Bri

Well the VCP fix might be just to merge the plans back together (hopefully they weren't simply avoiding an audit requirement this way, too). Sounds like they only really meant to change the investments available for participants.

...and it's probably, as CBZ indicated, *immediate* upon rehire. (As opposed to waiting for the plan's next normal entry date for newly eligible folks.)

What should be the pro-rated limits on a one or two day long plan "year"? Or, a "plan day" as opposed to plan year!

One provision indicates what you need to qualify for a contribution (0 hours). The other provision tells you how much you'll actually get if you qualify (167 a month, essentially). It's easier than defining 12 different groups getting 1/12, 2/12, 3/12, etc., for groups of employees contingent on their month of termination. But I don't see a disconnect in their logic.

My wife got that email as well, since I actually prep her 5500 on the iFile site every year for her to sign.

Plan participants need (or at least, are required to receive) that information regarding the investment of their benefit funds, so I'd say yes.

A line parallel to y = 4x + 6 must be of the form y = 4x + C for some constant C as parallel lines have identical slopes. Since (5,10) is on this line, C is clearly -10 as the line must be y = 4x - 10 to get that ordered pair to work. And the line crosses the y-axis when x = 0, so y = 4(0) - 10, or at y = -10 *beep*

Safe harbor is required by statute within 12 months of the plan year end. So 2021 SH amounts may be deposited currently. Tax deductible deposits are due by the extended corporate tax deadline. So a contribution now for the 2021 SH can't be deducted on the 2021 return. Annual additions for the prior year are due within 30 days of the extended tax deadline. So if these SH amounts are going in now, they can't be 2021 annual additions, either. But hey, maybe having 2 years' worth of SH amounts in your annual additions helps this year. (And good luck if it was meant to be there as 2021 annual additions for that year's testing.) And I punt on the issue of someone not having any 2022 415 comp but needing a 2021 SH amount to post as a 2022 annual addition. Punting works better than a schoolyard lateral play.

It's normally done when the new plan year is made, it'll typically fill in the end date as 12 months forward. If you're too late (you've been posting stuff all year and find out later it'll only be a 9-month year), then I think you have to go into the change system IDs under utilities.

Are there any NHCEs getting the squeeze here?

They're great to include in the testing with an allocation/accrual rate of infinity. Hard to fail with that kind of math!

It will depend on the allocation formulas in the cash balance plan. If they're a "safe harbor" methodology (as opposed to different groups getting different amounts) in each plan then a straightforward 410(b) test should suffice. Of course they might WANT separate CB formulas, which could then lead to preferring to making employer contributions to the 401(k) after all.

I'll be interested to hear how the resolution to this suggestion might parallel the typical advisor office's voicemail message saying that trades left on voicemail can not be acted upon.

I suppose this looks different if the person's filing unincorporatedly, as opposed to an S-corp where he sets his own reasonable compensation number for his W-2. Was just thinking about a prospect whose Schedule C is jumping from 40k to 240k but we have no sense yet what the person expects in future years. Thanks!

Maybe just figure out a good minimum CB principal credit rate based on the age of the sole proprietor (3% if young-ish with a 5% ICR) and apply that to all the compensation. At least that way it's probably easier to squeeze the text into a checklist!

I'd be worried that if one suggests they only get the vested portion, that would hint at perhaps the plan didn't do something with the forfeitures earlier, when it perhaps should have by now. But the plan document can confirm that - the timing of, and directed use of nonvested amounts.

Starting next year, or paying the excise tax.

I was just wondering, since I never seem to find formulas like that in any documents I review. Seems like it would be a great idea for a sole proprietor, where income could fluctuate widely, and that way they don't really have to accrue a more-than-significant benefit until after the net earnings clear some amount the person would need for living expenses. Like, a contribution credit of "5% of compensation plus 75% of compensation above $100,000" where that could eliminate the need to worry about a big obligation in a "bad year". (Okay, maybe throw in a 401a26 failsafe, too.) Plus it's been a decade-plus since I even saw a super-integrated DC plan, and always liked the term.

So it would be pay after the termination date of the plan getting excluded.....rather than (specifically) pay after the termination of employment. I've never actually seen the rules regarding exactly how to prorate compensation against 401(a)(17) if you have a mid-month plan termination date, such as if you did terminate as of 12/15....whether you can use days/365 or 11.5/12 or only 11/12 for actual full months.

So it sounds like one 1099 for the earnings (current year) and one for the excess (prior year or wait are you saying it was paid after 4/15 so it's also a current year amount?)

Does the guy's W-2 show all 20,500 that was deducted? There's a 1,000 over-deduction which is then offset by the issuing of the 1099-R. (As opposed to "fixing" the W-2 to show just 19,500 in the first place...)

Does the plan include severance in the definition of compensation? Gotta be sure on what that "severance" really is, too. And if you're excluding a portion of eligible compensation, but not that of the doctor's, will you have a 414(s) issue?

Sounds like the -11g amendment is getting adopted more than 2.5 months after the end of the plan year, so you would indeed not see it in the valuation results for year X.

If they're legitimately assessed fees, the money should leave the plan to arrive at your office. (Why use a suspense account for it, other than maybe to collect them all at once and write one bigger check at the same time for you?)

Hopefully you've got enough flexibility in your document, and demographics, that perhaps cross-testing a 1% "PS" allocation to one NHCE would be enough.