Belgarath

Thank you both.

A colleague has been receiving different responses to the following. I don't pretend to know! Any thoughts? Thanks. Is it permissible to offer both an HSA and HRA to employees participating in an HSA eligible group health insurance plan? For example; is it okay to have an HSA cover the first $1,300/$2,600 in deductible expenses and then have an HRA pick up some or all of the remaining deductible and/or co-insurance expenses? Are there other options, say where the HRA pays the first $X in deductible expenses and the HSA could pick-up expenses after the HRA benefits have maxed out.

Ah, the "service spanning" rules. It sounds like your plan is using the "elapsed time" method of crediting service for eligibility purposes. In that case, it sounds like FT Williams is correct. You can double-check your document to make sure.

Interesting exercise, but to be honest, I would never dream of questioning or "calling out" the service of the daughters, based upon the statement by the CPA that they don't work there. I feel like that crosses a line (what line, I'm not sure) but I frankly don't think it is my business to question that. Now, if the CLIENT had told me the daughters don't actually work there, that's a different circumstance altogether. Then I'd just resign as TPA. Can't correct egregious fraud under VCP! P.S. - question for the CPA's out there- is the CPA violating any professional ethics by telling this to the TPA?

Ok, thanks for the info.

"Some (but a growing number - especially for California participants) name the service provider (not the plan - because except for a DRO, the plan can pretty much ignore the court under ERISA preemption) as parties to the divorce action and then are automatically enjoined from distributing participant balances pending further order of the court." Mojo - can you educate me a bit on this? What are the requirements for validly "naming" someone as a "party" to a divorce action? If the service provider has no discretionary authority, then would it have any actual effect regardless of whether they are named or not? If there is discretionary authority, then wouldn't the service provider be a fiduciary, which is generally what we seek to avoid at all costs! I'm not a lawyer, and I really have no idea what the intricacies are... Thanks.

But, this is really "hearsay." Just because the accountant said this doesn't mean it is true, and you have actual knowledge that fraud is being committed. I reiterate my opinion that it is not your problem. (I will also say that nearly every standard census gathering sheet that I've seen or the engagement letter, etc., would all say that you are relying on the accuracy of the information provided by the client)

Yes, it is tax fraud. I responded to this in your other post. But that's the client's problem, not the TPA's.

Well, that's tax fraud. But that's the client's problem, not the TPA's.

GASP! Not...need....to....see..."Retirement...Plans"... - the answers to the meaning of life, the universe, everything? It doesn't seem possible. IS there anything else? Such a heretical act of heinousness is unparalleled in modern history. Dave would get lonesome without us, and we can't have that.

Thanks. They did actually do a notification each year - just not a model notification. It was more of a paragraph on their annual benefits notifications/elections. This is according to the accountant - I have not seen any of this documentation, so my knowledge of the situation is based upon a phone call only. The submission is indeed using a shoehorn to fit it into the most reasonable "pigeonhole" in the SIMPLE submission documents, but I don't see where anything else really fits, either. I don't know what other "fix" could possibly be done, anyway - you have a plan with no document, you adopt a document! Of course, I can't guarantee the IRS will accept it without asking for the documentation you have mentioned - and of course there was no SPD (the modified "SPD" normally required for a SIMPLE) but you can't retroactively provide an SPD anyway. I doubt the IRS would disqualify the arrangement - I'd like to think not...

So, employer apparently operated a SIMPLE-IRA plan without ever completing and signing a document! Quite a trick. Anyway, when submitting for correction with a 14568, Schedule D, they ask for a copy of the current document. Since this isn't possible, obviously, I presume you would just include this in the narrative that there isn't an existing document. Anyone ever done one of these, and had the IRS request anything additional? Thanks,

FWIW, we have now received a DRAFT document from our provider. Major changes are not anticipated, but it ain't over 'till it's over. At this point, it retains the provision that for an ERISA plan, "once in always in" for purposes of the 20 hour exclusion.

