RatherBeGolfing

I sure hope so...

Yea we were caught off guard by it as well...

Impossible. That would mean that Lorena filed with Marty's super secret pin...

Me too! @Jakyasar I agree with David (and Derrin) on the compensation issue. I would use $22,000. Its worth pointing out that there is no formal guidance on losses in a related business, so the question should be "is this approach reasonable?"

I think you hit many of important questions here. I agree that it would be income rather than compensation, so it will not affect plan compensation or payroll taxes It makes sense to tax in the year of contribution rather than the year of allocation. Otherwise you could run into issues where the contribution is decided on months after a participant files his or her taxes for the year of allocation. Plan assets for withholding... probably limited to instances where the participant is otherwise eligible to take an in-service distribution to prevent leakage.

No permanency issue with merging new plan into existing plan. The new plan "continues" in the existing plan because of the merger.

I have seen a few people raise the question. I don't see why FICA would apply since it is a payroll tax. Match and nonelective contributions as Roth is more like a Roth conversion. Its a pre-tax contribution from the employer that the employee elects to treat as Roth. The employee has to include the amount as income, but it isn't compensation.

Retirement is one of the few areas where there is some bipartisan agreement. Also, who wants to be the one to tell their higher income voters that they cant make catch-up contributions? The rank and file voters won't care since very few earn enough to worry about catch-ups anyway. I think that a technical correction here is about as much of a given as it can be in DC.

Agreed. That's why I try to stay ahead of it when invited

ROTH only for those making [pick a number at random] coming in SECURE 3.0. But don't worry about plans terminating, it will also include a plan mandate for employers with [pick a number any number] employees. kidding aside, I'm 99% sure we will see this in the next 10 years.

In my experience, checking the box on the 5500 does not guarantee an invite. That said, I recommend accepting the invitation if you get one. I'm usually in the minority on this one, but I have found the DOL to be easier to work with than the IRS if you are forthcoming and cooperative.

Can you expand on your reasoning as to why it shouldn't be legal for plan documents?

Alternatively, one could create this using publicly available records, perhaps limited to those sections that are likely to impact one's business (I doubt most of us will bother with the tax court provisions for example)

I haven't seen one, but it would be VERY helpful to have a redline type document of affected sections.

And remember, there is no IRS model notice, this is basically good faith compliance. I highly doubt that the IRS will come after anyone following their document providers guidance on this issue, whether that is in the year adopted or the year after adoption.

Confirm with document provider. I have heard some providers say 2022, and others say 2023. Mine is firm that it is 2022.

There are clients with 30 employees who would screw up auto enrollment, I don't think its a size issue. I have had auto enroll clients with more than 1,000 employees and lots of turnover handle them just fine, with an issue here or there. And you know, if you need cash to pay for the ambulance for that hangnail, we have a provision for that in Secure 2.0 as well

I dont think you can carve the LTPTs out the way you describe. I also don't think it will be that big of an issue for the vast majority of plans, so amendments to keep them out will be rare. The biggest issue is if you have enough of LTPTs that you have to count as participants for 5500 purposes, you may become a large filer.

I mostly agree with you, other than fundamentally broken and unfixable. Call me an optimist, but it is entirely possible to provide fully compliant plans at a competitive cost, even if the industry as a whole has widespread noncompliance. I stress simple design for simple goals, do not overcomplicate things. As for mandatory contributions, I think that is where we are ultimately heading, but it will be both EE and ER. I think we will see mandatory plans with mandatory contributions in the next decade.

Ill retire somewhere around Cycle 10 restatements...

I think there is some truth to that. But I also think that it was inevitable when you look at what the politicians want to accomplish with their policy changes. is there an alternative?

I actually really like more than a few of the provisions in S2.0. Implementation is going to be a nightmare for many of these provisions though. I started having the " whoa there cowboy, while the law allows for it, there are lots of moving parts and we need guidance before we can..." conversations on 12/29/2022...

We are missing information, that's for sure. The problem with SDBA as a TPA is that you have to rely on a trustee or sometimes participant to act.

Derrins first post-passing S2.0 webinar is later today, will be interesting to hear what he says. Personally, I think we will need IRS guidance to clear up how this section will work in practice.

This is the only reasonable way this provision can work. If left completely to Employer discretion, the Employees will get stuck with the tax liability without having a say. That said, I think you can reasonably read the amended language as simply allowing match and NEC as contributions that may be made as Roth, without the election wording from the first part of the sentence.