RatherBeGolfing

Matt, that is what TPA software is for and a good reason why plans should be serviced by plan professionals.

At a minimum, you have to track deposits, account for the earnings (per conteibution type) and, and make sure all transactions in the plan were allowable. While I suggest this be done someone with 401k experience, it doesn't have to be cost prohibitive. My firm does these by the hour (400 minimum) and they rarely go beyond the minimun unless its a "problem client". If that isnt in a clients budget they should probably consider another vehicle for savings...

I don't disagree with ETA. However, when the IRS gets a late return, their first correspondence is often "your form is late and based on the # of days the penalty is $15k." That letter also contains information on how to go through the DFVC with a small user fee rather than the 15k. In this case, the return was filed on an EZ so they obvously would not include the DFVC info, and based on the year (2013) Im not sure if its eligible for the EZ program. In any event, it should be taken seriously and requires immediate attention.

Get a POA and contact the IRS, I have no doubt they will work with you to get it corrected. You will be able to do DFVC because you still haven't filed the 5500-SF for 2013.

A few things don't add up here... If they filed $0 BB and 0 participants beginning of rhe year for 2013, shouldn't 2012 have been your final year? The 2013 filing, EZ or SF does not make sense. You can do DFVC even if you already filed the 5500. What you cannot do is DFVC with an EZ (there is another program for that)

I believe the FAB you are referring to is 2012-02R. See Q39 below Q39: A plan offers an investment platform that includes a brokerage window, self-directed brokerage account, or similar plan arrangement. The fiduciary did not designate any of the funds on the platform or available through the brokerage window, self-directed brokerage account, or similar plan arrangement as "designated investment alternatives" under the plan. Is the platform or the brokerage window, self-directed brokerage account, or similar plan arrangement a designated investment alternative for purposes of the regulation? A39. No. Whether an investment alternative is a "designated investment alternative" (DIA) for purposes of the regulation depends on whether it is specifically identified as available under the plan. The regulation does not require that a plan have a particular number of DIAs, and nothing in this Bulletin prohibits the use of a platform or a brokerage window, self-directed brokerage account, or similar plan arrangement in an individual account plan. The Bulletin also does not change the 404© regulation or the requirements for relief from fiduciary liability under section 404© of ERISA or address the application of ERISA's general fiduciary requirements to SEPs or SIMPLE IRA plans. Nonetheless, in the case of a 401(k) or other individual account plan covered under the regulation, a plan fiduciary's failure to designate investment alternatives, for example, to avoid investment disclosures under the regulation, raises questions under ERISA section 404(a)'s general statutory fiduciary duties of prudence and loyalty. Also, fiduciaries of such plans with platforms or brokerage windows, self-directed brokerage accounts, or similar plan arrangements that enable participants and beneficiaries to select investments beyond those designated by the plan are still bound by ERISA section 404(a)'s statutory duties of prudence and loyalty to participants and beneficiaries who use the platform or the brokerage window, self-directed brokerage account, or similar plan arrangement, including taking into account the nature and quality of services provided in connection with the platform or the brokerage window, self-directed brokerage account, or similar plan arrangement. The Department understands plan fiduciaries and service providers may have questions regarding the situations in which fiduciaries may have duties under ERISA's general fiduciary standards apart from those in the regulation. The Department intends to engage in discussions with interested parties to help determine how best to assure compliance with these duties in a practical and cost effective manner, including, if appropriate, through amendments of relevant regulatory provisions.

It's just crazy that there is no self correction option, even for small amounts. Frankly I thin there should be a self correction option for deposits that are late by less than a month for example regardless of size. Maybe they will figure that out! I agree. To that end, there is a possibility for something good to come out of it since they are collecting data on how people are using the program.

So here is a brief update Yes, this is part of a national initiative, but how it is addressed depends on the regional office. There is no de minimis amount. It appears that this could also be connected to an even larger initiative looking into how effective current compliance programs are and how they are used. J

Like Kevin said its not logical but it is how the rule works. That third loan throws a curve-ball into the highest outstanding & current outstanding equation. Most of my plans only allow for one loan at a time so this is more of a theoretical exercise for me

Yep, this is how it would be handled if it landed on my desk as well. Although, most auditors I work with are very reasonable as well and would probably offer to pay half of it in a situation like this.

