TPApril

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.

Called up IRS on this. They said to fax a request with the 5558 asking for the PN to be changed, and to file on the correct PN

The Fidelity VS plan doc really provides minimal guidance on the treatment of Forfeitures.

Plan Doc says profit sharing forfeitures are to be used to pay expenses, or reduce employer contributions. Plan Sponsor declared $0 profit sharing contribution for last year, but there remains a balance after payment of fees. Makes me uncomfortable but can that balance remain sitting in the forfeiture account until a contribution is declared? Perhaps a contribution for that amount should be declared for 12/31 of last year equal to the forf account balance at that date? With no actual deposit occuring, would there be any affect on Plan Sponsor's non-retirement plan accounting?

Small dividend check under $25 deposited into 401(k) trust instead of non-retirement account. Minor, we think, but goal is to correct. Recommended approach - leave in plan, treat as current year contribution, and have plan sponsor write same amount into his other account from his personal checking Plan sponsor's preference - withdraw amount and transfer directly into correct account Just contemplating best approach.

yes, thanks! I'm thinking may be more advisable though to delay start of Roth feature (along w/in plan Roth rollovers) from plan year start 10/1 to next 1/1 to allow time for updated safe harbor notice and enrollment

9/30 plan year for safe harbor (3% ER) plan recently sent out their safe harbor notice. they are also in the process of restating the plan document in full, not yet completed, but to be signed prior to 10/1. One change is they are adding in a Roth feature. not sure if a supplemental safe harbor notice is necessary, particularly since the safe harbor is nonelective, rather than a match

Situation at hand - first time filer for welfare plan filed extension but has not yet filed. Lo & behold, it's not a first time filer as we learned that a 5500 was filed '4R' ten years ago, but under a different Plan Number. Therefore current extension had the right name, but wrong plan number. File under which plan number? As reflected on 5558, but might appear as if no extension filed As reflected on last 5500, but might appear as if no extension filed

that's a good question. because I wasn't thinking? I also wasn't thinking of top heavy minimum requirements...

So they are excluded from the x testing completely then?

piggybacking on the theme of this topic of equity v non-equity partners in a x-tested MP plan: Ee becomes non equity partner at start of yr., but is NHCE. The plan allows partners to receive less than 5% and even 0%. Is such a non equity NHCE partner required to receive minimum gateway of 5%?

no, that is why it was trying to be determined whether to file with the Medical or on its own, as was decided.

Yes that is the plan from this year on. I'm wondering about for prior years when the wrap was not set up?

Company offers three insurance choices for Medical, an employee can only choose one. Three Schedule A's are filed on one 5500. Employees may also elect Drug coverage, offered as a separate self insured plan. Can it be filed on same 5500 or does Drug have to be treated as a separate plan. (moving forwarded a megawrap is in place)

HR noticed they missed paying an ee a few vacation days in a paycheck a few months ago. In correcting this missed salary, would the 401(k) be considered late and require lost earnings, even though the 401(k) is being deferred, withheld and deposited at time of actual payment of the portion of the salary that is late?

Thanks! All that being said, have you seen in practice a 5558 trigger an audit, and if so, within just a couple months of filing the 5558?

Plan Sponsor of HW plan has never filed 5500 and is preparing all past years with intention to submit to DFVC. They have asked that 5558 not be filed for most recent year because it could trigger an alert to the IRS that they are not filing and they could be penalized. Both their broker and CPA have advised them this. I'm just curious if anyone has ever seen this happen (ie, is there any connection between the dept. that receives the paper 5558's and the audit departments?), and if so, within what time period? Because there are many years, it would not reduce the DFVC penalty, but I like the idea of having one less year be late.

Welfare Plan, covering a division of larger employer, terminated on 12/31/16 and brought into the larger plan effective 1/1/17, according to the plan resolutions. So at 12/31/16 there were participants in the original plan but at 1/1/17 there were none. Is this how to finalize the 5500 - For 2016 include all Schedule A's to show premiums, commissions, etc., but show zero participants? If they file a 2017 5500, the beg of yr count is zero.

Thank you. Recordkeeper says their dates reflect date received. I don't visualize asking ER for their bank records back to 2011 as the only other way to document.

Thank you for your comments. Belgarath - I thought one of the proposals (effective 2020?) was to change the definition of 'large plan', that's what I'm referring to. BG5150 - yes to other compliance issues, including a missed plan document restatement. None of the issues you list have popped up as this plan is in place more for employees than owners who have not historically contributed. RatherBeGolfing - I would love to use the mailing date, but all I have is the check date, unable to verify when the checks were mailed. If we do use check date, delinquent contributions are cut in half. Plan Sponsor says recordkeeper 'took forever to deposit the checks'.

Thank you that's excellent advice and I will take it (I recognizing you are offering an opinion). One more comment on the plan - it's the type of plan that will benefit if they change the definition of large plan to participants with account balances. Large number of low paid staff who had made eligibility, very low participation rates. Oh, one more comment, until very recently they were mailing in their contribution checks instead of uploading online.