Mike Preston

3 column is much more difficult.

You will be missed!

This is indeed complicated stuff and your post does justice to the complexity. The only part I would tweak is above. The ABT is company wide not plan level. And the threshold is the midpoint not the unsafe harbor. Good job.

Isn't that what was already said?

"can"? Oh, boy! Disagreeing with three folks at once!

Change Trustee. Much better than exposing plan to a charge of violating ERISA. Not a flip response. I mean it.

In the hopes that the following furthers the discussion instead of hijacking it....... I have run into some strange practices from organizations that think they can impose their own will, ERISA be damned. For example, one household name investment company (let's call it "Investment Company A") recently tried to insist that they could not do direct rollovers to any IRA that wasn't an Investment Company A IRA. They were forcing participants to establish an IRA with Investment Company A, direct rollover to that IRA and then "allowing" the individual to rollover/transfer to an IRA with another company. I have no idea what fees they attempted to wring out of the participants that went along with the mandate. Made me wish there was a whistle blower reward of some kind that would apply. They know that very few will have an ERISA consultant/expert willing to suffer through an attempt to reach a non-monkey on the participant's behalf. That would generally make it more expensive so they know most will just go along.

No.

No. No. Somebody else will elaborate.

Look up what excluded shares/stock means. You are correct.

Small correction: the increase is not taken into account for purposes of calculating the cushion. Otherwise, it is taken into account.

Maybe. If your original claim that the document formula is based on either a 2-tier or 4-tier method is correct, then 20% to the owner coupled with 6% to the non-HCE is a violation of plan terms. If the actual document provisions provide for each participant in their own group then 20% to the owner and 6% to the non-HCE not only would not be a violation of plan terms but it also might satisfy non-discrimination and not be discriminatory.

Your 2-tier calculation looks right to me. The 4-tier calc is messed up in more ways than I have time to describe. 2-tier and 4-tier are identical as long as the allocation is more than 5.7% of all pay plus 5.7% of excess pay. If it truly is a sole prop you will need another iterative calculation that revolves around the amount allocated for the non-owner. Good luck.

Sole props don't have K-1 income. Are you sure it is a K-1?

Just for kicks, what other type of partial termination is there?

No. What kind of entity is it? S-Corp? Partnership? Sole Prop?

Plan year concept.

If client doesn't want to correct via SCP (which requires an amendment) then VCP is only option. Otherwise it was not eligible for rollover.

I think we're on the same page. I don't hear anything clamoring for any walk back.

It would be much better if it said that it applies to anybody with an hour of service after such and such date.

Not what is wanted. If the plan sponsor has a reason for the 250 hour threshold why not put it in the plan and be done with it?

What you want to do is allowable and can be accomplished on virtually any document. As the slogan says: just do it.

I think your reading of 2016-16 is too narrow. You missed III.B which directly prohibits what you want to do. Your quoting of III.D is therefore misguided.

What kind of plan?

Not the way the Opie wants to do it. He wants to see his compensation a bit higher to recognize the fact that the medical expense is lower.