TPApril

Do employers generally track hours separately from pay, ie W-2 pay? So W-2 reports pay for pay date 12/31 of the prior year, paid on 1/5. Employee had 970 actual hours worked in the current year, but when hours are reported alongside payroll, there were 1010 hours worked. Say the 12/31 hours reported on the 1/5 payroll are not included, but the terminee has 40 hours of vacation pay. In both those situations, what do companies generally do, count the hours?

Luke - thank you but that's not it. Just curious if there has been a trend for employers to ask all new employees for marriage certificates.

My understanding is that in years past HR departments would not ask for Marriage Certificates. When Marriage Equality became legal, some departments started to ask only same-sex couples for their Marriage Certificates, which ultimately was determined to be discriminatory and not a recommended practice. Any thoughts if HR departments are now asking for Marriage Certificates from all new hires these days? This would be mostly related to setting up their medical benefits with spouse coverage included.

That would be a great idea Peter Gulia.

There are 5 Participants in Plan - Owner, her husband, their 3 over 21 and not disabled children. Both Owner and husband began taking RMD's. Owner dies in 2018, after RBD. Her husband is taking RMD's of her account. Husband dies in 2022, also after RBD. The 3 children are the beneficiaries for both accounts. Looking to confirm what I think the new rules are: Owner: 2022 - Paid as intended based on subtracting 1 from 2021 RMD factor used 2023 on - Must be paid by 12/31/32 to 3 children, using life expectancy of oldest son, then subtract 1 each year, w/bulk being the RMD for 2023 Husband: 2022 - Paid based on his age in 2022 using new table 2023 on - actually the same as for the Owner above

Shot in the Dark - have you ever put this into action, or seen it used? Not sure why ftw offers this as an option, I'm not convinced that you can not give an NE allocation to someone who is employed on and terminates on the last day.

Haven't seen this before. Fidelity bond coverage is lower than 10% needed, set at $20,000, but according to the agent, has a built in 'inflation guard' up to $500,000. Assuming that is fine, what would we report on the 5500? In this case $500,000 is greater than plan assets even.

I'm with you ESOP Guy, I don't get it. After many years, this is the first time I've seen this feature, though I've certainly learned not to be surprised.

I guess we've always treated someone who terminates on 12/31 as being included under 'last day worked' requirements and therefor eligible for the NE contribution.

Plan has a last day worked requirement in order to receive nonelective contributions. However, participants that terminate employment on 12/31 (cal yr plan) are not eligible. Never seen this, what is the justification? Do plan specs state clearly, must be active employee on last day of the plan year?

Affiliated Service Group question: Attorney with his own LLP and his own retirement plan, moves into a new law firm's offices, and his name is put onto the firm's website. He has access to the Admin staff. Law firm however treats him as an independent contractor instead of W-2 employee. Law firm does not intend to give him retirement benefits. I just get so dizzy from these controlled group concepts. Not sure if he needs to be included in nondiscrimination/coverage testing with the existing law firm's retirement plan (after the first year as Otherwise Excludable).

Plan has two trustees. One of them has retired and is simply no longer involved or around. There is no board for this small company. Can plan be amended to only the one remaining trustee by this one remaining trustee and not involve the outgoing one?

Welfare Plan has reached 100 participants so it's time to file the very first 5500. Apparently their existing plan document shows a 6/30 plan year end, but their policies are calendar year. They'd like to change the plan year and create a short plan year for the last year (ie today is 4/20/22 and they would like a short plan year 7/1/21-12/31/21). I think it's too late to retroactively (and easily) amend for that short plan year. But curious of other's opinions in the following two scenarios, if it can be done: 7/1/21 count < 100 so no 5500 required for a short 6-month plan year 7/1/21 count > 100 so a 5500 would be required at 12/31/21 (not yet due)

Non taxable fringe benefits - not eligible for 401(k) per plan comp definition but plan applied rate of 401(k) election and deposited it into the plan. Amount has been refunded and 1099-R will be issued. Does this now become taxable income for year of refund?

Professional services firm where participants have their own accounts with the broker-dealer. Partners always changing, firm name always changing. How important is it that the trustee name be updated?

Yes, the owners/officers do not participate, but this is the person that runs the business and has been there 20+ years.

Peter - those are great idea, though certainly making things more complicated. So...I pointed out the risk exposure, a variety of options, and the Plan Administrator only wants to do what is always done. I'm sad about that. My guess is she was so trained by prior TPA's. I feel like I put some pretty strong arguments out there. I just don't think it's right to assess a new participant 20% when the decision maker is only being assessed 0.1%.

Bird - I can assure you this was not set up by my firm. It's a new account and apparently that's how they've 'always done it'. Well not anymore. Too much risk exposure. Unauthorized commentary: When I find questionable procedures, it's almost always from larger practices that are focused more on sales than on service and the employees who provide the service. The other odd practice is how many of these practices don't even have a checking system. If a Sr. Consultant had seen this in action maybe it would have been stopped already. But then if they figure this out, their unintended role as my nonpaid sales team might crumble.

401(k) Plan has no HCE or Key participants. Plan allocates TPA fees among all participants in equal amounts. So those with large accounts will have less than 1% taken out, but a new participant will have 20% taken out. This doesn't feel right but I am looking for an argument to give the plan sponsor and wasn't sure if there was some kind of discrimination issue. The one who makes this decision is getting less than 1%. Maybe it's simply that that is not 'reasonable'.

Peter - thank you for your time putting that response together.

A 'friend' was traveling with her family last week, after the effective date of reimbursements for home covid tests, and found her family in need of purchasing multiple covid tests. In the process of taking these tests, the test materials and packaging themselves were discarded. Upon arriving home, this 'friend' contacted her insurance who has informed her that they will need both receipts and the UPC symbols in order to get reimbursement. Is this excessive and even allowed?

So you are saying contributions to the State Gov't plan are incorporated into the 402(g) calculation?

State employee participates in their plan. He also works for wife's firm who has a 401(k) Plan. I know 415 limits are plan specific. But is there an individual 402(g) limit that combines contributions to the state plan as well as the private plan?

Sometimes a question comes up that I should know the answer to and my mind is staring at me blankly. Is the Special Tax Notice required to be provided to a participant requesting an in service distribution? I think the answer is an unequivocal yes.

Yes, I hate to say it, but the one outstanding loan happens to be a 50% owner, albeit not the one who serves as Trustee and is asking for this change. The only other prior loan was an NHCE. I immediately responded that I strongly recommend against it and owner said he just wants to get rid of the option. Reason being he hates the administration dealing with payroll and the recordkeeper.