. The question coming for all is if the 2018 Form 1065 is amended to reflect the employer contribution that is necessary, does that give the company the additional time to make the contribution and have it deductible for 2018. Thanks for any replies.

Just received financial statements for a partnership with 2 partners. Based on the income of the company and the split to the partners, the plan fails ADP testing (no match), and both partners will need to receive substantial refunds for their 2018 contributions. Question is are the refunds subject to the Form 5330 tax for failing to make the refunds before March 15. I looked through the messages here and couldn't find any previous guidance. Any replies would be appreciated, thanks.

Going to BG5150's post above: In getting the actual numbers, the excess was around $10,000. As he was an active plan participant, there is no ability for a deductible IRA for 2018. He can certainly have a non-deductible IRA, but what about the amount over $6,500 (owner is over age 50)?

Interesting concept, I hadn't thought of that as an alternative.

I would think that if the former owner does not return the excess, he does have an excess IRA amount, subject to excise tax until it is removed. If the current owners notify him of this, and he does not return the excess, then I would think his accountant when filing the former owner's 1040 for 2018 to report the excess and subject it to the excise tax, until it is removed. The impetus then switches to the former owner to report apprpriately.

The latter; got a 3% SH on the 270,000 maximum compensation, when compensation was only $240,000.

During the course of an audit, it was determined that an incorrect amount of compensation was used for the owners of an S-Corp (Payroll records showed a gross amount of wages; however, one of the line items was for "reimbursements", which was not reported on the owners W-2). Therefore, all of them had excess annual additions (both for a Safe-Harbor nonelective contribution and discretionary employer profit sharing) for 2017. The Plan Sponsor wishes to correct this error by removing the excess (and associated earnings) from each owner and transferring it to the plan forfeiture account, to use in reducing future employer contributions. In reviewing, I believe that this can be self-corrected in reading the IRS Fix-it Guide. A complicating matter here is that one of the owners left in 2018 and rolled his account balance over to an IRA. Technically, I believe, he has an excess IRA contribution subject to excise tax until it is removed from the IRA account. However, the plan sponsor does not wish to inform the owner of that. The amount was around $4,000, so I don't know if it's material enough to warrant pursuing further with the former owner. Any comments on the above would be helpful, thanks!

Here is an interesting situation: The IRS , during an audit of a 401(k) Plan, has informed the plan sponsor that they were using the incorrect definition of compensation in withholding from eligible employees. They are requesting that the sponsor go back to 2002 to make the appropriate corrections. Here are the two questions that have arisen: The plan sponsor no longer has the payroll records back to 2002, but does have the compliance testing from their TPA (who is no longer in existence). They are wondering if they can use the compensation information from these tests in order to perform the calculation, informing the IRS that this is all they have and it's their best estimate as to the amounts due. The plan sponsor is doing the corrections on their own. Second, during this whole thing, the plan sponsor went bankrupt in 2001, and emerged from bankruptcy in 2005. They are wondering if they could be responsible for the corrections during a period of time where they were bankrupt. If anybody has thoughts on this, I would be interested in hearing them. Thanks.

Thought so, thanks for the response.

I have been asked to propose a 401(k) Plan for a business (LLC) that covers a family (father, mother, and child) group. The owner wants to set up the plan solely for the benefit of his daughter, who is an employee of the company and receives compensation that will be reported on a W-2. He and his wife do not anticipate utilizing the plan for themselves. My question is that if this plan is set up, does the plan file a Form 5500-EZ or the SF Form? The Form 5500-EZ is "Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan. Would the EZ apply because the daughter is an owner by attribution? Or, since she is not an actual owner or their spouse, is the 5500-SF the form to file? Thanks for any replies.

For a plan year ended 12/31/2017, an auditor determines that, during 2017, there were multiple failures to timely remit participant deferrals and loan repayments to the trust. The TPA does not agree with this assessment, as the plan became a large plan on 1/1/2017 and the employer was following the small plan safe harbor (7 business days) in remitting contributions. Even using this guideline, the auditor found multiple violations of the 7 day window. The TPA now realizes that they must file a Form 5330 regarding the IRC Section 4975 excise tax; however, no extension was filed, and they are concerned about possible Penalites and Interest for a late filing of the return. Does the TPA have any possibilities of filing the extension now, providing a "reasonable cause" for not filing the extension, and see what the IRS does? I have never had this particular circumstance come up before and was wondering if anybody had experience with this scenario. Thanks for any replies.

Thank you! I rarely deal with leasing company situations and that threw me for a loop.

A Schedule C business utilizes a leasing company to pay employees. Schedule C owner wants to know if they can make a SEP contribution on their own behalf, and not for the employees who are paid by the leasing company. It is unknown if the employees can utilize the leasing company plan, but, for arguement sake, let's say they can. In looking at various threads throughout here, I change my answer with every post I read. If anybody could give me some guidance on this, I would appreciate it.

Thank you both!

For 2017, the filing deadline for a C Corporation was moved to October 15, 2018. Did that also move the deadline for making a contribution for 2017 to October 15?

Question: An individual cannot contribute to an HSA once they are enrolled in Medicare. However, if they enroll for Medicare on June 1, could they have contributed to an HSA for the first 5 months of the year in question? If yes, how much could they have contributed? Is the maximum prorated for the 5 month period? Thanks for any replies.

Here's a twist: We have a client in the same boat, except that missed deferrals began occurring back in 2013 (an automatic enrollment plan where participants were not automatically enrolled, but it's a plan with a few hundred employees who were not enrolled!) and continues on to today. An ERISA attorney and the TPA have calculated the QNEC contribution, but the ERISA attorney wants to "negotiate" the QNEC. Who is he/she going to negotiate with and for what (the amount of the QNEC)? The IRS or DOL? I believe that this is going on through a VCP filing. Does that change things?

When you have a wrap document covering a health (plan 6/1/2017 to 5/31/2018) and a separate dental plan (11/1/2017 to 10/31/18), where each benefit has a different contract date and the Form 5500 is due 7 months after the plan year end, which date do you use to figure out the PYE of the required 5500 (over 100 utilizing the benefit) and when the 5500 has to be filed? Thanks for any replies.

Thank you! I don't deal with SEP's that often, and had forgotten the "preceding" portion of years.

Employer who has a SEP for himself hired an employee in 2016. Employee works throughout 2016, 2017 and 2018. Question is whether the employee is eligible for the SEP for 2018. I think yes, since they have worked 3 out of the last 5 years (3 of 3 here). I have someone telling me that they are not eligible until 2019. Any opinions? Thanks for any replies.