FWIW - I would call this a fringe benefit. Unless it is through a cafeteria plan or something, then I believe the IRS would be consider it a taxable fringe benefit, but I haven't specifically reviewed whatever publication addresses fringe benefits. https://www.irs.gov/publications/p15b/ar02.html

To be more specific - a plan is not treated as failing the 401(a)(9) requirements solely because it fails to make an RMD during the period when the QDRO determination is being made, so long as the period does not extend beyond the IRC 414(p)(7) period. 1.401(a)(9)-8, Q&A-7.

Only one problem with that theory, Tom. The IRC was produced by Congress, and monkeys are WAAAAYYY smarter!

I haven't actually seen a situation where the IRS nailed someone for a "late" safe harbor notice, but then, we always get ours out on time - although I can't guarantee that the clients actually do the same! Has anyone seen, or do you know of, a "real life" situation where they stuck it to someone on this? I'd like to think they would be generally reasonable - particularly if the safe harbor is the 3% nonelective. Just curious...

Perhaps I'm misreading your question, but I'm confused. Since all was contributed in 2016, there shouldn't be any excise tax for 2015. (Now, they may have to re-file their 2015 tax return if they took a deduction for a contribution that wasn't made in time, but that's a separate issue.) They will presumably deduct it when they file their 2016 return.

FWIW - I checked with an ERISA attorney on this, who agreed with me.

"Solo-K" is purely a colloquial term, usually used for marketing purposes. But to answer your question, if only the sole owner has satisfied eligibility requirements, then it is a "one person" plan for purposes of the 5500 filing requirements.

I'm looking at an amendment to a 403(b) plan - not our document - and I'm finding the wording puzzling. Or maybe I'm just reading it wrong. It says: "Notwithstanding the provisions of this Section (I've deleted the section numbers to preserve some semblance of anonymity to the document provider)..., pursuant to the direction of the Employer, as Plan Administrator, if the value of the terminated Participant's accounts that is attributable to non-Roth contributions (including his Rollover Account, if any) is not greater than $5,000, the terminated Participant shall receive a distribution of the value of the entire vested portion of such Accounts attributable to non-Roth contributions and the non-vested portion shall be treated as a forfeiture." Now, what this is supposed to mean may not necessarily be what it says, or what I read it to say. But to me, it seems to be saying that you are completely excluding Roth accounts when determining the $5,000 threshold. I don't think this is correct or allowable under 411(a)(11). For example, if you have $4,000 pre-tax and $4,000 Roth, you can't force out the $4,000 pre-tax. (and what good would that do anyway???) I wonder if perhaps, instead, this is really meant to encompass the guidance in 401(a)(31)(B), and 1.401(k)-1(f)(4)(ii) where the $1,000 threshold is applied separately to Roth and non-Roth? Maybe I'm just tired, but this one has me scratching my head. Thoughts? Thanks!

I believe you can do this using the Relius webinars through a "Qualified In-House Training Program." You would be the "Registrar" and would have some sort of an attendance form, listing the seminar, date, number of minutes, etc, where you certify that "Whoever" was in attendance for the duration of the time indicated. They would keep this form, and self-report the credits. I don't know if you have to actually "register" such a program with Relius or not - you should probably contact them. Sorry - they are FIS now.

I agree, but I'd note that the "definitions" are in fact frequently turning on "facts and circumstances" and it can sometimes be a difficult call - as evidenced by substantial litigation in this arena. Certainly I agree that someone other than the TPA should be making this determination!!

Very clever! Your heart may be three sizes too small, but the brain is full sized. (I carefully did not say the brain is "normal")

I happened to find the following item that I posted in a "Humor" conversation back in 2014. How could I have foreseen the horror that awaited (actually, since the Red Sox choked in the playoffs this year, I'm glad the long-suffering Cubbies won). But just wait 'till next year!!! "What's a Cubs fan? I thought the last big asteroid strike made them extinct."