TPApril

Larry - I'm surprised you are surprised at anything you see these days ;).

Distribution requested at $1,000 Related Fees are $100 Would the 20% withholding apply to $1,000 or $900? (So would 1099-R reflect a $900 or $1,000 distribution?)

What with a current downturn in the market, how long can a plan sponsor wait to distribute assets, having received completed distribution forms, including 30-day waiver? (for a pooled account)

Revisiting this discussion of TDI pay and W-2 pay and treatment or not as eligible compensation. plan Definition of Compensation is simply W-2 Plan Sponsor used to receive TDI payments from insurance carrier and run them through payroll, so it would show up on employer W-2 Now the insurance carrier pays TDI directly and issues their own W-2. Based on plan definition (with no embellishment beyond including 401k and 125), would TDI be included in both cases for plan compensation?

Plan was signed 6/1, with effective date 1/1, but 401(k) effective 7/1. Since plan started mid-year, actual 401(k) and safe harbor match are based on compensation from 7/1. Plan defines compensation for all purposes to be full year compensation. This leads to two initial questions: If 401(k) wasn't even available for the earlier period, is it possible to use full year compensation? this would apply equally along the way to new participants who enter mid-year Nice thing for those receiving contributions is they would be receiving greater contributions with full year compensation. Thank you

Previously this thread discussed when a participant is assigned to a group for allocation purposes. Circumstances were that they were already assigned, but the testing didn't pass, so an 11(g) amendment had to be adopted. Question now is: are there time restriction as to when to assign a participant to a group? ie prior to end of plan year?

Plan eligibility for 401k and match is at hire. Plan will match 100% of the first 6% of 401k. Plan wants to set up traditional auto enrollment at 3%. No safe harbors in this plan. Does that sound funny?

as usual, plan sponsor is looking for ways to encourage terminated participants to take their distributions.

Plan has a pooled account. Would there be a concern with placing terminated participants into a separate pooled account that just contains say a Money Market fund?

okay, I'm confusing myself here. Sample nonprofit has a fiscal year starting 7/1. Their 401(k) [not 403(b)] plan year is calendar year. The deadline then for depositing employer contributions would be based on fiscal year, ie 10.5 months after 6/30, or 4/15 of the year after the year it ends. I think an example would work better: Plan year ends 12/31/19 Fiscal year that this plan year ends within ends 6/30/20 10.5 months after that is 4/15/21. Is this the technical deadline for employer contributions for such a 12/31/19 plan year?

for clarification on running the ACP Test on match in excess of 6% - consider this formula, 401(k) is matched 100% up to 8% comp. ADP Safe harbor is met. Since ACP Safe harbor is not met, testing on that additional 2%. does this mean the numerator only includes matches from 6% - 8% (ie up to 2% per participant). In practice I'd imagine this doesn't tend to pass, considering that it would seem that HCE's would predominantly benefit from the additional match? Perhaps a 133% match on first 6%?

In situations like this where it seems there are no HCE's and you don't anticipate there being HCE's, I'm curious if there is a tendency to design the plan as a safe-harbor or not, particularly if the board wants employer contributions to be fully vested?

Sorry! SIMPLE plan termination.

Curious if disaster relief applies to other things, in particular notices. We have a notice due by this Saturday, but due to the fires and power outages in CA, the notice may not get distributed in time.

I'm just curious about something. One-person plan has a plan document prepared by prior TPA using one of the national vendor's volume submitters. It is not the TPA's own document. It is also not the vendor we use. Looking to control costs, wondering about preparing the H/S amendment only, rather than restate the plan document, think that works?

Here we are on 10-15, 1-person MP plan has not provided contribution info, so assuming no contrib was made by 9-15. We don't even know the required contribution amount. I think this is what to do: If no contribution amount provided - Cannot file 5500EZ. It will be late, will need to pay a penalty through the late EZ program, and file 5330. If contribution amount provided, but not made by 9-15 - Prepare 5500EZ for signing. Will need to show outstanding unpaid amt of contribution. Will need to file 5330. Assuming those are correct steps, an extension for 5330 was not requested. Curious what other practitioners have done in this situation?

So actually, because there is the option of directing one's account balance in a brokerage account, the pooled account, which appears to be historically valued annually, should be valued quarterly.

I'm curious how ag780 treated this. Similar, but larger, situation - new CPA believes that plan audit would be easier and less costly to actually include all participants that were excluded in past 5500 filings. The question then is how to bring back a significant level of assets. Not sure that showing as a Rollover is the best approach, but showing as the opening balance would have a significant difference from the closing balance of the prior year.

The pooled account is valued annually, so annual statements are sent out, rather than the PPA Notice.

Is there a guideline regarding how often participants in a non-safe harbor 401(k) plan need to be informed that there is the option to invest in a brokerage account? In this situation, participants are either in the Pooled account, or can pull out vested balances to put into brokerage account. They receive annual statements of their balances and vested amount. Information about the investment options is provided in the SPD.

Sole Proprietor has set up 5305-SEP and wants to set up a 401k plan for current calendar year and only contribute to 401k plan. No contributions yet for current calendar year. He will notify recordkeeper that he will terminate the 5305-SEP (seems that is how to terminate such a SEP?) Question: Can the PS feature of the 401k plan be effective 1/1 of the same year, which is prior to the 5305-SEP being terminated?

Kristina - first time hearing that a participant who is never reported as an 'A' would be reported as a 'D' ESOP Guy - yes thank you, I should have seen that prior to posting my question.

Small plan (< 10 participants) >On Form 8955-SSA, participant w/ vested balanced who terminated in prior year is required to be reported in current year filing. >Current year filing is being prepared during following year, during which said participant takes distribution (to be specific, 2017 terminee to be reported on 2018 form being prepared in 2019, takes distribution in 2019 prior to filing form) I'm curious the general approach - required to report as 'A' only to report as 'D' in following year, or just ignore?

Thanks much for the responses. Plan is a part of a control group - each doctor has their own plan. There is an equivalent plan with same provisions for the staff. Same investment options. Why keep plans separate at this point since restated plans have them set up similarly in spite of recommendations to merge them? Because they have always been separate and the legacy doctors feel they have more control that way. Mike - I should have typed 'fully vested' as plan is on 2/20%.

One person plan for a doctor - for the beginning five years of the plan, the doctor is not vested in the profit sharing contribution. Inasmuch as a plan is meant to be more permanent than 5 years, how to explain to plan owner that the money is theirs even if they are not vested at the current time in the first five years? (in this example, plan started when employment started).