stbennet

Any guidance on using SECURE Act to re-adopt SHNEC after cancelling SHNEC mid-year? Will that fly?

Looking at the 2013 Schedule SE and want to make sure I'm understanding correctly. We are back to a .5 multiplier on both the SS and Medicare to determine the deduction? The .596 multiplier on the SS was just 2011 and 2012, correct?

Remember reading a prior thread discussing this a while back. http://benefitslink.com/boards/index.php?/topic/47120-funding-target-in-a-cash-balance-plan/

DB plan with no hours requirement for entry but 1000 requirement for accrual. So, those employees that have never had 1000 hours are still in testing population but aren't benefitting. I'm not passing a26. Can I apply a26 to statutory group and OEE group separately? Since nobody in the OEE group is benefitting in the DB, would it matter? Code says: (B) The plan under which the otherwise excludable employees benefit satisfies section 401(a)(26), both by reference only to otherwise excludable employees and by reference only to employees who are not otherwise excludable. I have no clue what that means. Thanks.

Gosh dang it, I need to start proofreading. Meant combined plan TH. Yes, he clearly gets the gateway.

Considering a cross tested 401k/CB plan th at is Top-Heavy. A participant works 1000 hours but isn't employed on the last day of the plan year. Let's say the participant is getting 5% in the PS due to gateway plus the cash balance credit. Since the participant doesn't satisfy the PS TH conditions, I'd assume he isn't eligible for the combined plan gateway edit: Top heavy and has to get the 2% accrual in the CB plan, even though he is getting a PS allocation sufficient to cover the combined plan TH in the PS. So questions: 1) Any opinions/references if that's the right way to do it? 2) Is it possible for a plan to remove the last day requirement for TH in the PS plan? I see the last day language in the document but nowhere in the "checklist."

Sorry, wasn't thinking clearly. What I meant to illustrate is the situation where two HCE's are not in each other's group. So for example, a situation with two HCEs and the HCE denominator for each rate group is 1/2.

Wondering if anyone can point me to something concrete here. It comes up occasionally that I've got HCE's that wind up in each other's group because of the disparity between the EBAR and MVAR. Is there anything out there or does anyone have negative experience that this accrual rate "straddle" should be avoided or somehow is abusing a4 testing? Comments are appreciated.

Cross tested PS/CB plans. CB plan is one year/dual entry with 1000 hour requirement for allocation, PS plan has no entry requirements and only a last day requirement for contribution. There are several HCEs (all but "Main Guy" excluded in the CB) and a bunch of employees, but the only PS groups are "Main Guy" and "Everybody Else." Client wants to minimize the PS contribution for "Everybody Else." Using otherwise excludable testing, If "main guy" is maxed out and those people benefiting in the CB plan get "bumped up" to the gateway the plan doesn't pass 401(a)(4) testing. Are there are other options besides? 1) Reduce "Main Guy" in the PS so gateway is enough to pass 401(a)(4) 2) Give "Everybody Else" including all those HCEs the same amount above the gateway to pass 401(a)(4) (nearly doubles the cost of "Everybody Else" as opposed to gateway for non-OEE alone.)

Paranoid busy season question: Cash Balance plan has a one-hour allocation requirement. There's still no need to worry about TH if the participant doesn't have 1,000 hours, right?

As far as the requirement for participant statements goes for Cash Balance Plans, would the hypothetical account balance and vested hypothetical account balance be sufficient? Or are people using the Monthly Accrued Benefit and Vested Accrued Benefit? Easiest solution is to use both, I suppose, but these things are cluttered enough as is. Thanks.

The adoption agreement lists actuarial equivalence as "N/A - plan is fully insured." Once the plan fails to meet the 412(i) requirements, are there guidelines on how the plan should determine actuarial equivalence?

2009 Plan Year Minimum Required Contribution goes unpaid. There are no quarterly installments are required in 2009. There are quarterly installments required in 2010. I understand that all payments have to be applied to the 2009 unpaid minimum first. I'm confused as to whether I'm just using the 2009 effective rate, or if I need to add the 5% penalty at any point. Any advice is appreciated.

First year of a cash balance plan with 26 active participants using the plan's definition. However, only 23 participants actually received a hypothetical account allocation. Using the "benefit liabilities" definition of participant ala the PBGC premium filing the plan would qualify for the professional service organization exemption. I know they wouldn't have a premium due in the first year regardless, but does anyone have experience with this type of situation? Would they be required to file?

Plan specifies that non 5% owners get actuarial increases the April 1st after age 70.5. Can anyone point to or provide guidance whether or not this applies if the participant has reached NRA (5 years participation is required.) Thanks.