Belgarath

When using pre-approved plans, which these days are most of our plans, we do not generally submit for a d-letter. We give the client the choice, and as you mentioned, the fee (plus our fee to prepare the filing) is a deterrent and virtually none of them elect to file. We have the odd DB plan (are all DB's odd?) that files, but very few plans file. And what ETA and RBG said.

No. It is not a BRF. Not an optional form of benefit, not an ancillary benefit, not a right or feature.

Tom, I hung several of your Grinch relatives on the tree last night. MY relatives also hang from trees, but they are hanging by one arm, while eating bananas with the other... FWIW - We've always taken the IRS approach for exactly the reasons specified.

When was the plan actually amended for this change? Depending on the date, Tom's comment might be applicable or might not. For example, if this change was actually made prior to 2015, then it wouldn't apply. If amended in 2017, then he's made a great point on a tricky little "gotcha" that you need to be aware of.

P.S. - from the DRAFT 2017 1040 instructions: Enter on line 16a the distribution from Form 1099-R, box 1. From this amount, subtract any contributions (usually shown in box 5) that were taxable to you when made. From that result, subtract the amount of the rollover. Enter the remaining amount on line 16b. If the remaining amount is zero and you have no other distribution to report on line 16b, enter -0- on line 16b. Also, enter "Rollover" next to line 16b.

Methinks it is just that easy. The amount from the 1099 is entered on 16a. Then 16b is zero. I haven't looked at a 2017 1040, but on the 2016, you were supposed to write "rollover" next to line 16b.

Agree with QDROphile. I suppose you could give him 1.401(k)-1(f)(3) as a citation - at least it does discuss the fact that gains, losses, etc. must be separately allocated to the Roth account on a reasonable and consistent basis. If physically separate accounts were required, such language would be unnecessary. But if he hasn't understood this already, you will probably be beating a dead horse anyway.

Yes.

Check your current document. A 401(k) arrangement is an additional FEATURE added to a profit sharing plan, even though commonly referred to as a "401(k) plan." Most 401(k) plans PERMIT a profit sharing contribution already, even if they do not utilize it. If they want to establish a new Profit Sharing plan on top of their existing PS/401(k) plan, yes, they can do that, and they could exclude service, for vesting purposes, prior to the effective date of the plan. I don't know the situation - with modern relatively short vesting schedules, unless they have a lot of employees, a lot of turnover, and substantial contribution levels, it is hard to see how the added expense of maintaining another plan is justified - but perhaps it is. Others here may offer some better insights.

So, employer has group health plan. Employee terminates in 2017, elects COBRA coverage. So far, so good. Suppose the employer modifies the health coverage effective 1/1/2018, increasing deductibles, out of pocket expenses, etc., for everyone. To somewhat mitigate these effects, the employer institutes an HRA. Is the employer required to offer COBRA coverage on the HRA to this participant for the remainder of the COBRA period established as of the original date of termination of employment? I don't work with COBRA, but I wasn't able to find a definitive answer in a reasonable amount of time, and wondered if others had dealt with this issue. Thanks! P.S. - FWIW, as I looked at some of the regulations, it seemed to me that under a "common sense" approach and looking at 54.4980B-3, it seems like since the "similarly situated" employees receive the HRA coverage, the COBRA participants with the same health coverage should also be able to be covered under the HRA... P.P.S. - while looking at it a bit more, perhaps a more appropriate reference might be 54.4980B-5, Q-4(c). Anyway, it does seem to point in the direction of, in this type of circumstance, requiring a COBRA election for the HRA to made available to the former employee - in this circumstance, all employees were allowed to choose among several health plan options, and the HRA was offered in conjunction with these health plan changes.

Thank you. The fog has cleared, and the cramp has disappeared. Help yourself to some Who Hash and some rare Who Roast Beast, and put it on my tab.

Having a brain cramp. Plan is rate group testing on an allocations basis. 2 HC's - wife makes all the money, and wants to max out. (cross testing doesn't work, 'cause owners are way younger than all the employees - only 4 employees anyway...) The husband takes a nominal salary, defers the max, but is excluded from all other employer contributions. When performing the Average Benefits Percentage Test, do his deferrals get added back in? Common sense says no, but as I said, brain cramp. Thanks.

Yes, but you have the strength of 10 Grinches, plus 2.

Thanks Tom. And after we had already sent the letter to all our clients updating the 2018 limits. Sigh...

Just confirming something: You DO need a PTIN for a 5330 or 945 if you are being paid (directly, or indirectly as part of a general administrative fee) but you DON'T need one for a 2848 if you are an ERPA, right? This question seems to pop up now and then. Thanks.

I see the Grinch has returned! Thanks Tom - that is sort of what I was thinking. Have you ever seen or heard of this being raised by the IRS in a real-life situation? I never have, although I'm not certain how often it would really be a serious problem anyway.

The regulations give mathematical certainty as to what constitutes an acceptable "range." However, there is that annoying caveat that says as long as the allocation/accrual rates of the HCE's within the range cannot generally be significantly higher than the allocation/accrual rates of the NHCE's within the range. I've always found this troubling. What is "significantly higher" (especially since the range is limited anyway) - is there any guidance on this? Thanks. Editing typo...

Social (in)Security? My assumptions are that I'll get just enough to live in a yurt and eat pine needles. Maybe once in a while my kids will drop off their compost so I can make a salad or a soup out of it. But remember, Washington is going to give tax cuts to us "hard working Americans" so we'll be rolling in money shortly...

Correct.

What Mike said.

You have the basic idea, but as ESOP notes, it is the details where you need to be careful, and which makes it impossible for us here to answer your question as a yes or no. Many people misunderstand the 20% - the 20% is not the TAX, per se, but is simply WITHHOLDING. So when you ultimately file your tax return, this 20% withholding will either mean you get a bigger refund, or owe less. The 20% withholding doesn't exist in a vacuum.

True...

Is it really a related group problem? There's no cross-ownership whatsoever (or won't be) - right? Doesn't sound like it would be a management function ASG either.

As I read Mike's post, I don't think that is what he said.

FWIW, experienced ERISA and ESOP specialist legal counsel is involved, and apparently has no problem with it. Counsel also said that they would NOT be allocating gain in the ESOP plan, (if any) to the selling shareholders upon the subsequent sale of the shares that the ESOP obtains from the selling shareholders.