pmacduff

The 1099-R from the plan reports this type of transaction (401(k) to roth IRA) with an IRS Code "G" for rollover and then the taxable amount is included in Box 2. [Whereas on a plan to traditional IRA rollover box 2 taxable amount is 0.00. Wonder how many of those 1099-R forms have been or will be done correctly or incorrectly!!!] I'm not sure about the 5498.

ok - we're all on the same thought pattern here... we also just had this discussion in our office, but it was regarding a John Hancock plan which of course has both the Schedule A and Schedule D. Would you still agree that a 5500-SF can be used or should it be the 5500? I noted that when I did my carry forward if I change the form type from 5500 to 5500-SF then I have to go in and delete the Sch A & D (and any others not applicable for SF) before I can even open/access the 5500-SF form. This should be fun............

Tom...sung to the tune of "If I were a rich man..."????? ("If I were an HCE....") keep smilin'!!!

I guess I'm still trying to understand why anyone would care that the HCEs are getting a lesser match rate (if the plan forfeited the match as opposed to distributing to the HCE). I thought it was pretty much ok to discriminate against the HCEs!! In the small plans forfeited match could benefit the business owner anyway, because it reduces the current match owed and lowers the amount of cash needed to fund current $$! Sigh...

so...that could explain why the acp correction is returned to the participant and not forfeited? we don't have any plans left with employee after tax dollars - this is just Employer match $$.

Tom - do you know why the acp match correction is not forfeitable? I know this is a basic prinicipal of testing and goes way back, just don't follow the logic so please humor me. I guess I'm also not use to having just the acp fail, usually it's just the adp.

ok - this has come up a lot lately in plans we have recently taken over and I'm starting to doubt my own memory! For a failing ACP test our plans all forfeit the match to the match forf. acct and it is then used to reduce future matching contributions. I have a takeover plan, however, where the ACP failure matching contribution was paid out to the participant (and has been for quite some time throughout past years). (Let's assume for argument sake that the ADP test passes.) Is this acceptable? How can this be paid out to the participant? Why would the participant receive a 1099-R form for Employer match and pay tax on something that was not part of their payroll? I'm trying to get my arms around the logic of this procedure that was in place. thanks in advance...

Bill - Not sure what you mean by "the increased notifications on the status and continuing work to get things resolved" ?? I had to submit an incident on January 14th in order to find out the status of the release containing the 1096 and 945 forms. We received nothing prior that there was a delay of any kind. I then received a response that a Friday (01/15) release was anticipated but testing was not complete and it would more likely be into the following week. I checked online on that Monday to see the release date listed as 01/19 (Monday was a Holiday). I believe the forms were finally posted on 01/21. Sorry - just had to vent again here as I found this whole situation very trying this year..... TGIF

Yeah Bird, we were able to get all of ours out. I had to do some overriding on the 945s in the software because we didn't have service pack 4 yet but all of our clients pay the taxes in as they go (i.e. $0 balance due with the form) and many are under the $2500 threshold for the monthly breakdowns. I have been thinking about next year and what we may do as far as changing vendors. I don't need more stress in busy season; trying to get those forms out timely to the client with such a late delay in the release of the forms. I'm done venting for now

Anyone else frustrated with the fact that the 1096 and 945 forms on Relius Gov. forms have still not been released? We send everything out to our clients and while I can put off the 1096 and 1099-R Copy A filing forms alittle bit, the 945 is due to be filed by Jan. 31st. Not to mention the fact that I don't want to have to send our clients 2 different mailings on this stuff; one is complicated enough for some. We're thinking of looking for a new 1099-R forms vendor. Others?

While it is definately highly recommended; strongly advisable, in the best interest of the Plan and Sponsor, etc. it is NOT required to have a separate Trust ID (EIN) for the Plan. We have a few "old" profit sharing plans (very few!) that still use the Sponsor EIN on the 1099-R forms. They have very little turnover (translate to very few payouts) and it has worked fine for them. So while I agree that there should be a Trust ID; if the plan has already made payouts and it is simply a matter of getting the 1099-R forms filed, the Corporate EIN can be used for now (and should be used if any tax withholding was submitted under that number). If there are more payouts to be made, a new Trust ID could be applied for as necessary (again, highly recommended but not required).

