Bill Presson

"each deposit is supposed to pass testing" This phrase confuses me.

I would not make the decision or give recommendations at this point. I would put them in touch with an ERISA atty as soon as possible. Because I'm not sure the DOL is going to be terribly happy. In a bankruptcy, the judge would approve audit fees for the plan (if the sponsor had to pay) or the fee could have been paid by the plan. Obviously, I don't have the full picture, but just not filing doesn't seem like the appropriate tactic.

Correct. And a penalty still isn't triggered unless the person chooses to go to the marketplace and get a subsidized plan instead.

I just wanted to take a moment and publicly thank everyone involved in this board from Dave and Lois to the people that are constantly providing answers and guidance. Not sure how I would have survived in this business without this board. Thanks and I hope everyone has a wonderful Thanksgiving! WCP

Rollovers aren't included in the incidental benefit rule calculation at all.

I agree with your assessment. As soon as the transaction took place, he no longer worked for Co. B and that triggered an RMD.

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.