Belgarath

Yeah, I've never EVER even SEEN a SAR distribution date even questioned. Doubtless I just jinxed myself...

I have come to really dislike RMD questions. However, here goes: Participant dies in 2023. Already taking RMD's. Spouse, who also works at the same company and is a participant, took his RMD in 2023, and then "moved" the balance of his account to her account in the plan. She is younger - late 60's. As I understand it, she can treat this money as her own, and no further RMD's are required until HER RBD. Have I got that right?

It seems to me that a governmental entity can't be part of a controlled group? I haven't actually done any research on the question - just my assumption...

YES, YES, YES!!!

You are correct, and you aren't overthinking it IMHO. But it has always been this way, just utilizing younger RMD ages prior to these new age changes. The "two in one year" issue is one that many people have avoided (and can avoid) by not postponing the first RMD.

Hi Peter - hard to say - I never see the plans where everything goes well - questions only come to me when there's a problem, so sometimes my perceptions are a bit skewed. If I had to guess, I'd agree with Bri most of the time - maybe 80% we find it, 20% they find it internally. And the ones who discover it internally are usually the ones who have been through it and received our assistance with appropriate correction before!

Leaving aside the investment advisor, most of our small plans have either one or two Trustees. Just at a ballpark estimate, I'd say about 20% have only one Trustee, the other 80% have two or more. And no, for the 1-Trustee plans, I'd say there is no other fiduciary who would call attention to a breach.

Pay particular attention to CB's comments here, especially the allocation of forfeitures part. I've seen plans where plan sponsors got badly burned on this.

With the giant caveat that I am neither an attorney nor an IRA expert (I'm a TPA)...you need to check under Florida law. Most (all?) states have some form of "Simultaneous Death" statute, where if both spouses die within a certain amount of time, the spousal beneficiary is treated as not surviving, so it passes to the contingent beneficiaries if named, and to the estate if no named contingent beneficiaries. Other people on this board are certainly far more expert in these matters, and will probably give you much better answers!

You might also find this helpful. https://www.irs.gov/retirement-plans/401k-plans-deferrals-and-matching-when-compensation-exceeds-the-annual-limit

Deleted post - information originally provided to me is incorrect.

Thanks - that was what my gut was telling me also, but SECURE/2.0 sometimes causes digestive ailments...

So, suppose you have a plan that doesn't qualify for any of the exceptions, so the SECURE auto-enrollment provisions apply. Plan is an ACA, but not an EACA, so will have to be amended to be an EACA, SECURE provisions, etc., etc. If the participant already has an election in place, can this be "carried over" under the updated SECURE plan provisions? Would your answer change if the election in place is LESS THAN the minimum 3%?

Not sure I agree. that Revenue Ruling really was, IMHO, specific to tax returns, which of course a plan restatement is not. I think that technically, it is late. Now, I have found that the IRS is generally pretty reasonable about things, and in this situation, it would take a pretty harda** reviewer to stick it to your client. But is it worth the risk? Others may have different opinions.

I agree with the above comments. It WAS permissible under some documents back in the Jurassic era or something like that, using a "waiver of allocation" but the IRS did nix this a long time ago - I really can't remember what regulation or guidance took that option away. I do recall that when it was eliminated for everyone else, one company that I know of got a reviewer and approval letter where it was allowed. Annoyed the heck out of the rest of us...

Does anyone know of a good summary of what specific MANDATORY SECURE/2.0 provisions specifically do apply to a Governmental 501(c)(3) non-ERISA 403(b Plan? A small list, I know, but it would be handy to have. Thanks.

It's way over $1,000. Your solution is probably better and safer.

Hard to believe, but there's a similar situation that has cropped up in a different plan, except that the plan in question does not allow rollovers into the plan from terminated participants, yet they allowed one to slip through. They DO NOT want to amend the plan to allow it. They want to force this money out of the plan. I'd say that they could do this as a self-correction, after first allowing the participant the option to do a rollover from this plan to an IRA, another plan, etc. Agree/disagree? And then if the participant doesn't do a rollover, then it would be reported as a taxable distribution and subject to 20% withholding, etc.? Any other opinions?

That's an interesting point.

One item that occurs is that the in-plan Roth rollover would normally require a distribution fee to be charged to the participant's account. That said, I'm not sure most employers will be willing to go through the hassle with payroll/payroll providers, reporting, etc. Our clients already have enough trouble just properly allocating pre-tax and Roth deferrals to the correct account - I can only imagine the screw-ups if they attempted employer contributions as Roth. I'm not a fan of the concept.

Just bumping this up - now that we've all been filing forms for 2023, any thoughts now?

All great advice. I'll also mention ERISApedia. A great resource, with some outstanding bells and whistles available. Furthermore, the knowledge and generosity of their time and expertise among the many participants on this board has helped me immeasurably over the years. While I'm at it, yet another thanks to Dave and Lois Baker for doing such a great job in providing this forum!

Probably not a CG. But remember, even though there is no family attribution from siblings, there could be, for example, certain options to purchase some or all of the other 21%, that would count as "ownership" for these purposes. Most CG determinations frankly don't seem to take into account such intricacies, which is why we always advise clients to seek legal/tax counsel before making the determination. Or at least do a deeper dive into the rules. P.S. I just read another post of yours where Cuse makes the exact same point with regard to options.

Thank you!

So if an employer with a 401(k) or 403(b) signs on with a PEP mid-year, I assume when the employer's plan is merged into the PEP, there is no required nondiscrimination testing for the period prior to the merger - in other words, the coverage/nondiscrimination testing is performed for for the entire year, and would be done by the PEP provider?