Pammie57

Thank you.

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.

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.

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!

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?

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?

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.

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!

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.

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?

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?

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..

The kids are not actively participating, but since no eligibility requirements - I guess they technically are eligible and may be considered participants?

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.

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?

We had a client whose plan had been a large plan for several years, and filed the 5500 and an audit report. They terminated their plan mid 2021 and rolled all balances into the plan of the company who acquired the former plan sponsor. The new TPA is telling me that they are not required to file the 5500 for 2021, but can file the 5500-SF. I though it was based on participant count at the beginning of the plan year. (which was over 120) Obviously, they had zero participants at plan year end. Thanks for any insights.

We had a client whose plan had been a large plan for several years, and filed the 5500 and an audit report. They terminated their plan mid 2021 and rolled all balances into the plan of the company who acquired the former plan sponsor. Their TPA is telling me that they are not required to file the 5500 for 2021, but can file the 5500-Sf. I though it was based on participant count at the beginning of the plan year. Obviously, they had zero at plan year end. Thanks for any insights.

Schedule A

if a plan has assets with VOYA or a vendor like this, is there a requirement to attach/create a Schedule or do you just report fees/commissions on 5500-SF

term dates in May 2021 - stock sale - new owners are still running company.

Client sold business in 2021. They have a 401k Plan with a discretionary match (calculated after year end) The three owners are all over the age of 65 (NRA per the plan doc); their plan does not allocate the discretionary match to terminated participants. Could we consider them retired instead of terminated at the date of the sale, and allocate them a match for the year? I know at the time of the sale nobody was focusing on the plan.....

Client company sold and all of the HCE's terminated in May 2021. They immediately took distributions. Now as I run the ADP/ACP test I find that a corrective distribution was due one of them. Do they need to have the Platform reissue the 1099R and if they rolled the funds - do they have to withdraw it from their IRA?

A 401k plan terminated on 4/25/2021. All participants were paid out by 10/15/2021. The plan is /has been over 100 participants at time of termination due to a sale of the business. Do we as TPA just need to request census information through 4/25/2021 since all contributions ceased then or through a later date? like through 10/15/2021? I think it's through 4/25/2021 but the auditor is suggesting the latter date. Please give me opinions based on experience. Thanks!

We have a client that is a non-profit organization with a 401(k) Plan. I know they could have either type of plan- (403b or 401k)..They want a nutshell reason why a 401k is better than a 403b or/an explanation of the primary differences in the two. Does anybody have a concise answer or opinion on this. They don't have many participants yet. Thanks!

Client has a profit sharing plan (non-401k). He lets about 15 people go which results in over 20% of the participants being terminated. Then two more quit within two weeks of the others being let go. The question is about the two who voluntarily quit....are they also 100% vested or not? I have no idea if they were encouraged to quit or not.