Tom Poje

you might trying running this and see what you think, it is one I created. the age factors are hard coed, but until they revise the table the report should work. In the office we run it both individual plan or globally on all plans (a separate report is created for each plan with min distributions) Min Distributions Report.rpt

I suppose if the plan easily passed ADP testing you could shift unused deferrals to the ACP test and that might work at least for some match to the hCEs

yes but at least you are only slightly below the level of ape. this is about as far as I evolved. a lower level, only useful in rare conditions

this started out as a small blurb "what happened on 8/21' or something like that, and I got curious about reading more about the theft (there were no details, just the fact it was stolen)- not even sure I knew it had even happened. Absolutely fascinating story, though if the guy involved in the recovery wasn't named Poggi I might not have shared it. that made a good excuse. the guy was only sentenced to 8 months, the theft drew attention to the art, which was not well known at the time. I guess the theft actually helped make the painting become famous. A number of years ago there was a movie in which the Mona Lisa was stolen and the canvas rolled up and placed in a tube -as I recalled then tossed in the water and later recovered. The comment on the movie was that the error is that the painting is on wood! but it gives one an idea about how large, or I guess how small the painting really is. the fact the guy was able to smuggle it out under his cloak.

'I rang a tan' lady to propose, but she didn't answer the phone, so the answer is no

I see no such language Larry described in the FT William document, and it sounds like ASC might not have that language either. And I would hardly consider them 'wacky'.

thanks for resurrecting this post and reminding me that Belgarath and I are lower than stuffed monkeys. you might want to check http://www.julyservices.com/documents/Newsletter/TexP_2004Issue4_v3.pdf the last paragraph on the first page under exceptions clearly indicates if terminated plan was profit sharing only you are ok

and EPCRS has EPCRS 6.02b (b) The correction method should keep plan assets in the plan, except to the extent the Code, regulations, or other guidance of general applicability provide for correction by distribution to participants or beneficiaries or return of assets to the employer. For example, if an excess allocation (not in excess of the § 415 limits) made under a Qualified Plan was made for a participant under a plan (other than a § 401(k) plan), the excess should be reallocated to other participants or, depending on the facts and circumstances, used to reduce future employer contributions. ... so, ok to reallocate to others if NOT in excess of 415. so going on further in EPCRS EPCRS 6.06 (2) Correction of Excess Allocations. In general, an Excess Allocation is corrected in accordance with the Reduction of Account Balance Correction Method set forth in this paragraph. Under this method, the account balance of an employee who received an Excess Allocation is reduced by the Excess Allocation (adjusted for Earnings). If the Excess Allocation would have been allocated to other employees in the year of the failure had the failure not occurred, then that amount (adjusted for Earnings) is reallocated to those employees in accordance with the plan's allocation formula. If the improperly allocated amount would not have been allocated to other employees absent the failure, that amount (adjusted for Earnings) is placed in a separate account that is not allocated on behalf of any participant or beneficiary (an unallocated account) established for the purpose of holding Excess Allocations, adjusted for Earnings, to be used to reduce employer contributions (other than elective deferrals) in the current year or succeeding year. ... so I think the IRS is correct. you have pro-rata, everyone get 25%. but since you can't get more than 53,000, that excess amounts gets tossed into suspense, and not reallocated since it is a 415 issue, and that seems to be forbidden by EPCRS 6.02 the only possible out but it sounds like pushing the envelope, same document Kevin C listed has Prior to determining the Participant's actual Statutory Compensation for the Limitation Year, the Employer may determine the maximum permissible amount for a Participant on the basis of a reasonable estimation of the Participant's Statutory Compensation for the Limitation Year, uniformly determined for all Participants similarly situated. As soon as is administratively feasible after the end of the Limitation Year, the maximum permissible amount for the Limitation Year will be determined on the basis of the Participant's actual Statutory Compensation for the Limitation Year. my only possible problem with that, is it is like saying we are going to contribute 27.054% to everyone (which we know is over the 25% plan limit) , but limit people at 53,000. and by chance this comes out to be 25% of total comp. on the other hand, if it is known a plan would fail the ACP test you can limit the HCE match, so maybe it can be argued the same, that the formula was indeed 27.054% and the contribution was limited. Instead of we allocated 25% to all, and since folks are limited to 53,000 we allocated the excess to others. same result, different reasoning.

