Tom Poje

a few years ago I got interested in how the silly numbers were calculated, and then someone else I knew took my jumbled logic and tossed it into a spreadsheet. It might not be perfect, but based on the rules it does provide a good estimation of where thing stand (or what they probably will be for 2004) Each month, around the 20th the govt releases the Consumer Price Index. to determine the indexed figures they take the #s for july/Aug/Sept and divide by whatever was just set by EGTRRA (I don't remember, my mind is mush) Anyway, obviously we dont know the figures yet, but I have plugged in the figures for the most recent 3 months just to see where things sit. (Of course the deferrals limits are locked in place, but the other stuff is still indexed)

416(g)(4)(E) says if any employee has not performed services fpr the employer maintaining the plan at any time during the 1-year period ending on the determination date, any accrued benefit (and the account of such individual) shall not be taken into account. Therefore, I would not include the distribution. I hold this overrides the rule that you count distributions that ocurred within the 1 year period. Look at it from this point of view. Suppose the ee wasn't paid this year. you would not include him. suppose he wasn't paid for the next 15 years. You still wouldn't include him. Now, in year 16 he gets paid. All of a sudden you include him because of a distribution?

you can pull that in the DER under transactions, although, as I mentioned, it might be easier to 'print' a Summary of Accounts to Excel. If you have never done that, it is real easy. I suspect the headers might end up being off, but heck!

since this was a Corbel plan, I called and talked to them, and the response was that the plan should be coded as 'current' if it is safe harbor. (The document software does not default to current if you select safe harbor) I suppose it gets interesting if it was 'maybe we will give 3% SHNEC' you would have prior year in the document, but if they actually made the SHNEC then you would have to amend the document.

This is the easy part cuz I am preparing some notes for a user group meeting on this one. In Crystal open report select Database then Verify Database the system will probably prompt you to log on, usually password is QT then click on OK as it pops up the different items hopefully you will eventually get a screen that will say 'field name not known' that will at least find one of the formulas. if you are unsure what to do with the formula, put 2 '//' in front of it. that will supress it but not delete it. after finishing I would print preview the report. If there are more fields names not known it will find them

obviously if new admin is using Relius you could just export the plan, if you are lucky enough to be on the same update. otherwise, you could export the data via DER, or, alternatively print a couple of Report Writer reports to Excel, and let them do the rest of the work

That is usually an 'update' problem. in my case it involved the user fields they use to be PLANSTAT.USERFIELD10, but at 8.0 that no longer exists, so the report gives that particular message. I'll send Dave a note about attaching files. there seems to be a problem

of course, the net result is that you start losing good help, cuz they will quit. Imagine, excluding people with giant heads or even those with three eyes!

Arch: What was the size of your original report? If it was less than the maximum size I would contact Dave about the problem. I had the same message about a month ago, but I thought he fixed the problem since I was able to attach an .rpt file. Since you attached the report I assume you were able to follow our instructions and make it work, at least on an individual plan level. Congrats!

actually the rest of the cite says 'any other plan of the employer (including plans not yet established)... ...for the duration of the employee's employment with the employer, or in the case of a defined benefit to receive accruals or other benefits (or no benefits) under such plans.' .............. I'm not convinced how you get around 'duration of employment' and 'no benefits', but it could be I'm too conservative. as to KMP's comment about why someone would 'elect out', the only one I have ever come up with is to be able to put into an IRA, especially since the ees were HCEs.

notice 98-52 VIII E clearly states "...a plan that uses the safe harbor methods to satisfy the ADP or ACP test for a plan year is treated as using the current year testing method for that year and, thus, is subject to the rules...relating to changes from current year to prior year testing... so for you document experts, does that mean the document MUST say testing method is current? If the document says 'use prior year testing' does the notice simply override it?

I'd look at 1.401(k)-1(a)(3)(iv) the waiver applies to ...'any other plan of the employer (including plans not yet established)... or, in terms of Papa IRS Too Bad So Sad Your Dad can you say Non Qualified Plan?

Lisa: I can't remember what I was doing 10 minutes ago, you expect me to remember farther back? I have to be there at ASPA. I am scheduled to give one of the talks, believe it or not 401(k) Testing Hierarchy for Beginners so I decided to add that particular question to the list to be covered. Ugh. Monday, 4:15 - 5:30. After everyone is burned out from sitting in talks all day. Oh well, it will be a lively talk, I think the scarecrow from the land of Oz might show up and use that marvelous brain the Wizard gave him. I think he discovered an original version of "Yesterday" by the Beatles, the one that was written about 401(k) plans as well. You just never know!

