R. Butler

You are correct; I didn't state my question correctly. I meant to say submit the exicse tax to the trust rather than give the notice to employees. Plan sponsor is consdidering the VFC Program; thta gets them out of the 5330. Paying the otherwise applicable exise tax to the trust would get them out of the VFC notice requirement.

What if the contibutions within 180 days, but the lost earnings were remitted outside of that time frame? Can you still submit the excise tax to the trust rather than file the 5330? Thanks for any guidance.

Co. A as a regular part of its business serves an investment rep. Can Co. A serve as an investment rep. for its own plan if it will receive compensation? I'm being told that isn't a problem, but it seems to me that irrespective of any PTE that there is a self-dealing issue. Am I missing something? Thanks in advance for any guidance.

Actually individual was not a participant, but had satisifed eligiblity. I refer to the employee as a participant because the document essentially treats such employees as participants who terminated with 0% vesting. The document essentially provides that if the employee terminated without a vested interest in the plan and is later reemployed the prior service will be disregarded if the number of consecutive 1 year breaks in service exceeds 5. In my situation, 2010 is both the rehire year and the 5th consecutive 1-year break. Thank you for your help.

Agreed, but the document seems to specifically apply the rule to rehires in this case. Thank you for your help.

Participant terminates in 2005 after working 600 hours; has a break-in-service in 2006, 2007, 2008 and 2009. He is rehired in December 2010, worked 100 hours. Does 2010 count as the 5th consecutive break-in-service whereby prior service is disregarded? My inclination is thta it does, but obviously not positive. Thanks in advance for any guidance.

Plan sponsor forgot to submit the 2009 safe harbor match due to one hce. If they submit now will that be subject to 401(a)(4) testing? My inclination is that it will be since we are more than 12 months past the end of the plan year. Thanks in advance for any guidance.

Just got a similar issue. Plan sponsor wanted to terminate a SIMPLE 401(k), but failed to execute the resolution prior to year end. What actually happens if they terminate now for 2011? They use the 3% match and no one is contributing. I'm just curious about the consequence. Thank you for any guidance.

Plan sponsor wanst to adopt a qualified plan. Plan sponsor currently has a SIMPLE IRA & failed to give notice of termination prior to the 60 day election period. It is my understanding that if plan sponsor adopts a qualified plan during 2011 that it invalidates the SIMPLE IRA and that contributions made during 2011 would be considered excess cotnributions. Is there anything that prevents the plan sponsor from informing employees today that he is going to adopt a qualified plan during 2011 and that if that they continue contributions to the SIMPLE IRA they will be excess contributions? Thanks in advance for any guidance.

Thank you.

I've read Appendix B, Section 2.01 This plan uses prior year testing. Both correction examples provide that the corrective contribution is allocated to the eligible NHCE's for 2005, pro-rata to comp. Paragraph (1)(b)(iv)(B)(1) specifically applies to plans using the current year method. It does provide that the corrective allocation can be made to the account balances of those employees who are still employees during the year of correction. Even though rhe plan uses prior year testing; I don't see a reason why the principle still wouldn't apply. Having said that can an argument be made that the QNEC can be made to only those employees who actually have an account balance? We are still going to have 40-50 employees without balances getting a $2 or less QNEC that they will never actually see because any fee will eat thta up almost immediately. Thanks in advance for any guidance.

Plan fails 2008 ACP test. Refund required was $80; it didn't get made. Using the 1 to 1 correction plan sponsor can make the refund and then make a qnec of that same amount. The qnec should be allocated pro-rata, based on compensation, to all eligible NHCE's. The difficulty is that there are close to 100 eligible NHCE's. Is there a deminimus amount before you have to allocate to a participant? Thanks in advance for any guidance.

Employer A & Employer B have common ownership, but not sufficient to be a controlled group. They aren't an affiliated service group either. They each sponsor their own plan. Every so often employees will switch between the two companies. Is there any issue with each plan recoginizing service with the other employer? These aren't really predecessor employers, but I don't see an issue with it. Want to make sure thay I am not missing something though. Thanks in advance for any guidance.

That is the answer we want, but I'm a little jittery. Fortunately not self-directed. Insurance in plans does not make sense to me, but if they are going to have insurance, they should pay it directly from the side account. Eveen if we could somehow get the insurance company to return premiums it would take too much time to make it happen. It seeems to me plan sponsor has 2 options: 1. Treat it as a contribution to the investment account 2. Amend the plan to eliminate the last day requirement. Other thoughts are still appreciated. Thank you

Profit Sharing Plan has life insurance. Plan has a 1,000 hour/last day requirement for a contribution. A participant just terminated, the plan sponsor wrote a check for his insurance premiums already. Participant won't receive a contribution. Is there any argument that his distributable balance can be reduced by the amount of the insurance premium? I don't see it, but wanted to check. Thanks in advance for any guidance.

TPA firm has a seprate distribution account through which they will run non-rollover distributions for various plan sponsors and then handle the tax withholding and reporting. Are there any concerns with that setup? Thanks in advance for any guidance.

We had a plan sponsor that filed 19 days late. IRS sent letter. The DOL instructed us not to amend the filing, but to essentially just act like we initially filed under DFVC. The DOL rep said just to mail a copy of the filing minus schedules to the DFVCP with applicable penalty amount.

We used IFILE for all of our 5500's; had very few issues.

It will be close. Mostly done, but we a 11 or 12 stragglers who we can't get to either register for their crdentials or maybe they've registered, but not signed. We also have about 3 or 4 audits out & I am worried about gridlock on 10/15.

We had a plan two years ago that was penalized for late filing of the audit. The audit was months late, not weeks, but they would have probably have been better off to wait on the audit & then file under DFVC.

Unless I'm mireading it the DOL is not telling you to file an incomplete report, Janice recommends that. Janice then goes on to site a Q&A which for some reason instructs you on how to do it, but tells you that such a filing is incomplete. My question is still does submitting an incomplete filing really help you if the DOL immediately gives you notice that the filing is incomplete? Haven't you elminated the DFVC option?

Plan sponsor files a small plan 2007 5500 via DFVC in June 2010; paid their $750 fee. Turns out the 2008 filing has not been made & the 2009 filing will more than likely be late. Both will be large plan filings. Can they apply the $750 paid in June to reduce the $4,000 DFVC fee for 2008 & 2009? Thanks in advance for any guidance.

We have a similar issue. I am a little leary about Ms. Wesgin's response in the EFAST era. I am concerned that filing an incomplete 5500, would just hasten a Department of Labor notice and reduce the amount of time that you have to file under DFVC. When we filed by mail you had a little lag time and generally the initial late filing notices came from the IRS and not the DOL. Will we get IRS notices in the electronic filing era or are they just going to come quicker from the DOL? A little twist to the same question. Can we buy time by filing the incomplete 5500, but knowing that it will be incomplete go ahead and send the 5500 & DFVC filing fee now. If the DOL sends a quick notice, will plan sponsor be covered since they attempted to use DFVC? My bigger concern is that the plan sponsor gets tagged for something more than the DFVC fee. Thanks in advance for any guidance.

Filed form 5500-SF. A form 5558 was timely filed extending the deadline, but we neglected to indicate on the form. That has happened a handful of times in previous years; we would just wait for the IRS notice & then respond with a copy of the form 5558. With the electronic filing I'm a little more uncertain of how we should handle. Should we amend the filing and check the box on the amended filing? Thank you for any guidance.

No 410(b) issue. The sole-propreiter doesn't benefit. It soley for the employees & none of them make enough to be an considered an HCE.