RatherBeGolfing

Absolutely, but VCP for a simple loan fix just adds to the VCP backup.

Looks like we still need to keep the pressure on the DOL...

Rev. Proc. 2019-19

Expanded Self Correction Program - EPCRS Rev. Proc. 2019-19 Only glanced at it, but early Christmas on Easter from the IRS??

§ 2520.104b-10(a) ...shall furnish annually to each participant of such plan and to each beneficiary receiving benefits under such plan... If there is no balance, there is no participant or beneficiary. I don't have a copy of the 5500 preparer's manual anymore, but I know that one of the prior editions said that there was no SAR requirement for a terminee who was paid before the end of the plan year. 12/31/2018 plan year Participant paid out 12/30/18 - no 2018 SAR required(12/31/18 is a toss up for me) Participant paid out 1/1/2019 - 2018 SAR required.

Derrin has also written on the topic in "Who's the Employer" Q&A 100: Illegal Aliens As Employees Q&A 205: Illegal Aliens and the Supreme Court

I think this is rare unless the CPA is also doing the qualified plan. Its usually a back and forth between the CPA and the person doing the benefit calculation. They lean on us pretty heavily when the partners and sole props are pushing for their returns. Some CPAs are more in tune than others and know what we need each year, while we have to drag it out of others line by line. Far too many accountants/CPAs don't even have a firm grasp of what compensation can actually be used for plan purposes to begin with, which is scary enough on its own.

Id say early 2000's since it talks about what is new since EGTRRA became effective. Some of the examples use the 25% and this one uses the 15% so it was probably an old example that wasn't updated. They are inconsistent, but Pub 560 also feels incomplete. It talks about all employees in one section, and then completely ignores other employees in the next. There should be some kind of mention or caution in this section regarding what happens to those other employees. With all the plan audits out there, I would think that there would be more discussion about this if it really was that controversial.

I deal mostly with DC, so unless there are additional rules that apply to DB, I agree with ABC. Why the need to restate D though? It would be completely paid out before the end of the RAP, so it would need to be updated but not restated.

Based on that language an extra $20 a week does not sound unreasonable to me.

Check the loan policy/procedures for prepayment language. Some say no prepayment, some say only full prepayment, some say partial prepayment allowed.

I can see the merit of both arguments, but I don't think you can prove or disprove either argument based on the sources in this discussion. I have sat through many presentations and the like on earned income and contributions, and I can't remember any of them arguing for the limited position. I did find some old IRS EP training material on deductions that is somewhat interesting. Full Document The relevant section can be found on page 29. In example 2, the reference to the allocation is simply "according to the plans allocation formula". I would expect some kind of caution or mention of limiting the allocation to the sole proprietor if that was the position of the IRS.

Its up to the client, but I would still recommend filing VFCP. My view on this is pretty simple. If the amount involved and the excise tax is so low that its an argument for not going through VFCP, the failures are usually so isolated and simple that it inst going to be that difficult or time consuming to go through VFCP. If it isn't simple and isolated, then you are probably talking about many failures with very small amounts. If you have that many failures, your focus shouldn't be the small amounts involved.

The EOB section above (Ch 7 - Section XVI - Part H - Item 1) is not the only relevant discussion in Chapter 7. I think Item 11 of that same Part H gives a better analysis.

The argument is that without an enforceable agreement to repay the loan, the participant can cease loan payments for any reason. If the participant is not required to make loan payments, it is no longer a loan, it is a distribution. If the participant is not eligible for a distribution, there has been a failure to follow plan terms which is a problem for the plan. The counter argument is that simply defaulting on the loan, even if it is at the request of the participant, does not invalidate the the original loan transaction. That said, it would still be a distribution rather than a loan if the participant never intended to pay back the loan.

I assume it would be a great outcome, especially if you submit many simple matters :)

Wishful thinking, but pre-sorting cases before assigning them could lead to complex matters ending up in pile A (requires more experienced personnel to review and takes more time) and simple matters in pile B (less time)

Do you see any correlation between the complexity of the submission and the response time?

If the document does not have a deemed cash-out provision, an argument can be made for 3 above (or 6 c on the form 5500). This is what Janice said on it in the 5500 manual a few years ago.

Of course. You want your audit to tell you where/what the problems are, not just that there are problems. lets say that an audit is supposed to make sure a big report is free of errors and misstatements. Some things have so many details that it is either impossible to go line by line, or it would be incredible inefficient and cost prohibitive. Instead, you use audit sampling to draw a reasonable conclusion. If you find problems in your sample, you get a bigger sample and continue to dig until you find all problems or are reasonably sure that you have found all errors. If you don't find problems in your sample, you can draw a reasonable conclusion from the sample. This all assumes that audit sampling is appropriate for the objective and that the auditor follows proper protocol that includes risk tolerance and all that fun stuff. For example, I wouldn't just check 10 participants and say they are all good so I can conclude that all participant received their contributions.

Yea you are right, if the plan has a deemed cash out provision, a nonvested participant is deemed to have received a distribution as of the termination date Edit: In my document it is in the forfeiture section "For purposes of this Section, if the value of a Participant's vested Account balance is zero upon Termination, the Participant shall be deemed to have received a distribution of such vested Account"

I could be wrong but I thought they counted until forfeited...

Correct. A 0% vested participant is included in the count for 5(b) and 5(c) until the non-vested balance is forfeited.

at a very basic level, you set sample parameters so that that you can expect your sample to be representative of the population. If the sample is representative of the population, you would have a reasonable basis for a conclusion.

Yes. Yes.