But they told me they were a FIDUCIARY!!! You mean I actually had to read the fine print and maybe look up Awesomefiduciarytrainingforoutofworkrealestateagents.com who issued the fiduciary "certificate"?!

If the user lacks expert knowledge of ESOPs, it should probably be passed on to a user who DOES have said knowledge All kidding aside, this type of question always makes me a bit uneasy. If you don't understand the mechanics behind the questionnaire/input system, you probably shouldn't use it to create a plan.

I have had the same requests but I always just provide the SPD and they are fine with that.

Austin, how does the opportunity to exploit the hole in the regs apply to one and not the other? I agree, the example ETA brought up is more extreme than the example in the EOB, but I just don't see that there is anything in the statute to suggest a limited opportunity to use the loophole. The EOB also states that Treasury could (but have not) seek an interpretation that would preclude loaning out more than $50,000 in any 12 month period when there are more than two loans. Without such guidance, the loophole is still available.

I'm fairly certain that ETA is correct that a literal reading of 72(p) actually allows for this. This is because the statute does not specifically state that you have to carry over your adjusted limit in the second loan to the third loan. From the EOB Applying the $50,000 limit when there are more than two loans in a 12-month period. Where there has been more than two loans in the last 12 months, remember to take the highest outstanding loan balance at any time in the 12-month period, and subtract the current loan balance at the time of the new loan to determine the adjusted maximum loan limit. As the following example illustrates, it is possible to lend out more than $50,000 in a 12-month period provided the outstanding loan balance at any time is not greater than the adjusted maximum dollar limit.

Having been through this before, here are my observations Attaching a statement explaining that the audit is not available lets you submit "on time", but incomplete In my experience, the DOL will NOT consider the incomplete filing timely. Attachments are reviewed to before they are made publicly available When reviewed, your filing will most likely be flagged as incomplete, and you will get a love letter telling you that you are on the naughty list and can be subject to huge penalties, but if you pay the user fee and file under DFVC in XX days you are back on the nice list. If you don't file on time because you are waiting on the audit, you will pay the same user fee but won't subject yourself to the the DOL/IRS follow up timeline. If this was my client, I would hold off on filing until I had the audit and could file late but complete and go through DFVC right away.

Nothing yet...

There is similar relief for Florida *EDIT The relief I mentioned was for Hurricane Hermine and covered Citrus, Dixie, Hernando, Hillsborough, Leon, Levy, Pasco and Pinellas counties. With the damage in St Johns and Volusia, Matthew relief has to be coming...

Another vote for get an attorney. I know you said you can't afford one, but this is one of those cases where you really have no choice, you need legal representation. Many attorneys will give you a free initial consultation, at the very least you should take advantage of that and see what they say.

Fair point, but as long as the excluded class is reasonable it shouldn't be a problem. Obviously, you wouldn't define the excluded class as "non-citizens" or "French Canadian", but if you can put them in a class that meets bona fide businnes criteria or job classification it is not an issue. We don't know the setting here, but using "visiting professor" rather than "J-Visa Employee" should do the trick. In order to do that, you cannot have a problem with excluding "visiting professors" who are US citizens (assuming that excluding visiting professors would succeed in excluding the entire group of people you wanted to exclude). I agree,it was just an example of non-discriminatory wording.

Fair point, but as long as the excluded class is reasonable it shouldn't be a problem. Obviously, you wouldn't define the excluded class as "non-citizens" or "French Canadian", but if you can put them in a class that meets bona fide businnes criteria or job classification it is not an issue. We don't know the setting here, but using "visiting professor" rather than "J-Visa Employee" should do the trick.

If you have the numbers I don't see why that would be a problem.

Glad to hear you are ok Tom. It was sad to see the images of St Augustine turning into a river last night so I imagine it must have been pretty bad in Jax as well.

Im on the DOL committee for ASPPA GAC, I have forwarded this issue to my group to see if is regional and luck of the draw or if it is part of a bigger enforcement initiative. I will let you guys know what I find out. J

I am assuming (which is never a good thing) that these used the DOL calculator to figure out the lost earnings but did not file VFCP. I know the Philly office has done this before. Their position is that you are not allowed to use the calculator unless you file VFCP. If you use it and correct outside VFCP, they may not consider it corrected. They may be trying to bring this issue back up though other regional offices ugh