pmacduff

Hi Dave - I like the fact that I can get different views/takes on situations (including situations I may not have experienced yet) and, as others have mentioned, that you can be brought to clarity on issues where you may not have been seeing the big picture.  Been doing pension administration for a long time and appreciate that interaction between posters, moderators, etc.   Lighthearted moments help too every now and again although it has been hard without Mr. Poje !
 
 

Hi Dave - I like the fact that I can get different views/takes on situations (including situations I may not have experienced yet) and, as others have mentioned, that you can be brought to clarity on issues where you may not have been seeing the big picture.  Been doing pension administration for a long time and appreciate that interaction between posters, moderators, etc.   Lighthearted moments help too every now and again although it has been hard without Mr. Poje !
 
 

my 2 cents - agree with Lou S and wouldn't you have the same scenario if a plan switched from an accrued to a cash basis?  I realize that would only be for the one year, but it sounds like that's what you have here as well.

my belief is that the intention of the form 8955-SSA was so that participants who had not taken distribution of their plan account (for whatever reason) are notified of said account when they reach retirement age and apply for their Social Security Benefit.  I've read many of the letters these participants receive from the Social Security Adminirtration when they apply for SS and it is indicated that they "MAY" have a benefit in said Plan.
That being said, I suppose the semantics of a participant having a "deferred vested benefit" could lend itself to mean that either they couldn't yet take the benefit when they left (if only payable at NRA) or that they actively deferred their benefit until a later date and not that it was available to them earlier and they just didn't take it.
However in practice I was always taught and assumed as Jakyasar says that you report anyone entitled to a benefit that has not yet taken that benefit (within the form parameters).
 
 

what about cold hard cash 😁?
Sorry SSRS - hopefully you don't mind the humor - I think we all need it - but seriously very nice post and sentiment about the help you received!

Hmmm...I was channeling Tom Poje (as opposed to Derrin) when I read through it
Nevertheless - fun again to have something bring a smile this time of year, thank you Belgarath!!!
 

Any chance it could be classifed a COVID withdrawal?  It sounds as thought that might have been the thought process if it was for $100k.
I don't recall if those had any source restrictions though.

I was thinking more of what the OP said about checking the 5558 box on the return when filed:
"...get"into gear" and file Form 5500-SF today and check off the box for Form 5558. "

Any chance it could be classifed a COVID withdrawal?  It sounds as thought that might have been the thought process if it was for $100k.
I don't recall if those had any source restrictions though.

Isn't it also true that if the 5558 wasn't filed timely it's a moot point anyway because the IRS will go back to the original filing deadline to access late filing penalties?

Not to worry - thank you for checking and I feel better now about my "reputation" 😁

Thank you Lois!  I'm not able to click on the number (perhaps my browser or browser settings?).  If I put my cusor over the number it only says "member's total reputation".

Hey Dave - sorry if this has been dicussed before but I'm just noticing...what is the "member reputation" figure that appears by our names with a plus sign and a blue number?  Not that I'm vain mind you, but mine is rather low and I wasn't sure what is driving it 🙂

Hello all and thank you for the responses.  I found the attached on the IRS website, which explains it well and supports our situation perfectly.
415 limit example.docx

Hello all and thank you for the responses.  I found the attached on the IRS website, which explains it well and supports our situation perfectly.
415 limit example.docx

Its semantics but it appears based on the information you provided that this is a "transfer" within the plan assets and not a "distribution" of plan assets.  Therefore no 1099-R should have been generated. 
That being said, I had a client some years ago with a similar situation and the 1099-R reflected the name of the Plan.  The broker and client tried to get the investment firm to fix it but they refused.  There was never any fallout or followup by the IRS in our case.    
 

Its semantics but it appears based on the information you provided that this is a "transfer" within the plan assets and not a "distribution" of plan assets.  Therefore no 1099-R should have been generated. 
That being said, I had a client some years ago with a similar situation and the 1099-R reflected the name of the Plan.  The broker and client tried to get the investment firm to fix it but they refused.  There was never any fallout or followup by the IRS in our case.    
 

Hello Stash - Yes - beneficiary ssn and name and you can use both a 4 and a G in Box 7 on the 1099-R forms. 
The 1099-R instructions (attached pages 15-17 and available on the irs.gov website) have a list including all of the codes and those that can be used together, which I have found an invaluable resource! 
["fyi" I do realize that these instructions are for 2021 1099-R forms, however there aren't any 2020 1099-R instructions posted on the irs website]
i1099r_2021.pdf

The SH match is an Employer contribution and therefore due to the Trust by the time the Employer files it's tax return (plus extensions). 
In other words, the true up contribution must be in by the Employer's tax filing deadline unless it extends, then it would be the extended date.
Does this help?

We used FDP back in the day.  It was morphed over to Relius (actually Quantech first but that's another story).  Anyway - I'm not sure I am chuckling, it's more scary I think.  Why on earth is someone running a val on FDP and the DOS version no less?  Not to mention the myriad of changes that have happened in the Regs since then.....

At least people don't say "Oh - you're in insurance?" like they used to back in the day when I started in retirement plans and said I worked for a TPA ?!
 

The Plan could use code 2, which eliminates the 10% premature penalty however if not 100% sure of disability status then the Plan should use code 1.  If truly disabled, the participant then addresses that on his/her personal tax return with form 5329.  My husband is totally disabled and one of his IRA withdrawals last year was coded with a "1" in error.  Rather than go through the hassle of having the 1099-R reissued, I simply filed the 5329 form with our personal return and we did not have to pay the 10% excise tax.
 

This seems to be coming up more and more in my world, more with regard to the Federal withholding.  Is it true to say that the former Employer Plan, if it does NOT offer COVID distributions, would treat this like any other terminated participant distribution (i.e. 20% Federal withholding if not rolled over)?  Then the participant will handle the taxation part on their end when they file their personal return for 2020?  
- Or - is the former Employer supposed to process this as a COVID based on the former participant's presentation that it is a COVID distribution even though there is no intention to add the COVID provisions to the "old" Plan?
Some of our clients are getting pushback from former participants that no taxes need be withheld as a COVID distribution (they claim to be furloughed now due to COVID at their current employer). Our client's plan did not adopt for COVID withdrawals because they are an essential Employer and not currently needing to add the provisions.

FWIW - our State actually has a method online whereby  you could submit for a determination/designation of whether or not your particular business was essential (on the State website).  Another local TPA did submit a request for determination, which they shared with us.  In the response (which came rather quickly I might add) they were advised that they were considered essential based on the information provided in the application.  There were some caveats that" only those employees necessary to perform the essential functions should be permitted to be present and provided they follow all other guidelines of the Executive Order".     
 

I was in a webinar yesterday with Derrin Watson and Stephen Forbes - during the Q&A this came up.  It was recommended to use a Code "1" if the taxpayer is under 59 1/2 and then the taxpayer would address this when the individual's taxes are filed.  I believe there was a form mentioned that allows the taxpayer, when filing, r to advise the IRS that there was an exception. 
That being said, I agree that when the time arrives next January, there will be a "special" code that will be used however in this case Susan was needing a code right away.
My two cents...