TPApril

On the theme of transferring money between plans sponsored by the same Plan Sponsor - can a participant in both plans, which are still active, transfer her 401(k) balance into the MP plan? Or since they are both still active it would not be allowed? My instinct says no, but i haven't had this question before.

It's been just over a year since you responded to my question, so I thought perhaps it's a good time to respond back.. For clarification, doesn't an FSA plan without a trust still need to file a 5500 (when there are > 100 participants)? It's just that there is no Schedule A since there is no insurance carrier.

I endeavor to leave out my own editorial comments. Turns out that with no owner related 401k contributions, the plan passes the ADP test, which was the main concern. Even excluding the owner who made and received zero contributions of any sort, so as to increase the HCE ADP for a worst case scenario, the test passes.

I'm so sorry for omitting one piece of info that is exceedingly relevant. The owner was in prison for the entire year.

Census reports zero hours for the owner of a company but maximum limit of pay. Just contemplating this before I get back to them - would he be counted in the ADP test as a zero? Is this W-2 pay?

With the upcoming 4/1/18 effective date of new disability claims procedures as related to plans which do not use an unrelated party to determine disability, I'm curious if there is a general push to amend these plans so that disability is determined by an unrelated party such as the Social SEcurity Administration or any licensed physician, or just leave as is and deal with the new, potentially more administratively challenging requirements.

I've seen 2 documents in use wherein the Plan Document is relatively generic and the SPD will be more specific and the only document that references actual insurance carriers, actual contribution amounts etc. In the two types of arrangements, say a sponsor changes carriers or the contribution amounts between ee and er, in which case is an amendment required?

I concur with Madison71 in thanking Tom for such an apropos find. Concluded - in this case there is indeed an early w/drawal penalty To be determined - getting the 1099-R issued for the earlier yr.

thanks for confirming. in this case, plan sponsor told ee the loan was paid off and never restarted pmts after being told it was still outstanding. ee is still active so no distribution event. complicating the situation - this was a year prior, but recordkeeper never formally defaulted the loan, so the 1099-R is being issued in current year, when ee is now over 59 1/2, instead of the year of loan default.

Participant defaults loan on 3/31 Participant turns 59 1/2 on 7/1 1099-R is issued after end of the year Early distribution penalty?

well, 'final' comp has been updated again. remaining safe harbor amount is just under $500. former recordkeeper will not make it easy to reopen account for this (owner's account is elsewhere) paperwork and original final distribution are over 180 days ago. based on your comments, perhaps the following solution: resend distribution paperwork pay check from prior owner to ira (will not reflect as coming from a plan) create 1099-r from plan if ira cannot accept, then I guess paying directly to participant with 20% withholding and 1099-R (highlighting how it can be deposited into IRA)

2 person plan - owner and nhce - terminated early last year due to business closure and all final comp was provided for safe harbor contribution which was deposited, and nhce account liquidated. owner account still exists so the plan itself still has assets. with the close of the year, accountant has determined there was additional pay that did not receive the s/h contribution. with no account to deposit to, what would the best way be to make up the s/h contribution of about $50?

David - good questions. In response company in liquidation effective mid-year. There is no more company period. Because it ended operations mid year, there were benefits offered for part of the current plan year that is subject to a 'future 5500'.

Company has gone bankrupt. They sponsor a fully insured Wrap Plan. Fees for most recent 5500 will not be paid. Is there any reason to file future 5500's and who assumes responsibility?

I'm curious how this is being handled today?

So alternatively, the loan feature can be removed mid year? (even with outstanding loans (to NHCE's only))

Takeover MP plan allows participants to either self direct in brokerage accounts, or choose the pooled account, no combination thereof. Participants in pooled account receive annual accrued statements only. Should they be receiving quarterly statements with updated balances?

I'm so sorry I misstated the circumstances. This is not a control group after all but rather an affiliated service group.

There exists a control group of a staff plan who receive safe harbor contributions and individual Partner plans who contribute on an xtested basis, but do not receive a safe harbor; all plans tested together. There is a new Partner. She would like to start her own plan on 11/1. Although her plan will not have a safe harbor feature, does the staff plan limit her ability to start 401(k) for herself on 11/1? She has never been a participant of any of the involved plans. Edit after receiving 2 responses below - this is not a control group, but an affiliated service group.

Company files its 5500s appropriately for 5 different benefits on separate 5500's. They are consolidating and creating a wrap plan document effective beginning of current year, with brand new plan number. None of the current 'plans' have an existing ERISA plan document. In addition to the resolution adopting the new plan and wrap plan document, do other plans which will be filing 'Final' 5500's need plan termination resolutions, given that there has never been a plan document to begin with?

I'm not familiar with using Forfeitures from one Source to offset contributions from another Source, even if both Sources are Employer contributions

ok now I get it, Plan Sponsor's intention was to use the PS forf to fund the Match

oops, I meant the invoice is far smaller than the remaining forfeitures

We haven't presented the circumstances yet though we anticipate the original idea of the contribution equalling the 12/31 forfeiture balance. New account and just trying to review options 1st.

Next year's invoice will still leave a significant balance so just as well not issue it. I find the plan doc so limited. This is what it says: 11.09. Application of Forfeitures. Any forfeitures occurring during a Plan Year shall be applied to reduce the contributions of the Employer. Notwithstanding any other provision of the Plan to the contrary, forfeitures shall first be used to pay administrative expenses under the Plan, if so directed by the Employer. To the extent that forfeitures are not used to reduce administrative expenses under the Plan, as directed by the Employer, forfeitures will be applied in accordance with this Section 11.09.