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Pammie57

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  1. I want to make sure I advise this client correctly. The plan document has NRA as age 55. A participant is age 56 and is quitting/retiring in 2024. He has 1.4 million in his account - a good portion of which will go to pay heavy medical bills. Am I correct in what I interpret code 72T to allow - HE will NOT be subject to any premature withdrawal penalties even though he is not 59 1/2? Thanks in advance for any comments/sites/ etc to support my position or dispute it.
  2. Client has a plan that runs from 10/1/2022 through 9/30/2023. Do I use the 2022 compensation of 305,000 or 2023 compensation of 330,000 to calculate the safe harbor for the owners? I can't seem to find that anywhere quickly.
  3. We have a 401k client whose plan funds are in brokerage accounts (each participant has their own - so no pooled); We do admin. work only for this plan and bill the Employer - not the plan. Are we responsible for providing this notice or does the brokerage account provider need to disclose fees, etc on such a notice? Thanks!
  4. I have a 37 year old homebuyer who wants to take a distribution from her ROTH 401k - buying her first home. Is there a dollar limit (besides 100% of her account) that she can take? Is this exempt from the 10% penalty if it's her first home? What if it's her second home?
  5. I have a plan where the partners are saying they are not going to fund their own safe harbor but put in the 3% for all other employees. Is there something that allows them to NOT put the safe harbor in for themselves?
  6. So even if they are "legally separated" - the spouse still must sign off. This should be interesting since they haven't had any correspondence in over 10 years. Thanks.
  7. A newly eligible participant is filling out her DOB. She and her husband have been separated for 16 years. They file their taxes separately. She listed her son as the beneficiary of her 401k balance. Is there any reason why she can't list the son as primary? Does separated spouse need to sign off on that? Any ideas or sites that I can go to to clarify this issue? Thanks!
  8. I took over a plan where the safe harbor contributions was not made for an employee who left June 2021. They were a HCE - and made over $250,000 for that six months in 2021. The safe contribution was never funded for them and is still showing as an $11,000 receivable. The primary question is do they have to make it? He was not an owner.
  9. The Plan document says the following: Eligibility. Rollovers may be accepted from all Participants who are Employees as well as the following (select all that apply; leave blank if not applicable): a. [X] Any Eligible Employee, even prior to meeting eligibility conditions to be a Participant Does this leave any discretion for the Plan Sponsor to not allow rollovers from employees who have not met the plan's eligibility requirement? Or must they allow the rollover?
  10. From what I read the 10% penalty is still due on a hardship withdrawal unless the participant is 59 1/2. The participant asking for the withdrawal is only 40 and it is a construction expense (he said he over-built) for his prmary residence. This is from a qualified plan. Is there any relief from the 10% for this participant? I just want some more back-up because he is relentless on the WHY?
  11. A terminated participant has an account balance with a client 401k plan that exceeds $5000. I have looked through the document several times for guidance. All I see if forms with signature lines for participant and plan sponsor. Q: If the balance is over $5000 and it (plan) is not subject to QJ&S annuity rules - does the distribution form have to be signed/approved by the spouse? Or is that something the plan sponsor can decide arbitrarily? The platform says they are set up to require spousal consent, but I don't see anything in plan document. Thanks for any feedback. They are holding up the distribution for this..
  12. The kids are not actively participating, but since no eligibility requirements - I guess they technically are eligible and may be considered participants?
  13. A client has maintained a SOLO K for a few years - with just him and spouse participating. There is NO age/service requirement - now they hired their minor kids. Since it is still family - is there any requirement to change to a regular 401k at this point? There are NO no-family employees.
  14. The plan was officially terminated - not merged. So the question remains. Is there an exception in the year of termination/distributions that would allow a large plan to file the 5500-SF if the participant count was still over 100 at BOY?
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