RatherBeGolfing

I agree that for this plan it isn't much of an issue, but it could impact more than vesting for other plans. If the IRS determines that there has been a complete discontinuance, the plan is treated as terminated. This relates back to the end of the employers tax year following the year of the last substantial contribution. The IRS also points out that they do not consider employee deferrals when looking at recurring and substantial contributions. Is it likely that the IRS will disallow non-substantial contributions or employee deferrals following a complete discontinuance? Probably not, but I think its worth pointing out.

Yep. And its a PITA. Fix prior year first then file the final with the correct EIN.

Im not sure what planet I was on when I read the OP because I missed all the relevant information... For some reason I read the "sign a document" portion of the OP as singing the plan document. Please disregard my prior comment. @Luke Bailey good catch on the disregarded entity. I guess the question then is, can a disregarded entity be part of a CG? Sole props are, but what about single member LLCs? Is there a simple answer?

It should be pointed out that while you dont have to terminate, you do have to have "recurring and substantial" contributions.

It is a controlled group whether they sign the document or not. The reason for adopting the document is to be a participating employer and has no bearing on the controlled group status.

I'm not sure you can do it that way. The underlying plan is still a profit sharing plan even if you don't "allow" profit sharing contributions. You cant have a 401(k) feature without an underlying plan. They would still meet eligibility for the PSP as of 1/1/18. If we take your approach and say that since PS contributions are not "allowed" there is no source to enter for as of 1/1/18, then we couldn't have a retroactive effective date of 1/1/18. You would need an effective date of 10/1/18 with a short first plan year, and you would still have 10 as a BOY participant count.

You are focusing too much on the deferral effective date even though it is only one of several plan features. If the plan effective date is retroactive to 1/1/18 and the employees are eligible and enter 1/1/18 your count is 10.

No question the employer should reimburse the plan for the fee it caused by bouncing the check. The more important question is what happened to the EMPLOYEE assets in the account since they bounced a check of deferrals? Did the employer use employee contributions to cover business expenses?

Correct. We have had a few good threads on it before. The cliffs notes version (2018 calendar year plan): After 9/15 but no later than 10/15 - 2018 for 415 purposes but a 2019 deduction After 10/15 but no later than 12/31 - 2019 for both 415 and deduction After 12/31 - EPCRS puts you back in 2018 for 415 purposes but 2010 deduction (Rev Proc 2019-19 Section 6.02(4)(b), Treas. Reg. 1.415(c)-1(b)(6)(ii)(A))

No one is being judgmental here. If anything, people in this forum (and this thread) tend to look at these things without judgment or emotion. Most of the regulars in here are professionals who work on the plan side of things. We could care less what the reasoning is or motives are, because they do not matter. The only thing that matters is whether you have a DRO that can be qualified. If you do, the AP can get paid from the plan. If you don't, AP can't get paid plan. It doesn't matter what the parties agree to if they didn't verify that the plan can actually execute the agreement. For purposes of the plan fiduciary, the only thing that matters is that the plan act according to its rules and procedures. If Fidelity is making the determination that the DRO is not qualified, they must have more authority than just being the TPA. That aside, are you 100% certain that they are wrong in not qualifying the DRO? If you are asking them to do something they cannot do, the problem is not with Fidelity or the Plan Admin, it is with the limitations put on the DRO by the Judgment of Divorce. Take the emotions out of your argument. Im sure Fidelity would be thrilled to have a QDRO so that they could be done with this as well.

But the Rev Proc is focused on VCP vs, SCP. You can make limited corrections under SCP, anything beyond that scope has to be fixed under VCP. Assuming that you can undo a deemed distribution once the 1099-R has been issued, it would be a corrected 1099-R. There seems to be some agreement that you could do it if the failure and correction happened after the April 19, 2019 date of Rev Proc 2019-19, but before that you are under Rev Proc 2018-52 and VCP is the only available correction. Yes, if it has been corrected there is no failure. If there is no failure there is no deemed distribution. If there is no deemed distribution there is no 1099-R. If you corrected under SCP, your other option is to formally correct under VCP. I don't think any custodian or provider would refuse to file a corrected 1099-R if the failure was corrected under VCP. The rev proc says that corrected deemed distribution is "not required to be reported on Form 1099-R". Could a provider insist on VCP rather than SCP? I think so since the DOL still requires VCP in order to issue a no action letter. I'll flip the question. If the tax reporter issued a 1099-R for a deemed distribution that no longer happened, can it refuse to issue a corrected 1099-R? I don't see how they could refuse. The only thing they could reasonably insist on is the method of correction since (VCP rather than SCP).