the question is "what %". You indicated 3 persons. ERISA Outline book has the following Chapter 4 Section XII Part B.1.e Acquisition of employees 1.e.2 Suppose that comp W does not agree to transfer the acquired employees account balances into its plan. In this case, the acquired employees vest in their account balances because the sale of these employees constitute a partial termination (over 75% of the employees) [in the example it was a large % that was acquired. unknown what your % is. the general rule is if it is 20% that constitutes a partial plan termination]

apparently the Italian branch of the Poje family (ha ha ha) helped recover the painting In the Autumn of 1913, two years after the Mona Lisa was stolen, a well-known antique dealer, Alfredo Geri, innocently placed an ad in several Italian newspapers which stated that he was "a buyer at good prices of art objects of every sort." Soon after he placed the ad, Geri received a letter dated November 29 (1913), that stated the writer was in possession of the stolen Mona Lisa. The letter had a post office box in Paris as a return address and had been signed only as "Leonardo." Though Geri thought he was dealing with someone who had a copy rather than the real Mona Lisa, he contacted Commendatore Giovanni Poggi, museum director of the Uffizi (museum in Florence, Italy). Together, they decided that Geri would write a letter in return saying that he would need to see the painting before he could offer a price. Another letter came almost immediately asking Geri to go to Paris to see the painting. Geri replied, stating that he could not go to Paris, but, instead, arranged for "Leonardo" to meet him in Milan on December 22. On December 10, 1913, an Italian man with a mustache appeared at Geri's sales office in Florence. After waiting for other customers to leave, the stranger told Geri that he was Leonardo Vincenzo and that he had the Mona Lisa back in his hotel room. Leonardo stated that he wanted a half million lire for the painting. Leonardo explained that he had stolen the painting in order to restore to Italy what had been stolen from it by Napoleon. Thus, Leonardo made the stipulation that the Mona Lisa was to be hung at the Uffizi and never given back to France. With some quick, clear thinking, Geri agreed to the price but said the director of the Uffizi would want to see the painting before agreeing to hang it in the museum. Leonardo then suggested they meet in his hotel room the next day. Upon his leaving, Geri contacted the police and the Uffizi. The Return of the Painting The following day, Geri and Poggi (the museum director) appeared at Leonardo's hotel room. Leonardo pulled out a wooden trunk. After opening the trunk, Leonardo pulled out a pair of underwear, some old shoes, and a shirt. Then Leonardo removed a false bottom -- and there lay the Mona Lisa. Geri and the museum director noticed and recognized the Louvre seal on the back of the painting. This was obviously the real Mona Lisa. The museum director said that he would need to compare the painting with other works by Leonardo da Vinci. They then walked out with the painting. Leonardo Vincenzo, whose real name was Vincenzo Peruggia, was arrested. The story of the caper was actually much simpler than many had theorized. Vincenzo Peruggia, born in Italy, had worked in Paris at the Louvre in 1908. Still known by many of the guards, Peruggia had walked into the museum, noticed the Salon Carré empty, grabbed the Mona Lisa, went to the staircase, removed the painting from its frame, and walked out of the museum with the Mona Lisa under his painters smock. Peruggia hadn't had a plan to dispose of the painting; his only goal was to return it to Italy. The public went wild at the news of finding the Mona Lisa. The painting was displayed throughout Italy before it was returned to France on December 30, 1913.

the preamble to the 401k regs had The preamble to the 401(k) Regulations describes it as follows: One commentator asked for clarification of the interaction between these timing rules and the rule under the regulations that treats a self-employed individual's earned income as being currently available on the last day of the individual's taxable year and whether this last day rule precludes a partner from making elective contributions during the year through a reduction in the partner's draw. The restriction on the timing of contributions is not intended to prevent a partner from deferring amounts that are paid to the partner throughout the year on account of services performed by the partner during the year, and the final regulations have been modified to clarify this point. However, self-employed individuals who take advantage of this opportunity to defer amounts during the year must make sure that the amount contributed during the year will not exceed the limits (such as the limits of section 415) that will apply to the individual, based on the individual's actual earned income for the relevant period. ...... let's make the question even easier. suppose you deferred $6000. by the time the self employment income is figure he is at 0. you can't have any catch-up because you have 0 income to put into the plan in the first place. in other words, the $ deferred into the plan, based on a draw don't exist and have to be removed and returned to the company.

