Belgarath

Thanks to you both. Bill, because they don't want to amend the plan to allow this provision if they don't have to - their board is difficult on such issues. But I would do the amendment to cover this one participant, as Paul suggests. This plan needs to be squeaky clean, which is why I wanted to make sure I wasn't missing something else.

So, plan allows rollovers into the plan by participants only. Employee rolled money into the plan 2 weeks before entry date. Operational violation. I would almost swear I saw something that essentially said, "don't worry about it" but I can't find anything like that. Maybe it was just a pleasant daydream... This is an audited plan. If it weren't, I'd be very inclined to ignore it. Although I think it could be corrected via a retroactive corrective amendment, the plan sponsor obviously doesn't want to go that route. Am I missing an acceptable alternative to the two choices above?

No, I don't think so. If, for example, a participant got fired on Friday, participant would not satisfy the last day of the plan year requirement. It would be very unusual for a document to specify the last pay date in the plan year for allocation requirement, although it could - I've certainly never seen it.

Ambiguously written? Nah, couldn't be... Thanks all for the opinions. It's very reassuring to be able to see the informed discussion on such issues.

Section 101 modifies IRC 414 with the new 414A requirement. Specifically regarding paragraph(b)(3)(A)(ii), does the language require that the participant must make a new election each year, or if they make an election other than the auto enrollment percentage in 2025, does that election carry forward, if the plan so provides, until such time as the participants makes a new election? I believe it is the latter, but I'm not 100% certain.

Gracias. And Peter, this is for 2024, looking ahead.

So there is both k-1 income and W-2 income for the former partner. There seems to be some gray in this area. It seems clear that the compensation for the former partner is the sum of k-1 income and W-2 income. But, how is the K-1 income calculated? Do you just take the k-1, taking into account a PROPORTIONATE share of the common law employees' contribution (let's say 6 months for sake of illustration) or use some other method? Or to put it another way, it appears that another method might be acceptable, but maybe not...? Any opinions welcome! Thanks.

Did the IRS say what changes were made? The CP220 (at least as I understand it) is supposed to show what changes were made.

We don't really do anything with ESOP's, but I was just curious: if/when this applies to an ESOP, does the TPA have any obligation, or is this just a corporate/legal reporting issue that the TPA does not need to worry about?

I wouldn't touch this with a barge pole. Client needs ERISA counsel.

While I'd observe that I think you are oversimplifying the definition of Statutory Employee (see IRC 3121(d)(3)) I'd agree that if the employee is truly a Statutory Employee, (and not a full-time life insurance salesperson - see IRC 7701(a)(20)) they are independent contractors, and thus ineligible to participate in the plan - shouldn't need an additional special exclusion.

Very sketchy info at this point, but likely that at least some years will be a large plan. Sure, they can do DFVCP, but how far back do they go with this? And there will likely be no way to get full data for all the post-2009 plan audits. We'll see. No, this isn't April Fool - I wish it was! Heckuva way to start a Monday morning... Anyone had one of these situations before? What were the results? Thanks!

Agreed. Although... I suppose that depending upon employee population, might possibly be difficult to find a valid exclusion category that would apply only to this one person?

I agree with Ratherbereading - your question(s) are very unclear, and based on what you have said, you won't get a good answer from this board. I will say that believe you are possibly confused as to the details. I don't for one second believe you were charged $17,000 "interest" on a $6,000 plan loan that was taken in 2016. As RBR suggested, contact Brighthouse, or whoever is responsible for the plan/reporting, and ask for a detailed explanation.

Interesting - thanks. BTW, just curious - are you really getting a mad rush of potential clients who want to convert mid-year? We haven't seen it.

So, FWIW (nothing) here's my thought. Yes, the law says what the law says. But because that frequently isn't crystal clear in black and white, that's why we have regulations, Notices, Revenue Rulings, etc., and ultimately court cases. Seems to me like the Congressional intent was to require that the new plan be ESTABLISHED the day after. Just my opinion. But in the absence of some additional specific guidance, do you want to be the one out on the window ledge? I'm more cowardly by nature, and I wouldn't push the edge of the envelope. You may well be right. I just wouldn't adopt your opinion, at least at this time.

Well, this is for tax year ending on or after 12/31/2023. Agreed it is a PITA. But there's some time, although not that much, before they are actually due, and hopefully it isn't a high-volume item for your client base. Our thought, off the cuff at the moment, is to send them out, have client sign them and return to us, and by the time they are due, there will hopefully be providers that are ready. I feel pretty confident that there will be reputable organizations that will be ready in time. I might change my tune as we consider more fully.

Do you have a 5500 form filing software provider, such as FT William or whoever? If so, have you contacted them to see if they are approved, and if/how you can sign up for the "module" or whatever? I have not encountered this yet, so thank you for bringing it up! Update - I got a response already from FT William's wonderful support folks. They are actively working on this, and will be an authorized provider, but do not yet have a specific release date.

Sure. Your wife says much nicer things about you than mine does about me...

Still seems funny not having Tom remind us of this. Tom, if you are lurking out there, Happy Pi Day.

Question I'm not clearly understanding. I know that you cannot include LTPT in testing for some purposes, and not for others. Basically "all or nothing" - that is, 401(a)(4),ADP/ACP. 410(b), etc. What I'm not clear about is, for example, suppose the employer provides that LTPT who defer will also receive a match. Can the employer STILL exclude the LTPT employees, for all the above testing purposes, or must they all now be included for all of the testing? I think it is the former, although it seems counterintuitive, but I'm not certain. (P.S. - I base my theory that it is the former on the proposed Regs, and nearly at the end under Section f(3)(i) Example 1((a) and (B).)

Peter, this compliment is long overdue. You are without question one of the most objective and fair minded observers I've encountered, as well as being a great source of information. If you decide to run for higher office, I'll vote for you!

I'm re-upping this thread. The 8822-B instructions are still from 2019 on the IRS website. While the 2023 5500-SF instructions for line 2a, under the NOTES, still say to inform the IRS via 8822-B for an address change, the 8822-B instructions (2019) still say there is no penalty, and that for a change of address that use of this form is voluntary. Has anyone seen any new movement/information on this issue?

Agreed. As I said, we always specify it is their decision, with the advice of tax/legal counsel. We do provide "discussion points" to educate them and for them to discuss with their attorney, with references to Code/regs. It's just that they hardly ever do. I can probably count on my fingers and toes the number of times in the last 10 years or so that a client actually has done so.

Gotcha - I just couldn't, offhand, see why they would bother if they already passed, but this clears it up. It's been a long week, and my brain obviously needs recharging! Thanks.