Tom Poje

the rules are the same as for safe harbor 401k - if there are no other contributions besides deferrals and safe harbor, the plan is not top heavy (assuming otherwise excludable option is not used)

sorry, with 15 people in the office, there are no leftovers. I barely get to sample anything I make. (I do buy some sugarplums to give away, because it wouldn't be Christmas without those 'dancing around' many years ago I was visiting my sister over Christmas, and I was given the task of hiding one gift behind the door (or where-ever) for my niece. well 'Santa' left her a note to look behind the door. but that only led to another note somewhere else, to another note, etc. my niece couldn't believe Santa would do something like that - Santa was really cool for doing that. oh plus she had left some tiny tots candy for Santa, he ate all but the green ones because he didn't like that flavor. the niece was really surprised, because those were some of her favorites.

I was hoping Garl Lesser would answer since he knows everything about SIMPLEs. technically you really aren't funding the plan - the $ are already there, so it is a bizarre situation. as for carving the roast beef...well, not from this grinch. by the way, that really is me. I have to do 'extra' stuff for the company Christmas party. while I don't do the roast beef, I have made a bunch of different cookies, plus they get 3 types of homemade bread (the best is a walnut-paste filled bread) oh, plus the chocolate covered pretzals and whatever else I decide to put together in a colorful Christmas bag.

my leanings are you can't 'allocate' the $ either, but the IRS has said you can do forfeitures - and those would be based on comp, so its a strange situation that is not written up anywhere I know of. I know transfers and rollovers dont violate things either, but I am not really sure if that would refer to this situation either. the 'release' of these dollars is not deductible, so they act like forfeitures, and maybe in one sense of the word they are 'SIMPLE' then. as for Christmas, I heard one school banned Rudolph the Red Nosed Reindeer, because it mentions "Then one foggy Christmas Eve", and that is pushing religion on someone. I say BAH!, but then I am a Grinch, so what do I know? (I was well pleased with hair this year, lovely shade of green, don't you think.

the rules say you are allowed to have a SIMPLE IRA and still allocate forfeitures to another plan. not sure of the reason for this, maybe because you are not deducting anything in regards to the forfeitures. anyway, came across an indivual who had a DB. the DB was terminated and the excess assets were rolled into a new DC plan. so of course the question becomes: can you 'allocate' the excess assets and still have the SIMPLE IRA?

A plan MUST allow you a chance to make catch-up contribution, otherwise it fails 'universal availability'. the preambe to the final regs words it as follows: "Catch-up eligible participants do not have an effective opportunity to make catch-up conttributions unless the applicable emploer plan permits each catch-up eligible participant to make sufficient elective deferrals during the year so that the participant has the opportunity to make elective deferrals up to the otherwise applicable limit PLUS the catch-up contribution." then there are examples of how a plan could operate within the guidelines. thus, if, as Mike suggest a possibilty, that the plan "doesn't allow it, you can't force them to take it" then the plan is in clear violation of universal availability. this could mean disqualification or whatever else accompanies such violation.

its the law. you have to have a distributable event such as termination, age 59 1/2 in service withdrawal, etc. once you get past the April 15 deadline. see 1.402(g)-1(e)(8)(iii) I think its because the IRS are a mean one, Mr Grinch!

yes, its time for me to be nasty again, so I am posting the puzzle again. though there are even more songs than before (its now 120) along with the song list (getting soft in my old age) of course there are more songs on the list than 120, but if you saved last years stuff then you should have 100 done already. no, I did not create the puzzle, I am just a nasty grinch who wants you to get behind on your office work. yes, that really is me.

during the ASPPA webcast the other day, the individual from the DOL recomended that all participants receive the notice the 'first' year, one of the reasons being it gives 'pre-emption' relief. after that, only provided notice to new ees or those that have default investment

correct. you must actually be eligible to be included in the test. (ees who took hardships are considered eligible) thus, as a reminder, you do not include people in the ACP test who are eligible to defer, but could not get a match because of hours or last day requirement.

lets look at it from a different point of view. lets say you have issued the notices and everything else this year and next year rolls around and you don't issue notices. does the plan cease to be a qualified auto enroll - or would you say "its too late to be auto enroll for next year?" NO. of course the IRS may frown on things to a greater degree if its the first year of the plan... in fact, (at least if the notice works the same way as for safe harbor plans) if the document has been amended (or will be amended) before the begining of the year you have such a plan. at that point in time, you have a failure to follow the terms of the document - namely issuing notices - which, at least in regards to safe harbor 401ks the IRS has said is correctable under EPCRS by issuing notices (though if the safe harbor was a match they haven't explained how to correct) as was noted in the previous comment, 30 days is deemed reasonable. I myself wouldn't push things, especially the first year of the plan.

