Bill Presson

Have you looked at the coverage testing if you exclude the liquor store participants? Assuming the husband would be an employee of the store (and excluded) you might pass. I've done that kind of thing several times before.

That might be difficult to do with the one that has already been rolled to an IRA. True. I missed that part.

To me this is a payroll issue and not a plan problem. I would refer it back to their CPA and payroll company to decide how to fix.

I believe they get to pick which plan they reduce, so they should pick the one that won't impact the match, if possible. ETA: Obviously, this advice is much more useful when distributions haven't already taken place.

It was somewhat common before electronic filing. I thought the new electronic process wouldn't accept the return without an audit attached.

What about the attorney that helped you during the divorce? If they didn't do their job then, they should help now. Or they might need to be sued for malpractice. That's not something an attorney should have missed.

So the owner had to get a K-1. As long as he had active involvement in the running of the business, then he's had earned income since the LLC started. So the issue is really that he's been eligible for quite a long time and the tests haven't been accurate if he hasn't been included.

Actually had a plan sponsor do this for a few years. I kept telling them it wasn't required but it wasn't until the third year that my words actually hit home that they were spending $10k they didn't need to spend.

So if the plan has quarterly entry and a participant enters on 10/1, the plan requires 1000 hours from 10/1 to 12/31 to receive an employer contribution? I've never seen that in a document. Seems like an attempt to have a mostly 2 year wait without having to 100% vest employees.

You say "one company ended their SIMPLE plan." That can't be done in the middle of the year. https://www.irs.gov/retirement-plans/terminating-a-simple-ira-plan

Any chance they will just re-register the account as personal investments? They may be more willing to do that since they'll keep the assets.

I think it's funny that they determined he had the authority to open the illegal account and deposit the illegal money but doesn't have the authority to distribute the illegal money because that would be illegal.

I would contact Penchecks and see if they can help you out. http://www.penchecks.com/our-solutions/trust-resolution/missing-distributees-solutions/

Not if you keep talking about it.

But we are often looking for sites with cites.

If it's 3%, I'm assuming you didn't actually mean "match"?

Thanks. I wasn't intending to confuse the issue.

OVER 120. :-P

I'm not saying anyone should be let in early. I think the rules should be applied equally. But we're sometimes faced with different tasks: tell me what to do correctly from here on v. how do we fix something that happened in the past. Like I said in my first post: I don't have an answer. But sometimes a "technically correct answer" is helpful so I just wanted to post the reminder.

I don't have an answer, but remember that it's very rare for a new employee to qualify as an HCE.

Depends on when the plan had over 100. If it's the first day of the first plan year, then yes. If it's not until the first day of a year after, then maybe not unless it's reached 120. But either way, the first sentence is irrelevant.

If a plan year and employer fiscal year don't match, I find it more common that the plan year is calendar year and the employer fiscal year is not.

The DOL reg allowing for limited scope audits references that timing. 29 CFR 2520.103-5 - Transmittal and certification of information to plan administrator for annual reporting purposes.§ 2520.103-5 Transmittal and certification of information to plan administrator for annual reporting purposes. (a) General. In accordance with section 103(a)(2) of the Act, an insurance carrier or other organization which provides benefits under the plan or holds plan assets, a bank or similar institution which holds plan assets, or a plan sponsor shall transmit and certifty such information as needed by the administrator to file the annual report under section 104(a)(1) of the Act and § 2520.104a-5 or § 2520.104a-6: (1) Within 9 months after the close of the plan year which begins in 1975 or September 30, 1976, whichever is later, and (2) Within 120 days after the close of any plan year which begins after December 31, 1975.

It's very rare, but it is possible. When i worked in Kentucky, we had a large medical practice as a client where all the individual owners served jointly as trustees. It was an issue replacing them as the various doctors joined and left the practice. They applied for and got approval to have the practice be the official named trustee. I believe they worked with the Department of Financial Institutions in the state capitol to get it worked out.

I would ask "why" as well. Is the reason to pay for funeral expenses, etc? If so, then the participant needs help in getting the designation structured to accomplish his goals.