The plan admin is tarred and feathered... ...Unless you make the participants whole by allocating lost earnings. EPCRS principles of correction would apply. You do not lose SH status if you correct.

Self correction was not available under Rev Proc 2018-52, you had to go through VCP. Rev Proc 2019-19 allows for self correction of some plan loan failures. If you can't self correct the failure you have to go through VCP. You are right, if you correct the deemed distribution, you do not have to issue the 1099-R. Recordkeepers are playing catch up here though, so I'm sure we will see new procedures. I went back and re-listened to last week's ERISAPedia webcast with Stephen, Ilene, and Derrin. They all agree you cant use self correction under 2019-19 to fix a 2018 1099-R on a deemed loan, you would need to VCP. They seemed at least open to the idea of an amended 1099-R if its for a failure after April 19, 2019. I have also talked to folks who are not comfortable with self correction once the 1099-R has been issued, saying you should VCP.

I don't think they are forming a new entity, it is just that the acquired entity (company B) is "new" to the existing entity (Company A). It sounds like a stock sale with a parent-subsidiary controlled group like Luke said earlier.

@QP_Guy I'm 99% sure that based on the facts as you present them, self correction is not available. You have two issues here. The loan has already been deemed and a 1099-R has been issued. The loan failure has already been addressed by the deemed distribution, so there is no failure to correct anymore. Rev Proc 2019-19 does not explicitly state that you have to correct before the loan is deemed, but everyone I have talked to has agreed that you cannot correct a failure to repay after it has been deemed (and in this case a 1099 has been issued). The failure was addressed before rev proc 2019-19 was issued. Even if you could "undo" a deemed distribution, you could not undo one that happened before the correction was available.

Requested a quote yesterday. Got a call and an emailed quote today. I like what I see so far. Since you are a client already, let me know if they give some incentive for referrals and I'll happily let them know where I got their information.

I have used it and I have never had any issues with it. I don't recall if I have received the "we need more time" notice on a EZ penalty relief filing, but I have received similar ones for other thing and it has always been a time/resource issue with the IRS, they just hadn't gotten to it yet. They can take several weeks to months to process 5558 filings so who knows...

Can you be more specific about what you are looking for? Qualified plans can include language that automatically revoke a beneficiary designation upon a state event, like divorce. The IRS has said that while plans can auto-revoke on divorce, it may be problematic to auto-revoke on legal separation. See Employee Plan News Issue 2013-3 Are you looking for case law that specifically says that a plan CAN auto-revoke? Most cases I have read on it deal with whether something other than the plan is enough, like waiving the right to benefits in the divorce decree without actually changing the beneficiary designation, or a state law that auto-revokes a benefit upon divorce.

Im pretty sure EOB online updates during he year when something significant happens. Its been a while since I spoke to Chuck at ERISApedia, but they price their different research tools separately. So the comparable product to the EOB would probably be their QP eSource. Whos the Employer is also available from them but as a separate product, so I wouldn't call it "included" (but you do get a discount) You could also get Whos the Employer from EP and the EOB from ARA if you wanted to. Not sure what extra steps you take for the EOB, I have the EOB page bookmarked so with my credentials I go straight to the EOB rather than navigating ARA first. I really like EPs prospecting tool. I have played around with it and I think it could be useful. Price wise I think they are pretty similar, but if you get more than one product from EP you get a discount so that would probably be in their favor.

EOB online is user friendly and has A LOT of information. I have looked at ERISApedia but I haven't done a deep dive. At this point I still prefer the EOB. This may change as ERISApedia gets going for a few years, and we can judge if there are any major changes to the EOB now that its with Robert Richter at ARA rather than with Sal.

George also caused a bomb scare because he was trying to nap at work, just sayin...

$750 per year capped at $1,500 for a small plan. The user fee would be the same to correct 2016 and 2017 as 2016 through 2018 (and beyond) if it questioned. I still think that 5500 or 5500-SF is the correct form though.

I agree, but if they are that big much of a big time exec they probably just hand the credential number and pin to someone less big time to do the actual filing. I know they aren't supposed to do that, but I'm sure it happens all the time.

You only file one form, and it should go to the address listed in Rev Proc 2015-32: Internal Revenue Service 1973 North Rulon White Blvd. Ogden, UT 84404-0020

How many filings are are we talking about here? Since OP is only looking for a way to avoid signing each form individually, I assume that the concern is not the time and effort of reviewing each form to make sure they are true, correct, and complete before signing under penalty of perjury. It would have to be a very large number of plans if just signing each one is this big of an issue. I file for my clients and even with the additional steps of we have to go through it doesn't take that long to work through a decent number of filings...