Bri

But K-1s aren't wages subject to FICA.

Figure out what month the actuary elected last year, and you can see that on the SB where the rates are listed and the applicable month is indicated (0 for when the rates are the month including the valuation date). You should be able to find the rates for this year's version of that month in table 3A. Isn't 2A just to show how the corridors are established?

If they're related, the employees would not have had a severance of employment with the (overall combined) sponsor, so benefit elections shouldn't typically be available.

I believe it's one of those Secure 2 amendment things, just gotta keep track of what you did ahead of executing the amendment later this year.

The loan paperwork may also have a "payable on demand" clause to it to cover such a situation where the plan's trust is going away to let the participant know there's not going to be a loan any longer. That too should easily establish a default date (and I acknowledge to @fmsinc that the loan wouldn't yet be in default but eventually that bell will toll for the participant to pay up sooner than expected).

Sometimes I don't realize the original post is in the 401(k) section, but I do lots of DB plans too, and no such "account balance" exception exists there.

You are indeed meant to add the number of January 1 newbies to the prior EOY count. And if that means 118 now turns into 121, guess what....

I'd think no issues, just like any ongoing plan other than maybe the termination distribution is looming faster where you don't want an RK to discharge a defaulted loan as everything else is getting distributed.

Are you testing otherwise excludables separately or at least carving out? Usually no need for that subgroup to utilize a safe harbor. Like, if everyone in the "main test" is getting the SH and probably none of the OEXs, then their OEX ADP test might not use a SH but should pass without HCEs. And who gives OEXs top heavy minimums any more, really?

If you can argue when the deposit started being late, leading to the 5330 filing requirement, that should guide which year to file for.

My guess is they'll either work great (common RK platform DC plans), or they'll be horrible (trustee-directed pooled assets with spousal consent).

If you're going to general-test the allocations anyway, is it an actual problem to no longer potentially have the safe harbor uniform formula alluded to in that Regulation? (And I apologize, earlier I missed that the DC was actually two distinct plans.)

you need to state in the CB document that the 5% THM will be handled under the DC plan. but then, sure, the person needs to get a total of 5% and 4 of that can be the match. insert disclaimers about gateway minimums, though, here.....

Figure out the passing QNEC level and figure even if they'd all been auto-enrolled at something lower, they would have needed more corrective amounts anyway to pass the ADP? Obviously going for a "this feels like a reasonable correction" approach

oh absolutely, that'll be easier than setting up the commutation functions from scratch (which is why I pointed to a table of q values, depending on how much "first principles" were going to be utilized.)

you mean, like, here are the q's and you can take it from there? i found this on the SOA site.... https://mort.soa.org/ViewTable.aspx?&TableIdentity=831

Isn't that just the rule for *safe harbor* pay period matches?

Isn't this one of those things, too, where the DOL's rules and IRS's might not perfectly sync in terms of leeway, too?

Could you argue that issuing the ACH directive to the RK, as part of the contribution submission, is an official move to segregate the assets as a determinable payable? Akin to handing them over a check that the RK lost behind a desk for X months..... I do think the DOL side, the participants got their money as of when they should have, seems clean. The IRS side (for the possible PT) seems more of the issue here.

Have the plan deposit the $35 in a checking account in the name of the plan and pay the guy from there, no fee. If the employer messes up 10 times, does the recordkeeper get to milk the guy's account ten times?

I think you let him take the whole thing to his rollover, but warn him up front that some of that amount is going to be deemed an ineligible rollover contribution and will be reflected as such on the separate 1099-Rs. If he wants to avoid the hassle he can wait, but it's his call.

then yes, while the 5500 is asking about the late employee 401k amounts, but your actual corrective measures for the match include earnings on top as well.

Does "er deferrals" mean the corresponding match?

Yes, it sucks not catching and fixing it by December 31 of the same year. The original PT was over two tax years. The new 1-1-25 PT only gets multiplied by the 15% once.

the W-2 is going to show the too-big deferral, but the 1099-R will show the corresponding addition back to the income. (And the code 8 is right, a 2026 distribution taxable in 2026.)