Boy Kate, I haven't heard either, but that would be great for me as I just found out today that the software vendor we use is "hoping" to have the 1096 forms ready by the middle of this month! We send out a LOT of 1099-R forms. We have those all loaded up, but the 1096 isn't yet available. We send the whole package to the Employer for review and then they mail out the participant copies (of course due by 01/31) and then sign and mail the Employer filing by 02/28. If I can't have the 1096 forms in time for a timely mailing from me to the Sponsor (for them to mail the employee copies timely); I'm afraid I'm going to have to do 2 separate mailings this year...YUK! (not to mention the added expense of 2 mailings) We are in the small plan market, but I have a bunch of Employers with 40 - 50 forms.......

Cute bird!! The way I remember is that any "non-elective" can count toward the minimum, match is considered "elective" as it is based on amounts deferred.

I would also note that if each owner as "always benefited from the maximum annual contribution" as noted in the original post, then I think this plan was already likely being checked for 401(a)4 nondiscrimination, or should have been.... Just because they were previously at the maximum compensation limit, doesn't mean the annual additions weren't weighted toward them. my 2 cents.

K2retire - I just looked in Publication 590 - (see page 26), it looks like you can roll those monies now. I know what you mean, though, my Mother retired about 7 years ago and the after tax amounts in her 401(k) Plan were distributed to her. She rolled everything else over. She didn't have an option at the time, either but had to take the after tax $$.

All of our vendors allow roth contributions to roll to roth IRA and pre-tax to roll to traditional IRA, in fact that is actually the norm for most participants I see. I don't know about the options for any other "after-tax" dollars in a Qualified Plan as none of our plans allow the after-tax contributions (besides roth). I'm told that was allowable in the "old days" but eliminated from many plans as the after tax dollars had to be tested in the acp testing. others?

AMEN!

Those are the forms we are submitting prior to 12/31/2009 so that we don't have to use the EFAST2 electronic. Most of my short year filings are for terminated plans and while I may know where the Sponsor/Trustee is right now, if I waited until later in 2010 and also had to have them setup for EFAST2 and electronic filing, it would be a nightmare. Take a LOT of my time and the Sponsor, too...I think we know who would get the short end of that!

Tom - that's it - we were all talking about paper vs. the new required EFAST2...

I'm with Bird. Tried to get an answer out of anyone at the ASPPA conference this year (IRS, DOL, etc.), but no one would commit. I was in a session, however, where it was stated that any paper filing that was in before 12/31/2009 would be accepted and there was a DOL rep as a speaker for that same session. I have rushed to get all my short plan year & termed plan returns in before this year end regardless of due date!!

We have a MEP with 60 - 70 employers...since each Employer Plan is viewed almost as a "micro plan within the plan", we would count the person separately under each Employer as applicable. The participant reflects a balance separately under each Employer in the pension software, another reason we count them separately. I don't have any cites for you, but I can tell you that this particular MEP has had 2 different IRS random audits and passed both with flying colors!

Thanks gentleman...everything is working...all is status quo again! Happy Holidays & Merry Christmas!! On to your baking Mr. Grinch...

(4) - Well - we certainly don't "make big money off this scam"! We also try to do what is best for our clients AND their employees. As I previously mentioned - we work with the smaller employers who would not have a plan AT ALL were it not for the benefits of cross-testing. So your "securing benefits for the greatest number" statement applies to our clients because those smaller employers with anywhere from 3 or 4 up to 50 to 200 employees/participants do provide for a large number of covered employees - in our market anyway.

You are right, somehow the files were not in my Custom folder. When I remove the page number and have to resave under a different name, does that do anything to the process?

I don't want any page numbers at all. (Each of our client reports vary and most can be printed directly from Relius without page numbers, so I can basically put the report in any order I want. The only thing I had changed on the old version was eliminating the page numbers. But since the last update I did, I'm doing a report and see that the page numbers are there again. It might be something else I did (!), I just assumed it was the update.....