ratherbereading

All affected participants become fully vested in their account balances on the date of the full or partial plan termination, regardless of the plan’s vesting schedule. Affected participants are current or former employees who haven’t received full payment of their vested interest by the plan termination date, unless they’ve incurred at least 5 consecutive 1-year breaks in service. Retirement Plans FAQs regarding Plan Terminations | Internal Revenue Service (irs.gov)

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Thank you!

With all the new hardship distribution rules, is anyone still advising the Plan Administrator to get proof of hardship in case of plan audit? Participant wants to take 100% of his funds ($360,000 plus). He provided the wording below from the IRS to show he did not have to submit proof: Also, he claims the IRS told him via phone call he did not have to submit proof. Thank you! 3. How does a participant show that he or she is experiencing a hardship? Generally, if a 401(k) plan provides for hardship distributions, the plan will specify what information must be provided to the employer to demonstrate a hardship. Most 401(k) plans use the "deemed necessary" rules described in Q&A-2 above, so that inquiry into the employee's financial status is not required. In other cases, an employer may generally rely on the employee's representation that he or she is experiencing an immediate and heavy financial need that cannot be relieved from other resources. However, an employer cannot rely on an employee's representation if the employer has actual knowledge that the employee's need can be relieved: (1) through reimbursement or compensation by insurance; (2) by liquidation of the employee's assets; (3) by stopping elective contributions or employee contributions under the plan; (4) by other currently available distributions (such as plan loans) under plans maintained by the employer or by any other employer; or (5) by borrowing from commercial sources. (Reg. Section 1.401(k)-1(d)(3)(iv)(C))

I'm sure it's legal. These teams have attorneys/accountants, etc. The Yankees CEO Randy Levine is an attorney. I wouldn't mind that salary.

Very similar issue with one of our plans and yes we did complete question 4.

The first paragraph is a little confusing ... it sounds like the violation occurred because he was very upset? I think this question is beyond the scope of this board, but maybe someone else will chime in.

Thank you!

No 1099R was issued, it's just showing as Deemed. The loan was for 2 years and the client thinks it was paid off timely, but it wasn't, there is still $200 plus left. Not sure if the CARES Act can come into place as no paperwork was filled out to defer the loan. Thanks!

In 2020.

Pretty sure this has been addressed before, but I can't find the discussions. Active participant last made a loan payment in 2020, thinking it was paid off. Investment house is showing she still owes $200 plus. Investment house shows her loan as Deemed. Can she still pay it off, and if so should she get a 1099R showing the loan default? Thanks!

We take 10% unless the participant waives the withholding or chooses another amount. From what I can find, that is the IRS rule.

Welcome!

Retirement distributions (early or normal) are "retirement income" and are taxed by your state of residence at the time of the distribution.

Good idea...

We do a download into Relius from the investment company then compare what the client gave us to what actually hit the investment company. There census was mess but finally got it all straightened out. I should have known when all was said and done that the remaining small amounts were from the gain/loss and not included them, but unfortunately, I did not. Yes to your second question!

I have a plan who failed the adp/acp test and refunds were processed. I included the gains from their late deposits in the test as they were not transferred to earnings at the investment house. It affected about 30 people and except for 2 people the amounts were well below $1.00. The other 2 were around $2.00. Is this a huge deal?

The job postings are for TPAs, etc. looking for staff. You can put your own ad out there but the cost might be prohibitive considering what you're looking for. I am also going to PM you.

We count it as such. But it's supposed to be zeroed out each year, like the forfeiture account.

I have plans with Empower and AF with net credit accounts but I've not seen them reported as negative fees. I have them allocated as earnings or used for plan expenses every year and we show them as earnings on the 5500.

I couldn't help it ...

**game** the system

How to Protect Your IRA from Creditors | Retirement Watch

Thank you!

Have a plan that failed the adp acp test. Participant is 60% vested. Relius is showing Allocable Income on the ACP correction. Is it 60% of the Refund Amount that is forfeited? How does the Allocable Income come into play then?