Bri

So I just heard from the enrollment folks at the IRS that they will not grant any CE towards my ERPA renewal, for studying for (and passing) at least one Enrolled Actuary exam during my 2019-2021 enrollment window. Guess I've got to download some recorded sessions this month. Grrrrr...... How is this not legitimate continuing education? What, it's not a "CE program" with an IRS-issued certificate? (If there weren't going to be a delay between my ERPA expiring and being able to apply to the JBEA, I'd just abandon the ERPA credential. EAs get higher ability to represent taxpayers than ERPAs.)

"I don't know why. What did you do with the money after you got the check?"

I think the way it works is that, the grandparent's interest in A isn't attributed to the minor child, since minor child owns less than 50% of A. So minor child isn't owning 100% of company A, just 25%, and you could be in the clear.

Sounds as though they're excess annual additions, rather than either deferrals (402g) or contributions (401k3).

The instructions are pretty clear that a one-participant plan can't file on a 5500-SF, so I suspect they'd counter that no valid filing was done at all. (Kinda like if you try to paper-file when you're not eligible to do anything *but* electronic filing of the EZ.)

Does this argument align with the usual questions over which plan has to refund the over-26 amount? Neither plan is going to have excess deferrals, just the participant. So I'd think in theory the participant can tell either/or what amount has to come out, and if he might be able to leave some in each plan such as to avoid leaving the match hanging as an orphan.

total, regardless of the plan's definition for allocation purposes. 404 cross-references 415(c)(3) for the definition of compensation. (And you get to use full year pay even for partial-year participants.)

Man, that’s brilliant and abusive all in one 😁

Or, throw it in early for next year.

The key, obviously, is to make the HCE actually ineligible by job title or other mechanism, as opposed to having him be eligible but just in a group accruing $0 benefits.

This had me thinking - if someone's changed from NHCE to HCE, they lose the right to extra gateway. (2 plan CB/PS combo with safe harbor 3%) They'd still get a 5% THM in the DC plan either way, but if gateway was 7.5% less the CB accrual piece, has the right to that been accrued right at the 1-hour mark since safe harbor triggers gateway? The plan doesn't technically HAVE to cross-test if other ways to pass 401a4 can be found. Not that it wouldn't be cross-tested, but it seems like gateway's not absolute, and therefore could be not so much of a cutback.

Oh, so you get 2020's entire income included in the benefit limit calculation, since it's too late to deduct anything for that year. And then you go forward with the 1/31/2021's funding amount getting deducted on the 2021 return? I suppose if you're using calendar-year-within-plan-year compensation, why go Feb. to Jan. and cut it close now, when you could probably get the same basic result with more than just the one month difference between the year-ends...

It's the company's tax year that governs the timing rule.

Maybe there's something in the Contributions/Salary Deferrals section of the document that would address any timing of contributions rule inherent to the document itself, as opposed to an "outside" DOL rule?

So hey, what if there's a first, vested, accrual (in my case, a cash balance credit) as of 12/31/2020 for the owner and no money's been put in the plan by his RBD of 4-1-2021? And does the answer change if the plan was adopted before the RBD, such that "we knew this would be due...." (I expect the RMD to be paid via an in-service distribution of his entire benefit so that he can use the DC method, too, and roll the rest to his IRA. That's got me thinking about an interest adjustment for the late payment, too.) Any thoughts appreciated. thanks. Oh wait, am I okay since the 4-1 date would have been the 2020 RMD which was based on $0 accrued benefits, and then at some point in 2021 we adjust for the new 2020 accrual? Getting my DB/DC RMDs swirling in my brain. -bri

I actually thought you were asking how they were deducted from payroll, which is doable but not actually mandatory.

Legally fine. Any "issue" is HR's problem 😁

The CB plan has an actuarial equivalence definition to determine the monthly benefit. If the plan writes it own monthly checks, there ya go. Otherwise, an outside insurer would charge its own proprietary amount to make those monthly payments. (Higher or lower than the theoretical balance.)

Code 3H is how you indicate a controlled group, similar to how you put 2J for the 401(k) arrangement. And a controlled group is still a single-employer plan, indeed. You may want both of your entities to adopt the plan, though, if they haven't already. Fidelity should have a supplemental page to list adopting employers. I suppose it's your choice which you wish to have be the primary.

Doesn't the plan have to buy a taxable annuity (with survivor benefits) with the single payment otherwise due?

Surprised nobody bothered to confirm that J&S does not apply to the plan.

How about going in under VCP?

If a plan wants to amend its rule for crediting interest to folks taking a lump sum (before: pro rata credit up through payment date, after: no such partial year credit), is that deemed a cutback even if done only prospectively on future distributions? I could argue that my annuity value drops if I won't get that extra interest credit from 1/1 of the year I turn 65 up through the actual NRA and take my dough. But if anyone knows of an exception or if there's been any IRS guidance, that'd be cool to learn. Thanks. --bri

I suppose this ties into the argument as to whether or not to go back to get a designation that's newer but already superseded. I had the QPA before the QKA came along, so what does that really "add on"? (Is it a daily-val section, or something like that?) At least the CPC felt like adding on to the QPA.

I think that in the past, our place's "distribution department" has set up taxable (non-IRAs) accounts for the zero to a thousand folks. (As I recall, we contract with Penchecks for our auto-IRAs, but they could set up non-IRAs for the under-1000 amounts.) So it's basically the same admin process but with a different tax flavor.