RatherBeGolfing

Even if the TPA is not actually preparing the return, you still have the issue of control of work product. The short answer would be you can't perform professional services if you have reason to believe that your work will be used to violate or evade the law. So you can't do the work but wash your hands of it just because you prepare the return. Circular 230 also includes language regarding errors or omissions from any return, not just the returns prepared by the practitioner.

I agree, I take my client's representation to me at face value and I don't cross that line either. If a client tries to involve me in a tax avoidance scheme or fraud, I would just resign and move on. Also, I don't think any of the CPAs I work with would tell me "oh by the way, Dr. Payne is giving his kids a salary so they can defer but they they never actually work for him". Even if that was the case, why volunteer that information in the first place?

In your example, is the TPA subject to Circular 230 or any professional code of conduct? For example, is the TPA an ERPA, EA, ASPPA or NIPA member etc?

From a professional responsibility point view, Circular 230 and the code of conduct for most professional organizations make it pretty clear that you can't perform services to the client based on information you know to be false or incomplete.

You either have a QDRO or you don't. You either have a situation where the plan's written procedure dictates that the participant's rights are restricted or you don't. There should be no gray area here. The written procedures should spell out exactly what has to happen in order for a participant's rights to be restricted. The law balances the rights of both beneficiaries and participants, and that balance should be upheld. This is not an issue where the PA should consider facts and circumstances. Does anyone in this discussion actually have plan procedures that allow for a participants rights to be restricted solely because the PA has been made aware of a possible or pending divorce?

Mobile appears to work fine now. Thanks!

Thats what I was getting at but you beat me to it. Well said Sir.

First time posting from my phone since the new format was rolled out so here we go :) TPA Bob, Is your firms policy the same as the PLANS written policy? Do they match? If not, that could be a big problem. What does "becoming aware" of a divorce mean? Does it have to be in writing? Can it be an office rumor? I'm not trying to be difficult, but when I hear about policies like this I wonder if the PA understands how much responsibility they are taking on in deciding whether to suspend participant rights without anyone even mentioning the word QDRO...

From the facts in the OP, it does not appear that a the plan has received a QDRO. And a divorce does not necessarily mean there will be a QDRO at all. Without a QDRO the PA does not owe a duty to a current participant's soon to be ex-spouse.

It is working great for me on my laptop but the mobile version isn't pulling up the message boards. Everything else seems to be working on the mobile version (for me at least) I like the new look

I just had this conversation with a CPA client of mine, and he wanted something to back up my opinion that it was ok to include the HCE wife with a $0 deferral. Assuming (like your example) that this person is legitimately eligible to participate, a nominal salary with no deferral can be used as a $0 deferral in the ADP test.

Nope. When both employee and employer knows with reasonable certainty that the employee will continue to perform services for the employer, severance of employment has not actually occurred.

You'll NEVER hear me object to it Rule number one, RTFD (Read The F...antastic Document)

Or is correct. You can do it electronically if they meet the integral condition or if they affirmatively consent (opt in). Otherwise you have to do paper. I read ESOP Guys comment as two groups 1) electronic (both integral and opt ins) 2) paper (those who do not meet the integral test and did not opt in)

What My2Cents, ESOP Guy, and David said. It is a combination of 1) No actual definition for "integral" (our opinions are just...opinions) 2) old habits die hard 3) duty to monitor (although you have the same duty with paper if you use regular mail) I know ASPPA/ARA goverment affairs committee has pushed for electronic as a default (opt out rather than opt in) for quite some time, especially since there is no uniform standard within the DOL, or between the DOL and IRS. There has been some resistance at the DOL but who knows what a new administration will bring...

Have you logged in to your online PTIN account, or are you just on the main IRS page for PTINs? I have already renewed and it was an option I had in my online account.

https://www.irs.gov/tax-professionals/enrolled-retirement-plan-agent-frequently-asked-questions FAQ#2

This is a great question. I was one of the drafters of a comment letter on this topic a few years ago. The integral requirement was one of our arguments in favor of a an opt-out default rather than an opt-in default. There are very few jobs left that does not include some level of electronic communication, but there is no clear definition of when it is integral. In my opinion, two way communication is not required for it to be integral. If you are required to read email on a consistent basis, that is enough for it to be integral.

Yes you can use a third party (or should that be fourth if you are the third party?) for withholding, 1099's, etc. We do it in house. Announcement 84-40 provides that a retirement plan trust should (but is not required to) use a separate TIN.

Yes, it is most definitely a withholding issue. Beyond that, the proposed changes to the 5500 is not to start requiring the assets to be held under in an account with a plan EIN, it is to start disclosing what that EIN is on the Form 5500.

If 1/1/17 isn't feasible on your or the clients end I can understand a different solution, but it certainly isn't necessary in order to comply with the law (and in my opinion will make things more complicated than they need to be). For purposes of the safe harbor notice, if a PSP becomes a 401(k), you treat it like a new plan because the participants are treated as newly eligible for the 401(k) portion of the plan. Therefore, if you amend between now and Jan 1, 2017, you are ok as long as the notice is distributed ASAP. You could not do this if you had an existing 401(k) plan. As for the trustee vs participant directed, that amendment is not a prohibited mid year amendment per Notice 2016-16, so you would be able to make that change during the plan year. I still think that is the easy way to go. Amend now to add 401(k) and SH feature as of 1/1/17 Distribute SH Notice with SMM ASAP after the amendment. schedule employee meetings when possible in 2017 amend from trustee to participant directed during 2017

Why not add the SH to the PSP on 1/1/17 and distribute the notice immediately following the amendment that added the SH? As pointed out above, 1/1/17 effective date is not an issue as long as you don't have an existing 401(k) plan. Add the 401(k) and SH features now and you can treat the plan as a "new" plan. Bottom line, you don't need the to wait until sometime in 2017 or 2018 to add the 401(k) feature or the SH feature. You also don't need to have two plans. The simplest solution is to amend now, distribute the SH notice now, and start as a SH plan on 1/1/17.

Great point! Perfect example of the related issues discussed above LOL

Hey! I have an Owners' (k) document :-) LOL The adoption agreement is only 6 pages (a plus), but you are constantly reminding the owner that as soon as you hire another employee AND they become eligible for the plan, then you're required to move to a full document. It IS another thing to monitor in order to prevent an automatic failure upon another employee becoming eligible. It's always good to have it amended to a full fledged document prior to the new employee becoming eligible. BTW, I cannot speak for anyone else, but I enjoy how often we go beyond merely answering the question being asked and offer insight into every related issue as well :-) That has to be worth something. Good Luck! The conversations and tangents are what makes this forum so great. I can easily look something up in the EOB or "who is the Employer", but when I do I am focused on that one thing, so to have someone else bring up a related issue I hadn't considered yet is invaluable As for the Owners (k) document, I wouldn't worry about your clients since you are a professional in this space and I know that you know what to look for and what to look out for. My concern are those people who are tossed a blank solo K adoption agreement from investment firm XYZ... I see the appeal of a super short adoption agreement. We only do one participant plans when a provider we work with needs it as a favor, so in those cases I simply use a full volume submitter and move on.

Belgarath is of course correct. I have seen some financial institutions actually draft their "special solo-k document" to only allow for one participant plans. I always shake my head when I see it since you now add a document failure for what could have been addressed by simply not filing as a one participant plan.