Bri

They can be - once they hit their year of service on 3/14/2022 they have six months to enter the plan so any DOP before 9/14/22 would be enough for you to be allowed to disaggregate them. But if you need them in the test, keep them in there at the 7.5% of 3,000

I think you're on the right track with the $225. No top heavy minimum from either plan is due. But, this person's also a statutory exclusion. If you run separate tests, they could get by possibly with only the 3% safe harbor on the 3,000.

You can do the algebra and solve it out perfectly, but trial and error generally works fine for one person. And then they'll end up with a nice round number like $2,000 because it was way too much work to math out the actual 1,992.73 you might have really only needed to allocate.

Did everyone get their NOIT and NOPB yet? Wondering if they can hide behind "we didn't do it right, so it doesn't count anyway."

Maybe he's referencing orphan match, rather than nonvested ACP excess. In any event, the actual reallocation of any forfeitures is determined by the plan document. Could be a yes. As for penalties, I suppose it's the usual - the IRS would have to find out first and this isn't the kind of issue that gives itself away.

I thought you could get a listing of all the returns coded as 2F.....or 2J. Did you click on the "Show Filters" option on the EFAST site?

That's right - an officer's kid doesn't suddenly end up a Key Employee the way an owner's kid can.

I suppose "Solo CB" is no more a marketing term than a "Solo 401(k)". If their document explicitly excludes anyone else but the owner/spouse, they could have a problem, but their plan might be using a "full-blown" document so it wouldn't matter for any practical purpose.

If you have no allocation conditions, then you don't get to exclude the terms under 501 hours. You can only exclude them if the hours/last day rules are the SOLE reason the participant isn't benefiting. (That's different from the sponsor just choosing for them to be a zero even if the plan would allow something nonzero.)

First thought is whether or not any distribution was actually permitted under the terms of the plan. If that's a no, then the proceeds have to go back to the plan and the flowchart for the fix-it process ends up completely different.

*especially* if it's a uniform allocation formula for the 5% (as opposed to individual allocation classes, where everyone might be assigned an identical 5% but only if that's the way the sponsor wants it)

How are they still receiving the cash if that option was eliminated? What are the normal allocation conditions in the PS plan and are the folks getting cash now NOT getting PS? Feels pretty facts and circumstances as to whether or not this is still hiding as a deemed CODA.

Actually it's getting to 1000 hours, rather than the last day, to qualify for a DB plan's top heavy minimum. Even if they don't work enough to automatically qualify for a THM, they might end up needing something that large, anyway, to pass the 401a4, depending on what the owner is getting.

Failure to distribute the related match ends up as a 401a4 issue, though, right? It's not really a corrective distribution occurring when it's simply the match being forfeited. Not sure if that buys you any extra time beyond 3/15 though.

Only the 50,000 statutory maximum gets reduced by the highest balance in the previous 12 months. You don't do that same lookback with smaller loan amounts. Those just have the usual 50% limitation.

Does the document spell out what to use? If the document gives you the leeway to use any 414s compensation, then sure, you MAY limit 414s to only periods of participation. (You don't have to, but you have to be uniform for all employees.) If you have separate participation comps (and a hearty "Blam!" to anyone who's forced that upon you) then I suppose you'd use the participation comp relevant to exactly what you're testing for. If you're testing the gateway then you're measuring nonelective contributions by the employer, so use the participation date applicable to getting nonelective contributions under the plan.

I think that's in reference to a missed participant, not a missed change by an existing participant.

Sounds like a reasonable correction method....

I think that's fine, actually. Lord knows, we always talk here about how they want a 5500 even when there were no participants or assets the ENTIRE year. It's their sandbox and if you have less than 100 on day 1, you get a pass on the audit. If they wanted the audit requirement based on the EOY head count, they should have said so.

That seems crazy, like you're just giving the guy an extra $1,000 because of the data entry error.

Did the form itself indicate its effective date? Did the employee indicate when submitting the form when it was meant to take effect? Does the Plan Administrator otherwise enact elections upon receipt? (Kinda hoping you can find a way that this was an improperly executed/processed form.)

When is the sponsor's tax return due, and will they go on extension? That will determine a lot of the answers.

I think the carve-out rule is technically separate from the normal disaggregation rules. So if you're willing to throw any otherwise-excludable HCEs in to your statutory ADP test, then you technically haven't disaggregated for coverage, nor discrimination testing.

Nope, those are 415(c)-induced catchup contributions. Which then excludes them from the test.

and if they want a true-up, it's easy enough to code software to do it on a recurring basis every week using "year-to-date minus prior" or your system's equivalent language.