this rule is found in 416(g)(4)(H) as I recall, the one exception is if otherwise excludable employees were eligible to defer but were excluded from the safe harbor.

you can't change the status of someone already eligible, but if someone hasn't met those requirements you can change. this is from the IRS website https://www.irs.gov/retirement-plans/mid-year-changes-to-safe-harbor-401k-plans-and-notices Examples of permissible mid-year changes If they satisfy the notice rules, if applicable, safe harbor 401(k) plans sponsors may mid-year: Increase future safe harbor non-elective contributions from 3% to 4% for all eligible employees. Add an age 59 ½ in-service withdrawal feature. Change the plan’s default investment fund. Alter the plan rules on arbitration of disputes. Shift the plan entry date for employees who meet the plan’s minimum age and service eligibility requirements from monthly to quarterly. Adopt mid-year amendments required by applicable law (for example, statutory law changes or court decisions). Examples of impermissible mid-year changes Safe harbor 401(k) plan sponsors generally can’t mid-year: Increase an employee’s required number of completed years of service to have a nonforfeitable right to the employee’s account balance attributable to safe harbor contributions under a qualified automatic contribution arrangement (QACA). Reduce the number (or otherwise narrow) the group of employees eligible to receive safe harbor contributions. This prohibition doesn’t apply to an otherwise permissible change under either eligibility service crediting or entry date rules made for employees who aren’t already eligible (as of either the effective or adopted date of the change) to receive safe harbor contributions under the plan

if the match was by payroll, I'd say it makes sense to include/exclude based on participants election. otherwise, unless there was something specific in the document, I would include it. most of the documents I work with indicate a participant can make an election change anytime. so I would view that as saying each payroll period I elect to defer, defer, defer..oh the bonus check I elect not to defer, and the I start up again. otherwise, how do you handle something like only HCEs defer off the bonus and none of the NHCEs defer. I'd think if you don't include it then at the minimum you have to run a comp test because now you are treating it as 'excludable comp'...but I could be way off on my thinking there.

I would describe it as follows: the minimum distribution is always 'due' by 12/31. now, we will let you delay the actual distribution the first year until 4/1 of the next year (April's Fool, how appropriate), but that is just the timing of it being in his hands. let's suppose the person was 70 1/2 and quit 12/30. Of course most of you folks would be ready to pay him out 12/31. But the govt realized there are folks like me that wouldn't be ready or even lucky to find out about it by 4/1. I actually modified my report so the min distribution report (distributions due by 12/31/2018) prints a message on any active participant over 70 1/2 'you will be due a min distribution if you quit during 2018'

for example, instead of a checklist the document might simply say (This example provides to all employees not just non-key employees. (j) Participants eligible for top‑heavy allocation. For any Top‑Heavy Plan Year, the minimum required allocation set forth above shall be allocated to the Nonelective Contribution Account of all Employees who are Participants and who are employed by the Employer on the last day of the Plan Year regardless of the Employee's level of Compensation, including Employees who have (1) failed to complete a Year of Service; and (2) declined to make mandatory contributions (if required) or, in the case of a cash or deferred arrangement, Elective Deferrals to the Plan. ...... You may ask why would you give to all not just non-key employees, but the answer would simply be "If the non-keys are getting 3% why wouldn't you want the key employees to get 3% as well. In your case, in which the only employees are key employees the answer might be different because non-keys receive nothing.

under the stock attribution rules of 318(a) children are deemed to own the stock of their parents (even if they are adopted children) so based on what you indicated, all employees are key employees note: of course, the document is important!!!!! for instance if item (ii) was checked rather than (I) then top heavy is still due! 8. Top-Heavy Allocations Top-Heavy allocations are made to a. [ X ] This Plan. Participants who share in Top-Heavy minimum allocations: i. [ X ] Non-Key only. Any Participant who is employed by the Employer on the last day of the Plan Year and is not a Key Employee ii. [ ] All Participants. Any Participant who is employed by the Employer on the last day of the Plan Year iii. [ ] Participants covered by a collective bargaining agreement will share in Top-Heavy minimum allocations provided retirement benefits were the subject of good faith bargaining.

