Susan S.

Paul, thank you for the clarification of terms. It is a Relius document which states that the loan becomes due and payable upon termination of employment. The default date is as you mentioned, the following calendar quarter. He was rehired before the default date so it does seem possible to let him make up the missed payments and continue repayment.

Participant with a loan terminated and was rehired 6 weeks later. Loan program specifies that the loan is in default upon termination, however, the loan has not yet been defaulted with the recordkeeper and there was no distribution of the remaining balance. Is there any loophole that would allow the loan to be reinstated and the employee to continue repayment? Does the Tax Cuts and Jobs Act allowing until the due date of the employee's tax return for repayment after termination come into play?

Recently took over a non safe harbor plan and am looking at making two changes to improve the ADP test results. First, the plan has an ACA (not EACA or QACA) and the plan sponsor has agreed to increase the default percentage from 2% to 3% effective immediately. It's a minor change but I figure every little bit helps. Second, the plan uses compensation for the full year and I want to amend to exclude comp before date of entry. Eligibility is no minimum age, 1 YOS, monthly entry. The employer will not be making contributions of any kind this year. Given these circumstances, can the compensation definition be amended mid year, effective for participants entering on or after June 1? There will be no cutbacks with no ER contribution.

The guidance I received from FIS / Relius is that there are no restrictions on the number of distributions per year. The participant can take as much as she wants and as frequently as she wants.

A 401(k) plan with a Relius document allows "partial withdrawals in excess of the required minimum distribution." A retired participant took her RMD in February, plus an additional partial withdrawal of $2k. Now she wants another partial withdrawal. Can the document language be interpreted as allowing multiple partial withdrawals in the same year that are not distributed at the same time as the RMD payment?

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I did ask the investment provider and they had no guidance. People who are furloughed need this money yesterday so I can't wait around until they figure it out. Mike and Bird, I can see it both ways but am going with Code 1.

I have to send in a distribution request form to an investment company and it requires me to enter a code.

What 1099-R code should be used for a coronavirus related withdrawal for a participant under 59 1/2? Can we use code 2 so they are not subject to penalty or use code 1 and let them sort it out when they do their tax return?

If a 401(k) plan has a limit of 1 hardship withdrawal per plan year, does the CARES Act override this provision so that a participant can take an additional withdrawal?

Perfect, thank you very much!

Can someone please tell me if my interpretation is correct? A SH 401(k) has dual entry, January 1/July 1, with deferral modifications allowed any payroll period. If an employee becomes eligible to participate on July 1 and chooses not to contribute at that time then changes their mind in September, can they start contributing immediately or do they have to wait until the next entry date of January 1? I consider the election not to contribute as a deferral of 0% which is then subject to the deferral modification dates and they can contribute the next payroll period.

I have a sole proprietor, income reported on Schedule C, with 2 employees. Contributions are basic safe harbor match and discretionary PS. Owner puts in max deferral and wants to reach his 415 limit. I know he has enough compensation to contribute the max, but it's the determination of plan compensation and breakdown between match and PS that I can't figure. I have looked at a couple of the posted EI spreadsheets and they all seem to call for input of a set percentage for ER contribution. I don't have that, instead I need to hit 415 limit. Is this something I can run in Relius or where can I find a spreadsheet that can do this?

Thank you all for the input. There are no minor children. I didn't realize a solo could also be a MEP, so I will look into that as an option.

A husband and wife each operate their own consulting business. There are no other employees in either company. The husband has maintained a solo 401(k) for some time and the wife would now like to join. Do controlled group rules enable her to participate in the solo plan or would she need to be an employee of the husband's business?

A 401(k) participant wants to treat her RMD for the year as a qualified charitable distribution. She is eligible for an in-service distribution, so since these rules apply only to IRA's we could transfer her money to an IRA first and she could make the charitable distribution from there. However, isn't the RMD required before the rollover to the IRA? Is there any way around this hiccup?

An employer with leased employees sponsors a 401(k) plan and, in addition to that plan, the leased employees are also participants in the 401(k) plan of the leasing organization. The employer has decided to terminate it's plan and will not be replacing it, but the leased employees will continue to participate in the leasing organization's plan. Are the leased employees entitled to make a distribution election, or is the employer considered to "maintain" the leasing organization's plan and the balances must automatically be transferred to the leasing organization’s plan?

A participant loan program specifies that a participant loan "is due and payable on termination of the plan." If the plan terminates on December 31, must the loan be paid off before that date, or does the participant have a certain number of days to make the payment after being notified, even if it extends the repayment date beyond the plan termination date?

Can a Form 5300 be filed for an affiliated service group determination if filed before the revised form comes out on January 1? It is a new 401(k) plan with an unmodified preapproved volume submitter document with an effective date of 1/1/17. If it can be filed, as a new plan does it qualify for the fee exemption?

Companies A, B, C and D are in the investment advisory/insurance business and are all LLC's. Company A has ownership in Company B, but C and D are unrelated. The four companies together formed company XYZ. A,B,C and D will continue to operate under their individual business names, but technically will no longer have employees as all will be paid by XYZ. Basically a D/B/A type situation. Due to the nature of their businesses, my conclusion is that they have formed an affiliated service group. Company A has an existing 401(k) plan and wants to change the plan sponsor to XYZ and cover all 4 entities. Do A,B,C and D need to adopt the plan as participating employers? They will still have separate EIN's but won't have any employees.

I knew you all would have some great ideas! Belgarath, can you explain further about the children? They do have minor children, but why does that matter?

That's funny, I hadn't even thought about that!

A client of ours is a physician who is 100% owner of her private practice and sponsors a 401(k) plan. She and her husband bought 80% of a liquor store, not realizing that they might have to cover these employees under the plan. I don't see any way around this being a controlled group but I wanted to make sure I'm not missing something. They asked about transferring all ownership to the husband, but I told them the attribution rules applied. I'm sure they couldn't pass coverage by excluding them, as there are more employees at the store than the clinic. Is there any creative way to structure this to avoid a controlled group?

When running an amortization schedule in Relius, is there a way to specify the payment amount instead of the number of payments? I thought there used to be a way to do this, but the payment amount is grayed out. I have a participant who wants to pay $50/week. I can get close, but would like it to be exact.

Thanks, I had looked at the FAQ's but missed that part. Doesn't seem fair at all, but I'm not surprised.