see if 1.410(b)-7(f) helps this comes right after 1.410(b)-7(e) "Determination of plans in the testing group for average benefits percentage test"

no notice is required that I am aware of (since the plan is no longer safe harbor). the smm should be sufficient.

as ASPPA will have a webcast on Automatic Contribution Arrangements on Tuesday, and another one on QDIAs on Wed, my thought is too wait until after I sit on those before I express my 'opinion'. (or if you are a member of ASPPA sign up for the webcast and sit in on the thing)

one idea is that the notice is an extra reminder to all 'eligible' employees about the right to defer. (so then why aren't regular 401k plans required to 'remind' employees) in addition, at least with the notices I've seen, they note that if you are a member of the 'otherwise excludable' group, even though you are eligible to defer you won't receive the safe harbor. so these would be people who are 'eligible' but not 'eligible' for everything. I'd say union people fall into that same type of group. If you would provide the notice to otherwise excludables, then I'd provide the notice to union folks as well.

a leveraged ESOP had an amazing $19.90 left on a loan from the prior year. That was paid off in the current year. since less than 1/3 of that loan pmt went to the HCEs, then forfeitures (of shares) don't count against the 415 limit? (This year they also made a large cash contribution in order to pay distributions. This resulted in a big chunk of forfeitures as well, so people are bumping into the 45,000 limit.) In future years since there are no loan pmts, does that rule no longer work since there really is no '1/3 of loan pmt' left???

The Corbel documents usually say something like 'any definition that satisfies 414s can be used' (in fact, if you failed the compensation ratio test, you would have to use total comp for testing even though you used a different definition for allocation purposes.)

I agree with you. with lack of any other example, I am going to include the Return and Risk described on the Morningstar disclosure, along with the investment strategy/category description, and also the brief composition of the portfolio analysis. I only have one at the moment, a non-safe harbor, and have managed to squeeze it all into 3 pages.

the sample language for automatic enrollment ws released by the IRS yesterday, and looks like the following. (Guess I need to modify my initial attempt a little, [still, I should be able to get a form to be produced out of Relius]) now my goal is to get it to 4 pages

The song is from my collection of (miss) hits "Pension Songs in American History" I think I am up to 11 of them now. (They only get worse than Old MacDonald, especially if you are a Beatles or Elvis fan)

does anyone have a sample? I've dummied up a safe harbor notice the best I can, looking for any comments if I have missed anything, etc. the highlighted parts pertain to the auto enroll requirements (unless as I say I have missed something. ) If I wait for the govt, well it might be forever.

as you indicated, Roth contributions are treated as 'ER elective contribution' 1.410(b)-5(d) says only employee contributions are disregarded. Roths are not considered ee contributions (though for all practical purposes they sure do seem like them. must be that Roth label

include them in avg ben % test (unless by chance they would also happen to be 'catch-up' contributions)

e, i, e, i, o.... JanetM: the actual words go like this: Old Macdonald had a plan He needs an E-I-N And in this plan he has match E-I E-I-N There’s a deferral here a deferral there Here a match, there a match Everywhere a match match Old Macdonald had a plan E-I E-I-N Old Macdonald ran a scam I-O I-O-U And in this scam he stole the dough I-O I-O-U Steal a few bucks here steal a few bucks there Here a buck, there a buck Everywhere a buck buck Old Macdonald ran a scam I-O I-O-U Old MacDonald is in jail D-O D-O-L He hasn’t got a chance of bail D-O D-O-L Steal a few bucks here serve a little time there Here a year there a year The judge gave him about 20 years Old MacDonald is in jail D-O D-O-L Old MacDonald’s on parole And living in RIO He has a big fat Swiss Account RIO – R-I-O With a pretty girl here and a pretty girl there Here a grand there a grand He’s got about 500 grand Old MacDonald’s on parole And living in RIO Old MacDonald should be alarmed E-I E-I-O His former help will do him harm E-I E-I-O There’ a gunshot here and a gunshot there Here a shot there a shot Everywhere a gunshot Old MacDonald bought the farm E-I E-I-O

I guess this bears repeating, because it keeps coming up from time to time. It is the document that tells you how to perform any allocation, and by law you have to follow the terms of the document. The notice is, well, just a notice. It was the govt attempt to make sure NHCEs were informed each year that a plan existed (otherwise the HCEs could sock away bucks and have no testing and if the NHCEs 'didn't defer', oh well.) so you can't not 100% vest a SHMAC whether it is an HCE or NHCE. now you can write the document so only NHCE receive the SHMAC, but that would be for next year.