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The vesting for those returns are as of the last day of the year being tested. This is consistent with any other time. For instance, the vesting computation period isn't always the plan year; it may be elapsed time. Under this instance, you'd use vesting as of the last day of the plan year. Why would it be any different? Good Luck!

You may borrow $36,000; regardless of whether or not you pay off the old loan. Should you take the 2nd loan without paying off the old loan, then your new balance will be $43,500 for both loans. Should you pay off the old loan and then take a new loan, then your balance will be $36,000. So, you may borrow $36,000 (since 1) that $50,000 minus the highest outstanding loan balance during the past 12 months, AND 2) that amount, when added to the current balance will not exceed $50,000. Now: If your plan allows for more than one loan to be outstanding at the same time, then you may take a new loan of $36,000. If your plan only allows for one loan to be outstanding, then you may pay the current loan off and then take your $36,000 loan. Good Luck!

Doesn't sound familiar to me. Good Luck!

You should be employed on the last day. Good Luck!

It does get complex, because you're simultaneously balancing several principles; taxation vs distribution availability. Merely changing the taxation doesn't change the withdrawal availability; or vice versa. One consistent underlying principle you'd typically want to maintain is that the participant should have the flexibility determine the desired taxable outcome with respect to the distribution being taken. Some individuals may want to take the taxation in the current year (e.g. withdrawal from pretax) due to low taxable income for that year. Others may want to take an available distribution from a Roth source to avoid as much taxation as possible for that withdrawal. So, it's only an additional designation by the participant. Good Luck!

Typically, the differentiation between distribution availability upon sources will be outlined in the adoption agreement. For instance, ER Match may have a different distribution availability than ER Nonelective; and you can typically always withdraw from Rollover if nothing else. I imagine your question centers around the Deferral Source actually consisting of two distinct types of money: Roth Deferrals and Pre-tax Deferrals. To me, when an adoption agreement says : A Participant may withdraw all or any portion of his/her vested Account Balance, to the extent designated, upon the occurrence of any of the event(s) selected under this... that seems to open the door for the participant to actually designate the source and promotes total flexibility. Good Luck!

Also, there may be some flexibility with funded an additional discretionary match to the other employees that meet the ACP Safe Harbor while still avoiding TH. Good Luck!

Yes. This is my thinking. If it’s the “beneficiary” of that owner, then how does that trump it from still being considered the account of the owner for plan purposes. If the owner is 70-1/2, RMDs must be distributed from the ODRO account based on the owner’s age. I just don’t see how that would invoke ERISA. Good Luck!

It would still be a solo(k). Good Luck!

Yep, the rule had caught me sleeping about 13 or so years ago when I had to answer questions about an individual (let's say a doctor or professor) in a 403(b) who wanted to fund a SEP through their self-employment income. I guess it's okay now, but many have been doing it over the past as if the rule never existed Good to know. I was just made aware of this change this morning. Almost got caught sleeping again. I'm glad it's settled.

Yes. That's what I'm saying. Had the Safe Harbor been a match, then you could exclude those employees from the test for failing to meet the Statutory Age/Service (which happens to be 2 years). But the fact that you have a nonelective with eligibility of only 1 year, then there is no way they would be excluded from the test. The Safe Harbor QNEC, for all purposes, is still a nonelective contribution; it's just one that can be used to exempt the plan from ADP Testing. Good Luck

When you're eligible for a 3% Safe Harbor Nonelective Contribution after 1 year, then you're eligible for a Nonelective after 1 year. The Nonelective that you're eligible for is used to meet the safe harbor 401(k), but it's still a Nonelective. Given this, it should be tested with any other nonelective received; despite the different (e.g. 2 Year) eligibility. Good Luck!

I agree with Bird, but would add one more important point. If your plan is written to a preapproved document, then the BPD may have already anticipated these issues and, hence, already include the language allowing for a distribution of balances in excess of $5,000 (regardless of participant consent). So, before you do anything, read the provisions on Plan Termination in your Basic Plan Document to determine the options that are already available to you under the written terms of the plan. Always remember, RTFD :-) Good Luck!

The plain rule has always been that plans are set up to be "permanent". I've always considered the recurring and substantial contribution issue to be just that. After you meet the standard (let's say 5 years of recurring and substantial contributions; and I say this loosely), then I don't see a challenge. On the other hand, if an employer sets up a plan and never funds it, then that could be an issue. The obvious work-around would be to set up a MPP with the formula of zero; letting the required funding of zero under the 'pension' feature trump the recurring and substantial rule. Do you have more details about the actual plan they are challenging with respect to how long it's been in existence? Good Luck!

Some plan documents actually provide these details. I'd 'start' with the Basic Plan Document so see if the particular items are listed. I think EOB has a chart as well. Good Luck!

I agree; as it is very easy to defend as 'reasonable'. Heck, you can't get any more reasonable than recognizing that earnings during the year are zero Good Luck!

That was my first line of thought; at the very least, differentiating the Compensation Received as a Union Employee from the Compensation received as non-union. I, personally, never delved into getting an understanding of how benefits of an owner can be derived from good-faith bargaining. At any rate, your initial line of thought does seem to address the mandatory disaggregation of union and non-union for compliance purposes. I'm sure others have more detailed insight. Good Luck!

Not really! It's something that has been done for decades in a 'blatant' attempt to circumvent the deadlines. I believe that more recently the IRS has began to deem filings utilizing this procedure as not having been timely filed. I'm not sure about this, as I haven't been able to substantiate it for myself, but I've read these things recently. Not sure if that adds any value for you. Good Luck!

Sometimes, the story is about everything that should've been done to prevent issues like this from arising. Liquidity has always been a priority when selecting the investments for a plan. In theory, there is no such thing as no buyer; there's just no buyer at the price being asked. This is also an attribute of liquidity (e.g. can I sell it quickly for what it's worth). Now that he's here, he'll probably end up taking a large loss. I would imagine the most important thing is paying out the employees the amounts they're entitle to under the plan. It would seem consistent to have the employees share in the investment losses. Then again, it was incumbent upon the trustee to guard against those investment losses. So, it is as bad as you suspect. However, it seems the only way forward is to liquidate at the lower value, terminate, and distribute. Good Luck!

Correct.

What is the plan year of the profit sharing plan? What compensation is being used for determining the profit sharing allocation for the plan?

You lost me right here

You're testing ABT and bringing in deferrals. You are, therefore, testing everyone who is eligible to defer. There is no accrual requirements for making deferrals each year. Good Luck!

This appears, on the surface, to be the operation that is most consistent with the plan's language. Of course, this deals only with the allocation of Employer Contributions outlined in the written plan. Good Luck!

DGEM (ASCi) did their amendments some time last year. Good Luck!