Jim Chad

I agree with Bird. I would not file with a beginning balance that is different from last year's ending balance. I would prefer to amend 2006 return by changing the gain/loss and ending balance. But there is not enough time for that. The DOL would not process the change in time and you would get a letter from them. This is a big can of worms to open for no good reason. I would zero it out in gain/loss and or in contributions on the 2007 5500

Here's one Austin. Board_resolution_to_remove_trustee.doc

FWIW I think you would have a multiple employer plan as soon as the change in ownership occurs. So, I think you would test the two employers separately at year end. I'm not at all sure about this. Does anyone else have an opinion?

Have any Key Employees made deferrals or received any Employer contribution?

Katesmithpa I don't think your situation is the same as the original post.....or did he mean to say no match in the prior year where you said no deferral? Since we are talking about shifting deferrals to the ACP test, there had to be some. Maybe your document provider's point may have been that you can't use shifting to pass coverage, only to pass the ACP. At least that is a guess, FWIW.

Let me try to clarify something....the one year hold out rule has nothing to do with eligibility. It has to do with when you do the paperwork on letting a rehire back into the Plan. Many documents will give you the option to wait a year before allowing a rehire back in the Plan. But then, if the employee stays for a year, you have to go back to the date of rehire with all beneifits. I find this choice to be a pain and I try to avoid it. K2retire - Are these seperate accounts so the money is in that Participant's account? or is it pooled?

If it is a calendar year plan, I would think you would do a true up for 2007, the same way you would do a true up for a match. And then maybe use EPCRS for previous years. As for prior years, is this a small plan where only the owners got shorted? If yes, I might consider preparing an amendment and put a current signature date on it. There is no statutory basis for this. I am going on the idea that someone thinks this was changed years ago and you can't find the amendment. On a recent audit, we could not find a document anywhere. I am happy to say that the audit was for the year before I took over. We asked the IRS ayditor what to do. This was a plain 8% of pay MPP. She said that the document I did for the year after audit was "OK" . She did not like it, but it was the best that we could do. You may want to run this idea by the IRS anonymously. ....or consult an ERISA attorney.

I can't see how to do the one year hold out rule in 401(k). How can you retroactively let the Participant defer? It makes sense to me to apply it only to the 401(a) and 401(m) parts of the plan. I would let the person defer immediately. FWIW

I have never done it myself, but I have heard of people doing this sort of thing by setting up on Relius as divisions. Can you tell us anything more about this? Is it a Multiemployer Plan?

A 401(k) client is starting a NQDC Plan with both deferral and employer money, and wants me to administer it. Their attorney will be preparing the "documents". They want me to give them an estimate on fees. What work will be involved besides an annual valuation on the assets held in the Rabbi trust?

Darn! Hit the send button too soon. My email is Jchad@lettinga.com

Hi John: Please give us your email address or phone number. Maybe we can figure out how to start this list.

For a long time, I have always applied for an EIN for every Plan I administer. THis is easy, but it does take some time. When using one of the 401(k) Platforms such as John Hancock, ING or Hartford, they do the 1099's , 1096's and 945's using their EIN. Does anyone see any reason to apply for a plan EIN under these circumstances?

Thanks for the ideas. You are all a big help!

Does anyone know of a report in RA 12 that reports Roth separate from Pretax or else tags the number with and * signifying footnote or an R signifying Roth? I am wondering if there are any kinds of reports. Participant statements, account summary, contribution report or anything else?

I just took over administration of a Plan that needs an audit for last year (PYE June 30, 2007) for the first time. We may not be able to get all the information the CPA's need for the audit. One thing that seems no on has a copy is the 1099s for 2006. Without them the auditor says they cannot confirm that money was paid out of the Plan to thes 6 participants. 1, Does anyone have any suggestions about how we can show that money out of pooled investments were paid to Participants, other than cancelled checks? 2. What are the options if an audit cannot be completed?

Great Report! Tom! Thank you very much!

Doing a crss tested plan on 12.1.2. Does anyone know if Relius has a report which shows who is in what class? Ideally it would show Employer contributions and be sorted by class with totals by class?

If the Participant is not an owner and he is still employed, I don't think there is a Required Minimum Distribution. IMHO

Thanks, Tom. What version of Relius is the report currently on?

Derrin: Would a standardized prototype always pass testing because everyone who did not receive the discretionary nonelective be excludable because of less than 500 hours?

Derrin and Bird - Thank you for confirming that I was on the right track. I have a call in to Relius support asking what reports they have to help me find which HCE's and which NHCE's get only SHNEC and which people get both. For those viewers who are interested, I will post what they come up with. Thanks again.

Dan, I understand what you are saying about adjsuting comp. But is there any authority or logic for him to change the deferrrals to an amount smaller than the 415 limis?

I think Relius may not be telling me everything I need to know when testing a 401(k) Plan with a 3% SHNEC and a 5% profit sharing with permitted disparity and a last day requirement. The coverage test tells me everyone benefited for 401(a). This is correct because everyone received the Safe Harbor contribution. But some people with more than 500 hours did not recieve the discretionary nonelective contribtuion. I have a prototype document so in theory I should have a design based safe harbor for nondiscrim. Do I need to test the discretionary nonelective for coverage seperately or do I need to test the whole 401(a) contrib for nondiscrim? Or am I just making things more difficult than they need to be? What report is best for this?

Let's look at just the part where you said the employee was told he would make $50,000 and $2,500 was gong to be put in his retirement plan. ( I changed the wording a little. Does this still say what you want it to?) This does not sound like an elective deferral. It sounds like the employee has no choice. So it is a nonelective contribution. And it is part of the compensation package. Certainly it is part of the labor costs to the employer. But his compensation on his w-2 and for our purposes is not $50,000. It is $47,500. For years, I have had a Plan where the owner gives his one employee a $2,000 profit sharing contribution. Every year I have to figure out what the owner gets to match the document and the $2,000 for the employee. By the way this is not as hard as it sounds. As far as this working for a partner: It sounds like the normal situation for me. An owner decides how much of an employer contribution he sis going to make and how much he will receive in cash. Of course how much goes to who must follow the terms of the document.