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A plan decides to replace a fund, and due to administrative errors the recordkeeper liquidates the wrong fund. Are they ok correcting the error asap, or do they need to provide another 30 day notice in order to be afforded 404c protection?

A plan outsources hardship withdrawal administration to their recordkeeper. The recordkeeper requests and reviews participant documentation and provides approvals. Can this be considered sufficient for the plan sponsor retaining the necessary records? The records are available for them, they are just retained with their recordkeeper.

They plan to, but the one-time deposit for 2014 revenue is much more than there projected expenses for the year. They're hesitant to allocate it to participants because this will most likely be the only time they'll receive it, and they don't want to set an expectation that they'll get it going forward. But it sounds like that's the safest route.

Thanks, i'm still a bit unclear though. They intention was never for this to be a 'loan'. In this case, this is 2014 revenue but the funds weren't credited until 2015. So i'm thinking this would not be considered a prohibited transaction, agreed?

A recordkeeper has just set up an excess revenue account for a client, but is including a one-time deposit that represents excess revenue from 2014 that was collected but not credited to the plan until now. The client has already paid their 2014 invoices but would like to be reimbursed for 2014 fees they paid for qualified plan expenses (i.e, to auditor, accountant, etc.). What are your thoughts, is this doable?

That is probably the route they should take, given what they want to accomplish. Essentially he'll be excluded from the plan and they will give him a raise or bonus to compensate for any missed employer match. Thanks all for your insight.

They're thinking the employee will establish himself as an LLC and paid as a contractor.

A plan has a full-time employee who is moving to Puerto Rico. They have no other employees in Puerto Rico. They want to keep him, but do not want to get involved in having a dual-qualified plan. If the plan excludes leased employees, would it work if they fire him and rehire him as an independent contractor? It seems the only down side to that is he would be missing out on company match. Also if he becomes a terminated participant with a balance in the plan, would they still need to amend the plan to become dual-qualified in Puerto Rico?

We work with a plan that has very low NHCE participation and is currently safe harbor. They are making safe harbor contributions for a large number of employees, and want to see if there is any cheaper way to go. They want to remove the safe harbor provision and just fail and process refunds each year. We've told them that failing is technically an operational error, but their point is if they correct it by processing refunds why can't they go that way? I should mention they have zero interest in plan health or participant retirement readiness, they basically only offer a 401k in order to attract employees.

We worked with an Erisa attorney on a case like this who was successful in getting a retroactive amendment approved. It was submitted anonymously first. It would help if you have any kind of documentation or can somehow prove that the intent was always to exclude bonus from comp.

Ah, got it...the participant is ineligible to contribute during the suspension, not the compensation. Thanks to all.

A plan has the following elections in the adoption agreement: - Employer elects to match actual elective deferrals made on a payroll basis. - The employer elects to true up safe harbor matching contributions made to the plan on the above basis. The Matching Formula is: Matching contributions will be made on behalf of participants in an amount equal to 100% of the amount of the eligible participant's elective deferrals that do not exceed 3% of compensation and 50% of the amount of the participant's elective deferrals that exceed 2% of the participant's compensation but that do not exceed 4% of the participant's compensation In the case of a participant who had a hardship withdrawal and was not eligible to contribute for 6 months of the year, how is this to be handled? The rk is calculating the match and says the participant's true-up needs to be calculated based on his total compensation for the entire year. That doesn't seem right since he wasn't eligible to contribute for the first 6 months. Can anyone shed any light?

All great points. Thank you, I think we'll stick to education!

10% of participants in a client's plan are invested in multiple Target Date Funds, apparently not understanding the concept of enrolling in the one most age/retirement date appropriate for them. If the client re-enrolls those who are in multiple tdfs into the proper single age appropriate tdf, would they be afforded the fiduciary protections under the QDIA default approach?

A plan has a discretionary match. They were at one point matching catch-up contributions, but decided to stop last year. A participant is complaining that they were not notified of the change. Does the employer need to inform participants of this change via an SMM, or is the fact that the SPD says the following enough? "Your Employer may make a discretionary matching contribution equal to a uniform percentage of your salary deferrals. Each year, your Employer will determine the amount of the discretionary percentage.'

Any thoughts on whether or not excess revenue can be used to offset employer match? I'm assuming no; I know the DOL prohibits the use of excess revenue for settlor expenses, but can't find anything definitive regarding the use of the money for match. Thanks...

I know there isn't a lot of guidance around excess revenue accounts, but I'm trying to see if there is a rule as to exactly when the money needs to be used...is it 12/31 of the current plan year? Is it similar to some forfeiture accounts where you can use it the following year for previous plan year expenses? Or is there no hard fast rule? I should mention nothing on the usage is listed in the recordkeeper's service agreement either.

Should a plan sponsor include language that the plan intends to be 404© compliant in their annual QDIA notice? I can't find that it's required, but it would seem to make sense to me to put it in there. thoughts?

Having a debate...is 30 day notice required to participants in the event you are only adding a fund to a plan, with no mapping? We believe the requirement is only surrounding a blackout period, but certain recordkeepers are telling are clients it's a requirement when even just adding a fund.

Thank you all, I was fearing the worst but it seems like this *may* not be as bad as we thought.

Our client filed an extension back in July, but just discovered that they mistakenly requested an extension until 9-15-14 instead of 10-15-14 like they intended. Now they're technically 9 days late. Any ideas how they need to rectify this? Can they 'amend' their 5558?

A plan has annual automatic enrollment set up that applies to all employees except 2 groups, which are named in an amendment. Does the ACA notice need to them as well, and state that it doesn't apply to these groups, or can it just be distributed to the employee groups that it's applicable to?

If a plan is going through a VCP filing, can the filing and/or legal expenses be paid from the Erisa Budget? I'm having a hard time determining if this is considered a settlor's expense or not.

Agreed... So it sounds like it may be technically permissible, but not advisable. Thanks to all.

If a plan adds a self-directed brokerage account feature, can it be offered to only certain classes of employees or does it need to be available to all participants in the plan? The plan wants to add it so their management employees can use it, but is afraid to make it available to lower-level employees who have less investment experience.