Bri

If only withdrawal fees worked like PT excise taxes.....

At that age wouldn't a DC plan get him a higher maximum?

oooh, I'll start with the easy one: Failure to follow the plan's written terms. Hopefully that triggers the "we don't have to be your TPA anymore" clause in the service agreement!

Well we haven't figured out if the guy would qualify as Key under the 1% owner test.

A SH 3% nonelective amount is part of the rate group calculations, whereas a SH match is not. A match is still part of the average benefit percentage test (along with deferrals) though.

Is he actually asking whether it counts as a component of either W-2, 415, or 3401(a) wages?

I look at it as, you're not failing coverage, but rather you're failing nondiscrimination (or, at least, there's still work to be done), if you have less than 70% benefiting with a non-uniform formula but over 70% getting "at least something".

obviously a DC plan might have an exception to its last-day rule for retirees. An ERA definition can inadvertently trigger an allocation you weren't expecting, especially when the allocations aren't "individual groups." But otherwise, yeah, what benefit is that definition bestowing upon anyone?

How about a 20-pound vat of glue for your portion?

That sounds appropriate, but really comes down to the Plan Administrator interpreting the document and its standard operating procedures conforming to Its interpretation. So if the bonus were a separate paycheck, he'd have gotten $200 total that week, I suppose.

Wait, isn't the problem just that the guy has too much take-home pay, but the correct plan amounts were deposited? Seems like the plan is actually in good standing but that the guy's next paycheck needs to have six months' of deductions properly taken off the gross.

No, matching contributions do not count towards (or "trigger") gateway minimums.

of course they could roll the proceeds to an IRA, avoid the 20% withholding, and then turn around and raid the IRA without mandatory withholding.

I always imagined if I had my own company I'd make the plan as legally unappealing as possible for the staff - pooled investments, no ISW or loans, QJSA requirements, no payout until 65+5....and then I'd do the triple-stack match nobody would want to sign up for

Maybe try for a PBGC coverage determination after there's nobody left?

just get them to re-sign-up for the $X per paycheck as you claim it's not always obvious whether they'd be above or below 3% each time.

Yes, if the spouse's consent was not given nor witnessed, then the spouse is still the legal beneficiary. But that doesn't prevent the participant from taking funds from the plan. If the spouse is NOT the beneficiary, it's because they allowed it by signing away their right to death benefits. So too bad on them if the participant elects a withdrawal.

Ages up to 70 are at: https://www.law.cornell.edu/cfr/text/26/1.401(l)-3 But I don't have anything for older ages.

I thought it was the opposite - you don't have to offer annuities but if you do then the spouse has to agree to any annuity version that's not the QJSA. Yeah, been a while....

I would think there's one value per person for 414(s) compensation as used in the testing, as it sounds that these plans are being aggregated to pass their stuff. And as such, one value to use to determine the minimum gateway. (happy to be wrong) Participants always enter both plans at the same time, right? (With only the comp definition different?)

1099-Rs show zero quite often simply as a result of being a corrected form, so I suspect nothing's preventing them from being generated almost "voluntarily"...

I'd suspect not - so there could be multiple decisions to make - a) can the fees eat the balances under the plan's terms, and b) how much is left to pay after *that* and whether a 1099 would be specifically required based on the actual payment value. (And I think the $10 is an aggregate total, not any one individual payment to the person, right?)

Isn't the 1099-R cutoff $10?

Guess it depends on what the document says...

If the employee had a legitimate termination of employment, took a withdrawal upon that distributable event in the year of age 55 or later, and then was later rehired, I would think the withdrawal still was exempt from the 10% because that's determined at the time of the withdrawal, no?