Bri

You mention 1000 hours for vesting, and no service (for eligibility?) but does the plan require 1000 hours for an allocation?

(And of course, thanks for leaving me a bunch of plans to have to take over on! 😁)

Wow, I'm not usually the participant in my posts! My wife and I are in an HDHP through my work, but due to some less-than-optimal coverage she is looking at enrolling in an individual ACA plan this week to start 2/1. I may stay on my work's plan (not calendar year). If so, does that affect my use of the HSA associated with it? I'd presume only my expenses would be eligible to be paid from it. Or does anything conflict such that I lose my eligibility? And the annual maximum contributions would be what, the individual limit times 1.083333? I don't know if her plan choice will qualify as an HDHP - if it does, is that fine? We'd be in two separate plans that qualify, so perhaps we could continue with the HSA (although my work wouldn't care about her plan's benefits or fund anything on her behalf) with the full 8300 limit? Am I close? (This is why I stick to the retirement plan side of the boards!) Thanks in advance. --bri

I'm not sure why people would bring in their LTPTs for anything else beyond what they're being forced to bring them in for. If you want them in for more, change your regular eligibility.

I suppose the document might say if the participants fail to give the trustees their investment instructions, there could be a provision that it falls back to the trustees' prudent judgment. And if a properly discloses SPD tells participant they can choose their own, and they then didn't go and choose anything.....

Millions for a 2-3 year plan sounds more like a 415 issue than it does a permanency issue!

Hey, if it weren't for changes like these, all our required CE sessions would be the same.....dang.....topics.....every time. I can only hear Derrin talk about net earnings from self-employment or management functions in ASGs so many times! 🔞

Basically run the test results twice, and merge the proper "halves" (allocations / accrual) as appropriate for delivery to file/sponsor.

I agree with Lou, but will also pile on with, if the gateway rate is 5 but you're running separate 401a4 tests for otherwise excludable employees, that gateway rate might not apply to him, so you'd want in the original scenario to have only one set of 401a4 testing rather than two.

Yup.

(And SEPs require a pro rata allocation with extremely limited exceptions)

If it's a safe harbor 3% nonelective plan, I believe EPCRS says to use 3% as the makeup QNEC. (Looking at page 85 of 140 in RevProc 2021-30 while typing this)

This is a weird one, indeed. It's not that the plan sponsor "knew" it was holding onto assets that should have been in the plan - they didn't know they'd computed the amount incorrectly. They did "timely" contribute the revised amount's differences, right? That "feels" like they wouldn't have done anything else wrong from a prohibited-transaction standpoint. Certainly we'd talk about it more otherwise here on the boards, no, if anyone else had considered this angle?

That's basically the idea, although the intricacies of the guidance are going to have some of the what-ifs..... And the new guidance also reflects what happens to FLTPT (former LTPT) when they meet the plan's normal eligibility. They'd be "normal" enough but still get to stay on the 500 hour vesting schedule. That's the part that kinda....sucks?

Was the guy a 5% owner back when he turned 70½?

The after-tax contribution wouldn't reduce his Earned Income. Do the PS calculation first to see how much is left to be a potential after-tax amount.

Is there a separate document section for plan termination, compared to the regular rules for distribution of benefits?

Kind of a smart spouse there to know the ERISA protection available!

Don't SH contributions typically get 12 months to be made? If so, then your real issues might be 2023 deductibility and annual additions tracking, since they certainly are late to be 2022 additions, but not late to meet the safe harbor.

1. Run? 2. VCP? 3. Do it right going forward and pray they don't get caught? Some accounting tricks might mitigate the problems (count the late deposit as being for "next year" such that maybe only 1-2 years are totally unfixable based on timing) good luck!

Don't forget that if 5.5% and the AMT provides a lesser lump sum than the plan's AE factors, then that will override your prior number. And the one-year participation limit before age 62 gets reduced down below the 14,779 as well, to something more like 7,243 at age 41.

Agree with Cuse - The deadlines are about the sponsor's tax deadline, so if the partnership itself is the sponsor, it'd make sense to tie it to that.

Different answer if HCEs are instead put in a class allocated a contribution credit of $0, rather than excluded by class?

This sounds like you're hoping to apply the flexibility allowed for top paid group determinations, but I don't believe that's provided for in the coverage rules. The only leeway I've seen on that one is when you fall back on the plan's entry dates under liberalized eligibility, as opposed to the straight reading of the rule (where you go six months out from the one year anniversary, even if the plan had dual eligibility and someone snuck in July 1 even if it that were earlier than statutorily required).

Oh, as a sole prop, then this could potentially be the company's final contribution in the year of termination. Subject to 404 and 415, of course. I was interpreting the OP as some rando wanted to apply personal funds towards his deferral ceiling before his distribution.