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Bri

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  1. Like
    Bri reacted to Mr Bagwell in Forfeiture when there is no distribution.   
    Look for the term "Forfeiture Break in Service" in your plan document.  That's what ours uses.
    After 5 Breaks in Service the non-vested funds are forfeited.  I'd guess the first Break in Service was 2019.  Forfeiture in 2024 is right on track.
  2. Haha
    Bri got a reaction from Dave Baker in Thank you Dave and Lois Baker and Colleagues   
    (And of course, thanks for leaving me a bunch of plans to have to take over on!  😁)
  3. Like
    Bri reacted to Paul I in Last day of Plan year   
    The allocation condition to be an active employee on the last day of the plan year typically applies to employer contributions such as non-elective contributions or matching contributions (allocated annually).  The fact that the last day is on a Sunday is not an issue for employees who are continuing actives.
    The common decision a plan administrator has to make is whether an employee formally terminates employment and/or retires on the last pay date (6/28 in the question).  Some plan administrators take the position the last day is satisfied if the employee worked on the last available work day.  Some plan administrators take the opposite position.  Some plan administrators consider the reason for the termination (retirement, disability, voluntary termination, involuntary termination).  Some plan administrators look at payroll practices so if an employee is paid for a pay period that includes the last day of the plan year, then the employee was active on the last day.  Some plan administrators look at how the last day is defined in their health and welfare plans.  Whatever or however the decision is made, it must be applied consistently and uniformly to all similarly-situated employees.
    If the plan is top-heavy, the plan could exclude an employee who is not active on the last day from getting the top heavy minimum contribution (if there is one).  Again, be careful that the decision is applied consistently and uniformly.
     
  4. Like
    Bri got a reaction from Aca in Combo plans - testing+top heavy   
    Well the first thing regarding that - 
    The plan documents probably indicate how the THMs are allocated in either, both, or (perhaps likely) just the DC plan.  If the DC plan document says all the non-keys get 5%, then they get that regardless if TH could have already been covered.
    The rate of accrual in the CB plan doesn't matter as much, like how DC plans can sneak by with a lower THM rate if no Key gets to 3%.
  5. Like
    Bri got a reaction from truphao in statutory exclusion for ADP ACP test   
    Technically, this #2 guy is a statutory exclusion, like let's say the guy termed on 9-15-2024. 
    But the IRS allows for multiple interpretations for plan sponsors to take on how they sort out these people.   They'd be okay if you didn't consider them excludable, since the plan's entry date for the person would have passed on 7/1.  They also permit the interpretation to say the employee stops being excludable right at the 1-year anniversary date in March.
    (I've used software that lets you choose the interpretation your sponsor wants.)
  6. Like
    Bri got a reaction from Lou S. in statutory exclusion for ADP ACP test   
    Not quite, if the first day of the next plan year comes up sooner, that takes precedence over the 6 months.  See 410(a)(4).
  7. Like
    Bri got a reaction from truphao in statutory exclusion for ADP ACP test   
    Not quite, if the first day of the next plan year comes up sooner, that takes precedence over the 6 months.  See 410(a)(4).
  8. Like
    Bri reacted to Lou S. in Who can establish a solo 401(k)?   
    A business (sole prop, partnership, corp, etc.) must be the sponsor of a qualified plan such as a 401(k) Plan.
    If the plan never has contributions other than the initial rollover, the IRS could challenge the position that the plan was intended to be a permanent retirement plan from it's onset.
    Now if they are expecting earned income in the future to make contributions to the plan and are establishing the plan now to accept rollovers with the expectation of future contributions, keep good business notes to show the plan was intended to have contributions because plan permanency is a facts and circumstances gray area sometimes.
    But if they are just expecting passive income going forward, then this probably won't pass the smell test.
     
