RestAssured

I'm seeing conflicting info - and I'm sure I'm overwhelmed and confused. If we have a pooled-account plan (NO participant direction of investments), do we or don't we have to furnish a LIS? I've seen both answers "yes" and "no". THANKS!

UPDATED 590-B https://www.irs.gov/pub/irs-pdf/p590b.pdf Hope this helps.

Thank you BOTH for your input. I really appreciate the thought given.

😕 Thanks. Good thing it's a rarity for me...

Thank you Bird. I know that we cannot do 100% withholding, although I am old enough in this business to remember when that was an option because it was discussed at several conferences I attended. Anyway, I appreciate your answer. I have only had 1 participant call to say they had received a letter, but she had been paid out and a "D" had not been reported on the SSA. That was a million years ago. I haven't used the SSA form in many many years. IF a plan terminates with non-responsive participants, their money gets moved to PenChecks. Easy peasy. But again, my practice only handles very small employers' retirement plans. Thanks!

As you are aware, many moons ago, we / I would file an 8955-SSA to show participants with balances in a retirement plan. These were typically un-locatable or non-responsive participants, and filing this form was "THE" alternative to a 100% withholding to the IRS. (They frowned upon 100% w/h, didn't they?!?) A) does anyone file an 8955-SSA anymore? I only have small clients (<20 participants each), so this need does not arise often if ever. B) is there a way to see what has been reported for a specific EIN? I just found the 2017 8955-SSA of a takeover client in the previous TPA's records. I don't know what, if anything, was filed prior to 2017. Thanks! BTW - I did a search for "SSA" prior to posting this, but "0" topics were found. Sorry if this topic is redundant.

Thank you, I knew it was a long shot.

I am a TPA with a small employer (5 participants), and they would like to remove the Roth as an option. There is currently 1 participant making Roth deferrals. I understand that we can remove the Roth provision, but is there a way to 'grandfather' in the 1 participant who utilizes it so she can keep making Roth deferrals? I think I know my answer, but want to check with you guys. BTW (the story behind the question) - there has been a lot of hassle in cashing out a participant who had a total of $1300 in the plan, some of which was Roth. It has been a pain in the rear-end explaining all the nuances to the accountants (ha!) and investment advisor, as you all know, and even harder on the plan sponsor, so she has asked if we can just discontinue the Roth. The one lady who is still employed there and makes Roth def's may not be pleased if we remove it so we're trying to allow only her to do it. Thank you!

Thank you both. I agree. Was just hoping there was an out since it was MY mistake, not the client's. This has never happened before to me, I will say 😂

I, the client's TPA, did not file the 5500 that was due Jan 15, 2021 for the 2019 plan year. The deadline was extended b/c of Hurricane Sally, therefore it was due on Jan 15, 2021. I am willing to pay the $750 DFVC fee myself, but am coming here in hopes that someone knows of a way I can plead my case. The client has NOT received notification from IRS or DOL; I discovered my error when I was filing his 2020 5500. I don't know why I didn't file his 2019, it looks like I began the process. Who knows what happened back in Jan 2021. Any ideas? Thanks so much!

I have a very small TPA firm, and I do not sell any investments at all. Something you may consider is partnering with one of your client's TPAs whom you already have a relationship with, as Retired mentioned in his #1. I am the "back office" for an accounting firm. The way it works is - the CPA maintains the relationship with the clients, and I do all the firms' TPA work. I bill the CPA firm, not the client. (They are able to bill their client whatever they choose.) I discount my regular fees to the CPA firm because of the volume of business AND the fact that I have no contact with the clients. We all win! I have this block of business, and the CPA firm is able to offer this awesome service to their clietns without having to either add an employee and/or educate that employee. As was mentioned before, this is not an easy skillset to take on. I only give this as food for thought. I, for one, would love the opportunity to be the "back office" for a firm such as yours. Maybe one of the TPAs you already work with would too! Good luck.

I'm sort of having a brain fart.... I have a PS 401(k) plan that was adopted in Sept 2020, effective 1-1-20 for PS portion. There was an employee who terminated in August (ie, prior to adoption of plan). She had over 10 YOS, so she would be in the plan and receive PS, correct? (They are doing New Comp, so she has to receive something in order to pass testing). I think the answer is that she IS in the plan. Thanks for indulging my loss of brain function today.

