RatherBeGolfing

Ive seen it in past years, but we had a very large sample size. Did it specify name mismatch? Other common mismatches are plan year for short years, and EIN in the year of a change.

This is likely a vendor QC, not EFAST. Is it FTW? I have gotten similar errors and had to mess with punctuation, like one missing period

We are still waiting on the final regs, but the proposed regs say that they get to keep the grandfather status. If a grandfathered plan spins out of the PEP, the plan is "treated" as grandfathered, even though it would have a current effective date. Yes

I prefer the online edition for many reasons. The new UX is nice, though Im still getting used to it. I have been playing around with AskERISA over the last week, I really like what I see so far.

Agreed

I'm such a slacker, I haven't had time to dig into the new guidance. Can we no longer check the last 5500 of the distributing plan and assume that it is qualified as long as it doesn't use code 3C (not intended to be qualified)?

H-4 status allows you to apply for EAD. EAD allows you to get an SSN (the card will say only valid with work authorization or something similar).

Everyone's situation is different, so how they handle these situations may be different. What does your service agreement say? Regardless of the above, don't make your client's problem your problem.

Ah that makes more sense. The answer to your question on final testing is... It depends. From your description, the spun off plan will not accept ongoing contributions, it is created just to facilitate the distribution of assets. I would structure the spinoff documentation in such a way that the "new plan" terminates on inception, there is no activity other than the transfer in and distributions. Final testing would happen in the PEP, transfer assets to the spin off plan, and finally distribute the assets. For 5500 purposes, the PEP reports the transfer out, and the spin off plan reports the distributions.

Yea the SEP part of the question doesn't make sense OP, can you expand on that? Generally speaking, ceasing participation in a MEP/PEP is not a distributable event. A participating Employer / Adopting Employer cannot terminate the MEP/PEP, or their portion of the MEP/PEP. You can spin off your portion of the MEP/PEP though. Your starting point should be to speak with the MEP/PEP provider. They should have information for you.

I agree, your 5500 should reflect the contributions, not the deposits. I would book the earnings in the year of correction. Otherwise you would need to split earnings over both years to be accurate, and I just don't see the point. Just be consistent.

Agreed. Let the referring party know that what they need is an ERISA atty, and that you would be happy to take it on once corrected.

Then no issues with using the forfeiture. In fact, you would probably create an issue if you don't use the forfeiture when available.

You didn't bring it up, but no issues with partial plan term, right? Asking since "this was the only non-key participant"... Assuming forfeiture was proper, I don't see a problem using it to fund the THM.

I'd also add that it was taxable when available to them; they can't escape that by not cashing the check (constructive receipt)

We have had an issue or two with 5500s in FTW over the last couple of months, but nothing that lasted more than 30 minutes to an hour.

No, we haven't had any problems (FTW users), but we file directly, not on behalf of the sponsor with a signed copy. How you file shouldn't matter though, SSL handshake is client/server issue, so its a Datair/EFAST issue. No comment from Datair on this?

@Peter Gulia I think its more nuanced than that. The OP states that if the account balance is less than the distribution fee, the account is forfeited. So its not that the distribution fee results in no net payment, the balance is forfeited instead of being consumed by the distribution fee. I share @BG5150 concern here.

As far as I'm aware, this is not an option. It wouldn't pass edit checks since the IRS logic looks for $0 in EOY assets and no participants at the end of the year for a final 5500.

Does it already allow for elective deferrals or is it just PS at this time?

I have always filed using third party software, which produces an AckID for Form 5558 filings. I would still start with EFAST, but be prepared to have to go to the Office of the Chief Accountant.

Im assuming this is not the first year filing a return for the plan, and you filed an SF for the prior year? If so, you can continue to file an SF until you cover more than 120 participants and meet the other eligibility conditions (total of eight conditions). See instructions to the 5500-SF, page 3, Who May File Form 5500-SF, for all conditions.

Sounds like you have an AckID then, so you can prove that it was filed. I would start with EFAST support, but when it comes to issues beyond what can be found in the instructions to the forms, they usually refer you to Office of the Chief Accountant at the DOL at 202/693-8360.

@SSRRS Did you file using third party software (FIS, FTW, etc...)? Did you get an AckID, or did this prevent you from actually getting it filed? While I agree it sounds like an error on their end, it will probably take quite a bit of back and forth to get it resolved.

Without looking I know about 10 in my area, so we actually CAN have a party! 😆