  9. Like
    Bri got a reaction from Lou S. in 2023 Profit Sharing contribution made to 2024 PEP   
    If the transfer-to-PEP paperwork mentioned transfer of *all* assets/liabilities of the prior plan, that should sweep up the receivable as well, no?
  10. Like
    Bri got a reaction from Lou S. in Combo plans - testing+top heavy   
    Well the first thing regarding that - 
    The plan documents probably indicate how the THMs are allocated in either, both, or (perhaps likely) just the DC plan.  If the DC plan document says all the non-keys get 5%, then they get that regardless if TH could have already been covered.
    The rate of accrual in the CB plan doesn't matter as much, like how DC plans can sneak by with a lower THM rate if no Key gets to 3%.
  11. Like
    Bri got a reaction from Bill Presson in Termed/Retired prior to Normal Retirement Age   
    And you've got the "service for vesting" filled with that smaller number of years, rather than the plain "service" number of years?  And it didn't already have the 100% vesting error in the prior plan year's file, so that it would have just rolled that forward?
    I don't recall if I've seen that kind of thing screwed up before, so I'm at least pondering a "verify absolutely everything in the employee record" approach and hope Relius would do it right if it is just a case of missing a datum spot in the software.  Heck, I've messed up stuff myself by entering 2003 for termination dates instead of 2023 already this year.
  12. Like
    Bri got a reaction from Bill Presson in EACA related   
    I think there's a 10-employee minimum for the EACA rules.
  13. Like
    Bri got a reaction from Jakyasar in EACA related   
    I think there's a 10-employee minimum for the EACA rules.
  14. Like
    Bri reacted to CuseFan in K-1 Income & Cash Balance Contributions   
    Partners K1 is their income net of partnership expenses but their retirement plan contributions are deducted on their 1040. Without knowing details, I assume a reasonable 415 limit had already been established such that having a very low 2023 plan compensation after all adjustments to and deductions from income does not cause issues there.
  15. Thanks
    Bri got a reaction from Peter Gulia in How many actuaries provide retirement services that don’t require an actuary’s special skills?   
    I would think most pension actuaries don't have their fingers as much in the DC pies, simply because most DC admin work typically can be done by someone cheaper to the TPA business owner.  Aside from non-discrimination on combos and 404a7 impacts, the actuaries I've worked with never touched any DC plans, and now that I'm doing actuarial work there's a corresponding "DC person" to handle their half.
  16. Like
    Bri reacted to BentoBox in 401K did not distribute to correct individuals   
    Just my two cents.  I would first confirm if the distribution actually went to the incorrect beneficiaries; because the suggestion that a portion of the benefit goes to the son and a portion to the granddaughter sounds a little unusual. I would check the terms of the 401k plan document to confirm who the benes are in the absence of a bene designation.  Is it the estate; or are there identified individuals to be treated as benes in the plan document (e.g., children, grandchildren, siblings, etc)?  If the beneficiary truly is the estate (which is typical), you would acquire the estate documents from the estate administrator and, if the estate is still open, the amounts should have gone to the estate (if that was dictated by the terms of the plan document).  It is possible that the estate is closed and the estate docs designated the son to get half and the granddaughter to get half.  Before you go ahead and try to correct the distribution, I would first confirm who the correct beneficiaries are pursuant to the plan document and, if relevant, the estate documents.  
  17. Like
    Bri reacted to Paul I in Schedule MEP   
    The 2023 instructions to the Form 5500 page 3 includes the following definition:
    Pension Benefit Plan

    All pension benefit plans covered by ERISA must file an annual return/report except as provided in this section. The return/ report must be filed whether or not the plan is “tax-qualified,” benefits no longer accrue, contributions were not made this plan year, or contributions are no longer made. Pension benefit plans required to file include both defined benefit plans and defined contribution plans.
          The following are among the pension benefit plans for which a return/report must be filed.

          1. Profit-sharing plans, stock bonus plans, money purchase plans, 401(k) plans, etc. ...


    For purposes of the Form 5500, the term pension is used to distinguish a retirement plan from a welfare benefit plan.
  18. Like
    Bri reacted to Bill Presson in Affiliated Service Group; key and HCE employee determination   
    Plan participation doesn't impact that determination. 
  19. Like
    Bri reacted to CuseFan in In-plan Roth Conversion ... clarificatioin   
    If the plan document allows for such (or is amended for such).
  20. Like
    Bri reacted to CuseFan in Black out notice returned   
    I would save all documentation, and then do a typical missing participant search. The plan/plan sponsor/plan administrator hopefully has an administrative procedure for such and if not, now would also be a good time to develop one.
  21. Like
    Bri reacted to CuseFan in Basic Plan Document vs. Adoption Agreement?   
    Both the AA and the BPD comprise a plan sponsor's plan document. Therefore, to the extent a provision is delineated in the BPD without any corresponding AA selection, the BPD governs and should be followed. Not everything can/will/need to be outlined/selected in the AA and anything that is not expressly provided in the AA via a permissible selection is subject to any BPD mandates.
  22. Like
    Bri reacted to C. B. Zeller in ER makes a contribution for the Independent Contractor   
    Clearly the contribution can't be allocated to Mary since she isn't an employee. It would need to be treated as an employer contribution and should be allocated to the participants in the plan according to the plan's allocation formula.
  23. Like
    Bri reacted to RatherBeGolfing in self employed and deferrals   
    That begs the question, what does "completed" mean? 
    When it was prepared? 
    When it was sent to the client for review?
    When it was reviewed by the client?
    When the client communicates to CPA/preparer that they agree with the K-1?
    When the full return is accepted/signed by the client?
    When the return is filed with the IRS?
    The list goes on, which is probably why you have never had an auditor ask the question 
  24. Like
    Bri got a reaction from Bill Presson in Exclude from testing if Term <501 hours   
    Safe harbor and profit sharing are both nonelective contributions provided by the employer.  So they're tested together - you get one but not the other, you nevertheless benefited.  So the T<501 exclusion does not apply, basically because the person literally benefited.
  25. Like
    Bri got a reaction from Luke Bailey in Exclude from testing if Term <501 hours   
    Safe harbor and profit sharing are both nonelective contributions provided by the employer.  So they're tested together - you get one but not the other, you nevertheless benefited.  So the T<501 exclusion does not apply, basically because the person literally benefited.
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