Yes, I agree! The first one I opened/received, I had a moment of panic. Then I saw the Notice date and said "ah, our IRS is so 'on it'". And this is such a slooow time of year for us 🤪 , we have so much time to be explaining the IRS's slackness to our clients. ha ha

I found this website, and I have to say, it's dumbed down just enough for me http://blog.acgworldwide.com/ebars-the-first-step-in-cross-testing

I have been a TPA for very small clients for many years. I took a *wonderful* class taught by Norm Levinrad at NIPA a couple years ago, and I STILL refer to my copious notes. I have relied on my software (Datair) to calculate everything for me, and I have more than a general idea of how New Comp works. HOWEVER, I want to fully understand New Comp. I have a couple plans that I spend hours on each year, moving peas (ee's) under nutshells (alloc groups) to pass the tests. But if I fully understood this stuff, I'd feel so much better. Is there a webinar, a class, a tutorial, a book - that would explain the basics of New Comp?? A "New Comp for Dummies", if you will. I feel like a dummy. I'm willing to pay for this "class" (within reason). I want to know things like: (1) WHY does a participant who worked 150 hours have to get an allocation? (2) WHY does the allocation have to go on full year comp, when a participant entered on July 1? (3) How do I calculate (by hand) EBARs? etc etc etc Norm's classes were great, believe me, but it was like drinking from a fire hose and I'm still soaked! Thanks for anyone taking their time to point me in a good direction. (Maybe there are others who feel the same way? Maybe we could do a zoom class???)

Am I reading this right - that if we suspend/cease a SH Match, the 30-day notice to ee's IS still required, and we still have to pass ADP for the year? And if we suspend/cease SH 3%, a 30-day notice to ee's is NOT required but we still have to pass ADP? Thanks.

If someone under the age of 59.5 wishes to take a withdrawal based on the CARES Act, are they still restricted on money type(s)? In other words, can they withdraw their Safe Harbor money? I haven't had anyone ask for a withdrawal until now, surprisingly. And I have searched for an answer, and can't find it. I swear I've read this somewhere, so forgive me if it's been answered. Thanks!

Don't forget the April 1st RMD due date for some....

You're right, I was misunderstanding what you were saying. Now I get it. The withdrawals were simply "in service distributions" versus RMDs. (In Svc W/D are allowed, thankfully). This is based on the plan provisions related to RMDs. I will double check that. Can't a plan allow RMDs for anyone over 70.5, and also require them to anyone over 70.5 who is at least 5% owner? (Off to check my Adoption Agreement) Interesting discussion. It's remarkable how many RMDs have popped up for me in just the past few months. Thanks for helping me. EDITING TO ADD: Once an RMD starts (say, because participant was 25% owner and turned 70.5), but ownership changes (he becomes 1% owner at age 75), RMDs must continue. I have learned this through all of my research.

Thanks to you both. In the 2nd question: it was a woman whose personal accountant had her start RMDs a couple of years before I became their TPA. There was no reason other than that she was more than 70.5. I'll just keep sending them out! And I have a company whose owner is the wife, and the husband works there but doesn't have ownership. He's over 70.5 so I'll start his RMD too! Thanks.

1) Does family attribution apply with RMDs? In other words, a 70.5 year old man is an employee of his wife's company. Is he considered "more than 5% owner" for RMD rules? 2) If someone starts taking RMDs, and later discovers she doesn't have to (never should have started), does she have to keep taking RMDs each year? Thanks all.

1 plan with 2 sponsors (husband and wife owned 2 related companies, and adopted one plan for all ee's). Wife sold her company, so I removed her company as one of the sponsors, and all of her ee's rolled or cashed out. Except 1. (There's ALWAYS that one!) All of husband's company's ee's/part's were unaffected. This 1 participant (ee of wife's now-sold company) has over $1000 so we can't force her out on that grounds. The plan is still technically active, but the husband's company is now the only sponsor. Does this participant HAVE to take her money out? Her employer is no longer a sponsor, BUT the account still exists. Thanks!

Thank you Bird. That's the way I am leaning too.

As title suggests, I have a one-person 401(k) Plan that is closing effective 12/31/18. We are, of course, getting trailing dividends and interest well into January 2019. Those div/int are about $1100 out of a 1.9MM plan. Should I: 1) File a 2018 1099-R with the grand total of distribution (once all those div/int have posted, even though those dollars don't technically leave 401(k) Plan until Jan 2019)? Or , 2) File a 2018 1099-R for the total rolled out as of 12/31 and then don't file another 1099-R for 2019 (because those div/int amounts are so de minimus)? Or, 3) File a 2018 1099-R for the total rolled out as of 12/31 and then a 2nd one for 2019 for those trailing div/int? Then, the follow-up related question is about a Final 5500! I do not want my client to have to pay me to complete a 2019 5500 just to report the distribution of those pesky dividends & interest! The amounts are SOOOO low, relatively speaking. If I file a Final 5500 for 2018, I should show the distributed amount as the same amount shown on the 2018 1099-R, right? Sorry this is so long. I searched for the answer before posting this, but cannot find anything relevant (maybe I'm not great at searching). Thanks so much for anyone's help.

Thank you Appleby. I hope the answer is your #1. The Plan document has always allowed for Roth, so I don't believe it's your #2 answer. I hope that when my client speaks with the financial custodian, he will be able to explain the situation. I have also offered to help by speaking with them (as TPA), of course. Thanks for your thoughts. Just sort of wanted to raise this up the flag pole, so to speak, to see if my problem is common or not. It appears that we are okay, and that it's the financial house's misunderstanding. Thanks!!