July's rate was 252.006 if Aug and Sept are 254.000 and 254.000 then I would get the limits increasing, but that would be quite a jump assuming I have things plugged correctly indexed limits and soc sec.xlsx

possibly more information is needed, something like 'will all the assets be paid out within 1 year of the term date'. at the 2010 ASPPA Conference Q and A #3 the following was asked (the question applied to top heavy, but the same concept applies) DC plan is top heavy and has a plan year ending 12/31. The plan terminates on September 15, 2010. Normally, TH minimums are provided only if the employee is employed on the last day of the plan year. (Assume that there are salary deferrals during the year so that, if a top-heavy minimum is required, it needs to be made.) The IRS response was: Of course, if there is no employer contribution, there would not be an obligation to provide top-heavy minimum contribution. But, if there were contributions to keys during the year, including elective deferrals, there is a top-heavy minimum based on compensation and employment through 9/15/10. Plan must liquidate within a reasonable time under Rev. Rul. 89-87 or else 9/15 date may not be reasonable. There is effectively a short plan year for top-heavy purposes. ........................... I guess that means if assets aren't paid out then you only have a frozen plan instead of a terminated plan

I couldn't figure out what you meant by RPT, but I guess you mean ratio % test. there is no reason you can't use that test that I can think of. you can't aggregate a safe harbor with a non-safe harbor - but other than that permissive aggregation rules should apply. there is one average benefits percentage test consisting of all contributions (unless you test otherwise excludables separately and then of course there would be 2 average benefit percentage tests.) but that is just the percentage test, not the average benefits test itself.

there is one case described in the ERISA Outline Book if termination of plan was part of dissolution of sponsor then basically there would have been no way a terminated person could have returned to work in the future and earned more service, so therefore would not be 100% vested. this was a private letter ruling, so even the Book recommended use with caution. chapter 4 part A 1.e

Forbidden. 1.401(k)-(b)(4)(iiii)(B) ...for example a plan that applies the current year testing method may not be aggregated with another plan that applies the prior year testing method. (And you have to be consistent, if you aggregate for coverage you have to aggregate for nondiscrim and vice versa)

1. Because they could defer they are included in the avg ben pct test. 2.Terminated participants who work over 500 hours are included in rate group testing as 0 (includable and not benefiting).

the problem with the match in the original question is having a last day rule. that fails the safe harbor requirement. but since you are permitted to run the ACP test including safe harbor match contributions it is doubtful the plan would fail ACP testing. 1.401(m)-2(a)(5)(iv)...a plan that satisfies the ADP safe harbor can exclude matching contributions that do not exceed 4% of all eligible employees. . At the 2013 ASPPA conference, Q and A 22 the question was asked May a plan that limits the ADP/ACP safe harbor to NHCEs only also have a discretionary match for HCEs only (provided such match doesn't exceed the NHCE at any level) and the IRS responded in .the affirmative (Granted such responses don't necessarily reflect an actual Treasury position) ............... so 1. does the plan satisfy ADP safe harbor? - yes 2. does the plan satisfy ACP safe harbor - yes, when looking at the combination of all matching contributions. Recall, when looking to see if a plan satisfies the requirement that no HCE receives more at any level of match you look at the combination of all formulas, not just the individual match formula. I assume that means BRF is done in the same manner. And the discretionary can have vesting applied as long as there are no eligibility requirements (e.g. hours or last day) So it appears you could do this, if the Corbel document had said "ACP safe harbor' instead of 'ADP safe harbor' I would have said that would work. I did not notice that subtle language difference the first time on the post I pulled the document language.

Bill- You crack me up, reminding me of the days when I worked Pentabs support and someone called and asked why the compensation for the HCEs was getting reduced. The old family 'aggravation' rules - somehow the guy coded the system as family members but didn't know the rules that it was combined comp of all family members that was capped at the comp limit. and his response was somewhat similar to yours "I must have been asleep when they came out with that rule"