ETA Consulting LLC

This is a good question. I think that is called the contingent deferral rule in 401(k) that, basically, says that a matching contribution is the only thing that can be based on an employees deferral. Hence, you may not base a non-elective contribution on whether or not the employee defers; as doing so would violate this rule. Additionally, when you look at 401(m)(4)(A) of the IRC which defines "match", it is any employer contribution made on account of an employee contribution or deferral. So, arguably, if you based making a contribution on whether or not the employee contributed, then it must be a match. That would be my argument. Good question! Good Luck!

IRC Section 408(p)(5)(A). It's a SIMPLE IRA provision that does not consider the possibility that a "sole prop" or "partner" may not know their income for the year in which to base a deferral. Good Luck!

I would amend to remove the J & S from the plan. The percentages of PS plans that still have it are exceptionally low; especially after the 411(d)(6) rules were modified to allow for its removal. Good Luck!

Calm Down!!!! No. Your ERPA is for representing clients before the IRS. The IRS is a federal, not state, entity. All my clients are outside my state. Good Luck!

Let's suppose you were to obtain one for 10% of plan assets. It would, then, be 10% of Zero as each individual's balance is held in an IRA that they control. Good Luck!

No, those amounts are deducted as Regular Salary. When an employer pays an employee (let's say) $100, that employer would have an expense deduction of $100 for employee salary. When that employee defers $20, the employer's deduction for salary becomes $80. However, the employer will now deduct the employer contribution of $20 (since deferrals are treated as Employer Contributions). If the employee has not made a pre-tax deduction, then the employer would simply take $100 in deduction for salary expense and 0 in deduction for Employer Contribution. Good Luck!

True. There is also an exception if the contribution was missed due to an oversight. Hence, it's a non-issue on both fronts. It's a 2013 annual addition. However, it will not be deductible until 2014 (unless you're on a tax filing extension). Good Luck!

I don't think it does, so you should be fine. The only thing you cannot do is eliminate the QJSA in a 'pension plan' that requires it. I think it was back in 2003 when you were able to begin eliminating some of these options. Good Luck!

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You've seemed to account for each issue. 1) Contribution will be deducted in 2014 (year of deposit). 2) Contribution will apply against 415 limit for 2014 even though it is allocated for 2012 (and missed the 2012 funding deadline for having contributions counted in the 415 test). 3) Will continue to pass non-discrimination for the 2012 year. So, your question was not whether there would be an acceptable reason why the failure to contribute was due to an oversight that could lead to those amounts counting against the 2012 415 limit. FWIW, I, too, agree with your analysis. Good Luck!

I agree on "no". March 15th is not referenced. The rule is with 2-1/2 months after the plan year ends. Had the deadline explicitly stated "March 15th), then you would have position that since this date falls on a Saturday you would have until the next business day. Even in Form 5500s, 'then end of the 7th month following the month in which the plan year ends'; you don't get an extension (at least I don't think you do ). Good Luck!

I agree. It may be an accident on their part. If so, it's one that they will have to correct. But, as Lou S. stated, the SPD will be specific as to the definition of Plan Compensation used. You'd look for language to say "your taxable wages or salary, 'INCLUDING PRE-TAX DEFERRALS YOU MAKE OR ANY OTHER PRE-TAX". This is the language that would suggest that the pre-tax amounts will be added back to the 'taxable wages'. Good Luck!

No, you may still file the SF. Seems odd that there would be no place to put the Schedule A information, but that's perfectly fine. Good Luck!

I'm 'shooting from the hip' on this, but one of the main differences between W-2 wages and Withholding wages is the inclusion of amounts in income that aren't necessarily subject to withholding at the time they are incurred. Such items 'may' be a car allowance; or items that are generally added to Compensation after the year. Often, a reliable measure of withholding wages would be the amounts included on your last checkstub of the year. Again, I'm just shooting 'loosely' from the hip on this without going into the detailed analysis of Compensation definitions. Good Luck!

First, I agree 100% with Lou S. I would say, however, when identifying a problem, you may want to look at ways to make it 'not a problem'. Deductibility of contributions are based largely on the timing of the deposits to the trust. So, if you made $6000 in contributions in 2014 for the 2013 plan year, then you could look to have that $6000 deposit considered a 2014 contribution since it was 'actually deposited' in 2014. Just a thought to apply when ascertaining whether or not a problem really exists. Good Luck!

I've gotten some of my best VCP work from clients working with these accountants

Without reading much into the fact pattern, a MEP is still a single plan; one that is merely sponsored by multiple employers. Being a single plan, you are subject to the single 415 limit under that one plan; regardless of the number of employers you work for under the plan. Let's contrast this to a situation where you work for two different employers who each sponsors their own plan. In that instance, the individual participant would have two separate 415 limits (as opposed to one) since their are two distinct plans sponsored by two unrelated employers. This "may" address one of your issues. Good Luck!

If it were a Relius "Prototype", then you'd typically not rely on the statements of the investment firm. Chances are that Relius did, indeed, draft default amendments to the Basic Plan Document supporting the prototype adoption agreement; and they were merely not distributed. This is one of the main advantages of using a prototype as opposed to an individually drafted plan; the automatic amendments written by the vendor to keep the plan's language current. Now, whether or not the actual default language matches the plan's operation would be a different story. I would probably do a little more digging before pushing the 'group submission' button. Good Luck!

You'll find it through deductive reasoning as opposed to a statement "K-1 is not Compensation". We know it is not W-2. We also know that it's not withholding wages or 415 safe harbor. So, under what definition of Includable Compensation written in the terms of the plan would it fall under? Hope this helps. Good Luck!

Good questions. I've always been a fan of 'pick a uniform process and stick with it', the only exception being when there is some type of leverage to be gained from applying different procedures to different groups. In this case, I cannot see where two distinct election processes would create anything but additional tracking to determine who gets what form. Good Luck!

No. I cannot see this as a benefits, rights, & features issue because they are effectively the same. The only thing you are changing is 'what happens when a person doesn't respond'. However, everyone is still provided a chance to respond and make an affirmative election. Good Luck!

Someone is selling them a line of BS. When testing under 410(b) to prove that the plans passes on a standalone basis, it is not relevant whether the entity is taxed as a "C" or "S" Corp. Good Luck!

You are correct! The only time something similar would become an issue is when the individual is in a 403(b). Then you could have two plans of 'unrelated' employers combined for 415; because of the special 403(b) rule assigning the annual addition to the individual participant. Good Luck!

This is true. The 415 limit under a 403(b) plan goes to the individual tax payer; while the 401(a) plan will go to the 501©(3) company. Hence, if an employee of the 501©(3) has a separate business, they may be limited in what they can contribute to a SEP sponsored by their individual business. Good Luck!

I would not. Good Luck!