thepensionmaven

We use CIMA, no complaints.

Yes, but that's not the question. Is a plan terminated when the money is out of the plan account or when an IRA is actually established. Difference will mean another set of 5500s

We have a plan that was terminated 12/31/2017. IRS considers a plan terminated if all assets are distributed within 12 months of the termination date. There are two participants who could not be located and the client directed 100% of each participant account payable to an eligible rollover institution that accepts and establishes IRA rollovers for missing participants. The checks were prepared last week and mailed to client, payable to the financial instution. If the checks are mailed ASAP to the rollover institution, is the plan closed since the money came out of the plan; or is the plan considered when the rollover institution establishes the IRA accounts?

Thank you, I was speaking of 2020, I know the Notice rules. I was questioning the participants who were not contributing; This is the client's only plan, therefore the Notice would take care of top heavy. Just needed confirmation. Thanks

Client maintains standalone 401k with match. Had he give appropriate Not ice of Safe Harbor by Nov 30th, would it have been possible to amend the plan eff 1/1/19 to a safe harbor match? There are many employees that are not contributing, causing both ADP and ACP to fail. This is a standalone plan and employer has not used the PS potion of the plan and does not plan to. What does he do with the other already in the plan, obviously count them as participants and not match, what about top heavy contribution?

And what makes you say "it amply illustrates the absurdity of our tax-favored retirement plans system". As another pension professional mentioned a few years ago..."SIMPLE plans are for simple minds."

Confusing to say the least. Client established a new DB in 2014. Less than $250K, so no 5500s. She tells him the following year "oh, yes, I have a 401K account I rolled over from another financial institution, consisting solely of funds from a pension plan we recently terminated. Apparently new broker took the assets and rolled into a "401K" account with no additions/subtractions. It is apparent to me, at this time, and after consulting with my ERISA attorney, that the broker who set up the account messed up (to put it gently) and opened up a 401K account and not a IRA Rollover. Obviously this person does not know what he is doing. This being said, I should speak with IRS and rescind the filing, or amend the filing showing everything as $0.

Larry, I certainly have a problem with this - taking it over. The account that holds the money from the terminated plan was rolled over to a 401(k) account, is titled as a Qualified Plan Account - Type 401(k). I came to the conclusion in October prior to filing the 2017 5500s that the 401(k) should have been filed previously, along with the new DB. Apparently the prior TPA new nothing about this 401K plan, and since the asset value of the new DB plan was less than $250K, did nothing. I assume I need to calculate her RMDs from both accounts. What a xxxxing mess.

Client has just forwarded an ERISA account application (not a plan document) dated in 2014 for a 401(k) account; apparently this client will sign anything put in front of her, and ask questions later. Client insists this was supposed to be an IRA rollover, and apparently never checked the title of the account.

According to the client, the previous TPA filed form 5500-Sf as a 1 participant plan for 2017. Should this be amended to $0 beginning of year and $0 end of year??

I have a takeover DB, the client , a sole prop., recently changed brokers. The rollover was done a few years ago, from a previous DB plan, but previous broker incorrectly titled the account "401(k)". The rollover was approximately $1M. The broker was from another brokerage firm I am working with the new broker and we want to straighten this out. This is not a 401K, she does not want a 401(k) and will never contribute to a 401(k); in fact she had always been under the impression this was an IRA rollover; upon further digging, I discovered this was indeed a rollover. Questions is, since the account was titled incorrectly, and has just been re-titled "IRA' with the new broker, would form 5500 need to be filed, or could the client claim "ignorance", "stupidity" or whatever, and if she were to be audited, explain what happened. The DB has less than $250K.

We use Datair for our documents; allows for both pre-tax and Roth, with any mix as long as the combination does not exceed 402(g). The question we run into about this is, how do you treat Roth when it comes to the SHNE contribution?

Yeah, voluntary after tax, so we must do the ACP testing. Good thing a few of the HCEs will not be contributing! Just the owners. I do realize 415. Thank you.

Client currently has 401(k) with 3% SHNE. No ER profit sharing. they want to add a provision for voluntary contributions. this this allowed and would any testing be involved, and what type?

Thanks, I mentioned 100% vesting a few years ago, and will remind him again.

Client wants to make a contribution for 2018. I would think IRS, in considering the plan "terminated" would disallow a deduction on the grounds that the client has not made a recurring contribution for more than several years; and all of a sudden decides he has ti make it as his accountant told him he needs the deduction. Just doesn't pass the old "smell test" to me.

We have a PSP wherein the employer has not made a contribution since 2013, has the investment broker send duplicate statements for one account, but there are several. I will not belabor this point here, as that is not my question. I know what a partial plan termination is, but as of when is this determined? From 2-3 years from the last contribution, which would make all participants 100% vested? Which would mean anyone receiving a distribution from, let's say 2015 forward must be 100% vested? For 2018, the account is telling us he will be making a contribution, which obviously would include any individual with a W-2 who is still "in" the plan plus any individual meeting eligibility of 21/12/1,000 hours.

Where can I find PLR 8139009 - have search online for about 10 minutes. I having been under the impression that there is no extension of the 8 ½ months for minimum funding, although there would be for deduction.

We have a participant who terminated employment with an outstanding loan. He is requesting a partial direct rollover of his account balance excluding the loan; wants to take the balance of his account as a taxable distribution. Obviously he will receive a 1099R, code L for the loan offset with $0 withholding. Somewhere I recall that the 20% withholding would be calculated on the total account balance excluding the loan - the total being the amount rolled over plus the amount not rolled over. Does that sound right??

How would this apply with a SHNE 401k?

Got it, thanks. I thought there might be a spreadsheet, which is why I asked again. Sorry.

Thanks, Tom.

I thought so, thanks for the confirmation.

I'd appreciate a copy.

Participant takes loan on his vested account balance, terminates several months later, having only repaid 2 quarterly installments. Pardon a senior moment, but I believe the total account balance is the investment fund balance plus the outstanding loan balance. Participant wants to take his money, default on the loan. Loan default would be outstanding balance as of the date of last payment plus interest through the term of the loan. He is eligible to rollover the investment portion of his account and the loan balance plus accrued interest is taxable. Two 1099Rs, one for the rollover, one for the loan default. Participant over 59 ½. Is the loan default subject to 20% withholding?