ETA Consulting LLC

Don't confuse this with the annual participant disclosures under ERISA 404(a)(5). Good Luck!

You are correct. You should use the company's EIN. Cannot think of any reason to use the EIN of the PEO since they would have nothing to do with the 457 plans. Good Luck!

I would not challenge it when you immediately corrected the amount (especially when you have consistently met the requirement). Good Luck!

Yes. What you don't want is a situation where the loans are used as a method of circumventing the distribution restriction. But, you may (and some argue should while others argue should not) discontinue the payroll reduction. Good Luck!

You make an interesting point. I, too, have always reconciled the numerator in the 410(b) test to the number of employees in the ADP test. Did the same thing for ACP. Good Luck!

To answer this question, you must first establish whether the trust and the S corp are members of the same controlled group. We know that ownership of the trust is two-fold. First, the grantor (in your case) would be deemed to own 100% of the Trust. Further, the beneficiary of the trust would have their ownership calculated by the actuarial interest in the Trust. With this said, I would imagine that the husband and wife (collectively) would own 100% of the Trust. The same would apply to the S-Corp. So, when the dust settles, the husband and wife really owns 100% of the S-Corp and 100% of the Trust. So, to answer your question: Yes, they may both participate in the same plan. I would imagine that the documents are properly drafted to include both employers; the trust and the S-Corp. Not really sure of the mechanics of who is the employer paying the W-2 for the work on the trust, but any W-2 paid would appear to be from within that same controlled group. Good Luck!

Poje: Nothing to preclude a rollover when an age prior to 59 1/2 is used. That may be a consideration in order to allow individuals to diversify investments outside of the qualified plan. But, you make a good point Masteff: If I ever need a regulatory cite, I'm contacting you first Good Luck!

It's a non-issue. The basic rule of thumb is that you cannot wait until you are on the verge of getting caught to come forth voluntarily. It doesn't take too long to prepare a create a VCP submission, but you shouldn't delay when you know there is an issue needing correction. Good Luck!

No. Under examination imples that the IRS is conducting an audit. So, if anything is wrong, it would be too late to go to the IRS voluntarily. Good Luck!

That's the interesting thing (as you have pointed out), there is no stated requirement on what the attained age must be. I would not be the one to push the envelope to age 21. I have, however, drafted plans using age 45 for the non deferral or safe harbor amounts. This is a topic potentially subject to endless debate. Good Luck

This is correct. Whether a person is considered "eligible" for deferrals (adp) or match (acp) will depend on that person's class (and whether he is a member of an excluded class; for example hourly). However, coverage under 410(b) is tested against safe harbor excludable classes (i.e. union). So, if the individual is excluded (say for being hourly), he would still be included in 410(b) because hourly is not a safe harbor exclusion like union or non-resident alien. Good Luck!

There is still an 'argument' that the company imposed this standard and did nothing over the two years to follow up on the form. It's one thing to send someone through hoops; but when two years lapse with no followup, that could be an issue. Good Luck!

Has the QDRO been received and in the process of being reviewed? If not, then on what authority would there be to deny a distribution the participant is entitled to under the written terms of the plan? There is 'very limited' room to actually delay such distributions when a QDRO is 'actually received'. The plan's QDRO procedures should provide the details. Good Luck!

No. There are no restrictions on withdrawing after-tax contributions; there never were. This is a case where the IRS provided an example, but that did not provide a ruling on any suspension when after-tax funds where withdrawn. Just think, they are now imposing the rule on new after-tax contributions made to the plan after the merger; their version of correcting prospectively Good Luck!

You would hope that the document is written to allow it; otherwise you missed the boat for the year. This is one of the considerations when drafting a document; not to preclude someone who receives an allocation from meeting the gateway. Good Luck!

I'm with Belgarath on this one. Your loan availability is $28,000. However, since they are distributed ony from Deferrals, then you're limited to 100% of the deferral source. The loan is still under the $28,000 (legal) limit. Good Luck!

The father is a 5% owner through attribution; so yes. Good Luck!

Top paid group is terminology for HCE determinations only and has nothing to do with Key Employee determinations. Good Luck!

Attributed Match. It is the matching contribution on the excess deferrals. Many plans are written to forfeit these prior to the ACP test. Good Luck!

I understand your position, but also understand the IRS's position. As a rule, qualified plans MUST be valued at least annually. This goes a little beyond an arbitrary determination of value (which is what the IRS is implying the taxpayer did). Not agreeing with any position, but there wouldn't be a challenge had the sponsor had an appraisal performed by someone licensed to do such appraisals. Good Luck!

Your issue is that you missed the 415 funding deadline to have those contributions considered as annual additions for the 2011 year; not to mention deductibility. HOWEVER, there is an exception to that 415 funding deadline when the contribution was missed due to an oversight. My first approach would be to document this in order to ensure the contributions get treated as annual additions for 2011. I would treat deductibilty as a secondary issue; that does need to get addressed. You "may" submit under VCP (but there may be enough there 'already' to treat the contributions as annual additions for 2011). A submission would merely be added insurance. I would doubt the IRS would allow the deduction for 2011 (but there is nothing to preclude you from asking for it). You may, then, be looking at reducing the contributions for the current year in order to avoid exceeding the deduction limit (assuming your limit is already close to 25% each year). Good Luck!

Correct. This has always been an area where the client's best interests may have not been served. When you're skating around the large and small plan participant count limits, you don't want the additional count when all that was needed was to 'follow the written terms of the plan'. This would include forcing out for the $5,000 and under; and timely processing distributions when requested. Not being critical, but just a statement to add a little insight into how clients can save tons of $$$ by ensuring things are done timely. This was emphasized in these forums tons of time over the past; plus one

In my experience, you may complete each year on the Form for that year or use the most recent Form for all years. Good Luck!

In this case, the employees were provided an opportunity to elect and actually made their elections; the employer merely failed to honor them. Hence, the missed opportunity is in reference to that actual election; not the maximum matched amount. Based on the EPCRS, it would appear that you will provide the "full match", but only to the extent that the additional (full) amounts being deferred would've been entitled to the match. For instance, if someone's annual deferrals already exceeded 5% of salary prior to the missed amount, then there would be no correction for the match; since the missed deferrals wouldn't have received a match anyway. Good Luck!

It is for this reason that many ERISA attorneys tell their clients to "never rehire". There are rules that apply to that often require you to give credit for that prior service.