Bri

Feels like something you'd find in the actual plan document, whether eligibility would be preserved upon an amendment like that.

Targeted bottom-up QNECs to the ACP test with those rules. Sounds fun enough.

No issues there, it's not like they have to follow the rules for safe harbor plans' lengths. Just make it a full plan year with deferrals effective 12/23 or whatever. But as John referenced, no document means no plan means no deferring out of order.

I used to subcontract to an actuary who mentioned that Datair's BPD for (I think) EGTRRA had a disclaimer that the 110% rule would not apply in a "never had NHCEs" plan. After all, it is a nondiscrimination issue (and with no NHCEs, blah blah blah). Anyway, I believe she mentioned that the IRS had them take that language out for the PPA version, and I can only guess it's out of Cycle 3 as well.

Can you allocate additional benefits anyway so that if you at least test on 415 pay everyone could come out equivalent?

They'll be allocated those zero dollars and LIKE it. (Zero value versus "null" value, if you've ever had a Crystal report come out crappy.)

Yes. both sub-plans still need to satisfy the overall gateway.

RBD is still 4-1-26 even if lump sum coming later in 2026.

The DOL's missed filing rules are here: https://www.dol.gov/agencies/ebsa/employers-and-advisers/plan-administration-and-compliance/correction-programs/dfvcp

Sounds like you should do the AE adjustment from March to December on the benefit, and then calculate the lump sum as of December based on the adjusted benefit.

According to the ERISA Outline Book, the IRS took the position at a conference that you count ADP/ACP, but had no opinion on 402g excess. (The book's discussion also suggested you wouldn't count 415 excess distributions, since those were never proper annual additions to begin with.)

That was my thought, too - you can do it but you have lots of other things to pass, the ADP not one of them.

ha, this sounds like a plan I'm taking over. 20% after year 2 isn't illegal, so a terminated guy's going to stay 20 even though his cash balance plan was set up with a normally impermissible 2/20. Meanwhile the guy listed at 60% on the takeover records obviously will have to bump to 100.

😮noooo!!! Well, for the rest of us. Thanks for everything over the years, Derrin, and enjoy the wind-down!

I'm looking at the last "hey you owe a Form 10" correspondence the PBGC sent a client a year ago, and the text you provide here is similar but not identical. In fact, the PBGC did not use the passive voice that the reportable event "has happened." They directly said the PBGC found the unpaid MRC on the 5500 and immediately provided the website for more information on the filing requirements at www.pbgc.gov.

I suppose that depends on your coverage ratios of NHCEs/HCEs with the availability to access the feature.

Document will specify if non-owners are defined as an entire excluded class. Maybe not the adoption agreement, but the basic plan document. Not unreasonable for a marketed "solo plan" to have such language, under the category of allowing time to address document issues like this before a new hire can get immediately swept in.

You have to treat him as benefiting since he actually qualified for that $0 match, rather than not qualifying for it.

Sounds right.

Was it a pre-ERISA money purchase plan such that it already allowed for deferrals?

That's the basic idea - pretend you had the longest allowable wait period, and then the folks who would STILL be in the plan even then make up your non-excludable group.

The division of the employees is NOT based on whether or not they've met your specific plan's match eligibility condition, but whether they'd met the IRS statutory 1 year/21. As you have only a 6 month wait for match, it's readily conceivable that you have people who qualify for the match, but are nevertheless in the otherwise excludable group's test.

Your "main" coverage and nondiscrimination tests - and by that I mean the people who aren't excludable because they're short service - will include everyone who qualified for the safe harbor match. So those will pass automatically (presuming no other exclusions written into the document like job categories). Your test for the otherwise excludables - those who are in, but only because your plan's eligibility is easier than required - will include some people who are not eligible to receive a safe harbor match yet. As such that subgroup does not automatically pass its ADP/ACP tests. However, it's very likely you have no HCEs in that group (but not definitively the case automatically), and so those tests probably pass by default.

I think it was just a point a CPA or tax attorney had made at a session sometime somewhere, but I also don't recall whether that opinion ended up as any official position. But it sounded to at least be reasonably constructed.

Isn't the argument for this not being allowed that there's no justification for a contribution that can't be applied for 2024 to then be a 2024 deduction?