I'm not sure there is a definite answer. If it was a DB plan, with a term date of 7/15/2002, I would assume at least some ees would have 1000 hours and would therefore be 'eligible' for top-heavy. On the other hand, I would also assume the plan has been 'frozen' in the most ultimate sense of the word. If the plan is DC, top heavy requires ees to be employed on the last day. No one falls into this category (unless you consider the last day to be the 7/15 date), so I imagine you could argue that no one is eligible in that case either.

ps contrib is never ever included in the ADP or ACP test. The only exception would be if it were a QNEC

I would add the following caution: watch out for ees who were 'key' but don't meet these requirements. They are now former key, eligible for top heavy, but ignored completely for determining if plan is top heavy.

one place I think it is inherent is in 1.401(k)-1(a)(2)(iii) ...Similarily an amount is not currently available as of a date if the employee may under NO CIRCUMSTANCES receive the amount before a particular time in the future... but also, what is the only way one can get $ out of a 401(k)? death, disability, termination, etc. there is nothing under those conditions which says, 'or current year deferrals if ee did not work x hours'

That must have been what happened. Got hit in the head with one of those kickballs. That will bury anything deep in the mind. (Put a good dent in the ball as well)

In the back of my mind, buried deep, deep in the recesses, places never to go, I believe you have to rerun the ADP test. 1.401(k)-1(b)(4)(A)(2) you can only count deferrals actually deposited within 12 months!

you are much too kind on your compliments! I guess if they meet your 'smell' test, the clients must be happy as well. someday I will post my top-heavy report. since it doesn't include ineligibles or those ees with 0 balance it really cuts down on the paperwork. Most of the time my results are the same as Relius, I don't pull inservice distributions, and there are a few odd things that take place, but what the heck, generally with top-heavy it doesn't make a difference - you either are or aren't - it is those cases close to 60% by the way: what is bizzare about the user fields, if you have absolutely nothing populated, the report doesn't work at 8.2. If you have one user field populated, even if not used in the particular report, it prints fine.

must be nice, having an HCE getting excludable. that helps all testing. quite often you see this happen with associate attorney and non-associate attorneys being excluded. I will backtrack on one thing. If the plan is top heavy, since the ee is a participant he would have to receive the top heavy minimum (even if excluded from the profit sharing). unless he was 'key' and keys are excluded from minimums.

This is a census verification that includes a column showing deferrals. Relius 8.2 There is a census counter for total on the report, total ineligibles and net total.(used for billing purposes) Perhaps by looking at how that works you can figure out how to add a deferral counter, as Patti indicated using an 'if' statement. e.g.Deferring Counter: if ytddeferamt > 0 (count deferring people) then 1 nondeferring count: if TotComp > 0 (eliminate prior term) and categcd <> 8 (eliminate ineligibles) and ytddeferamt = 0 then 1 and then do a total on these fields if it works, try it and post the report here Note: all my reports have plan name (excluding the company name) buried in Alpha user field 11.

yes, it is possible. You would still have to pass coverage - I am assuming these are non-resident aliens with US income so are not excludable for testing purposes.

It has been an 'adventure' so to speak using the user defined fields in custom reports. The instructions are certainly weak in that area. For example, all user fields have been moved to a table called UDFDATA If your report pulls user fields from both census and plan data you need to add that table twice. Perhaps that concept is obvious to everyone but me and it was considered wasteful to put it in writing. I have verified the database, then added the UDFDATA table and found I had to reverify the database so that the UDFDATA table would be updated. I've used an expression USERALPHA 11 + USERALPHA 12, and found if there was nothing in USERALPHA 12 it imply won't print the expression. fun stuff like that! But, on the plus side, at least each user field is now listed and you don't have to write the extra stuff we have had to do in the past. If you want field 50 you can simply pull that field.

In a safe harbor plan you described (Basic Match provided) the max match would be 4%. Under what conditions would the match on a catch up be needed or come into play? There can't be a plan imposed limit on deferral % preventing someone from obtaining the 4%. You can't fail ADP test, so no need for catch-ups involving excess contributions. That really only leaves excess deferrals as a possibility for needing catch-ups. But an HCE who defers 10,000 with 200,000 in comp has deferred 5%, so he can't be matched on any amount above the 10,000, so no issue there. I suppose if an employee defers 96% you might run into a 415 limit and need the catch up for that ee. I have yet to see that happen, but I guess it could. Maybe I am still half asleep, under what other conditions could it even make a difference?