RatherBeGolfing

Where does you current understanding come from? The 5500 will have small changes from year to year but the proposed overhaul went nowhere, it simply wasnt a priority item. The IRS tried to add compliance questions to the existing form after the proposed changes stalled, and even that went nowhere.

Aaaaaaaaaaand that is why I don't eat pumpkin ?

The proposed changes have were put on ice. There are other priorities and no funding has been allocated to take on major Form 5500 changes. If and when such funding actually happens, we can probably expect an implementation date of at least 2 years further down the road. Don't expect major changes anytime soon.

I think RESA would let you adopt a new plan as late as the extended tax return due date with a 4% SH, so I would assume an existing plan could amend to add safe harbor at the same time. Did the house bill limit it to amending existing plans or would you be able to adopt a new plan after the end of the year? From what I understand they will be pushing hard on RESA because it is legacy legislation for Hatch but who knows what the next week will bring

Thanks all! Termination notices went out to SIMPLE IRA participants today.

Perfect! That was the solution I wanted but it almost sounded to simple to work :)

Prospective client started SIMPLE IRA in early 2018, but wants to start a 401(k) plan for 2019. The problem we are faced with is the 2 year rule for distributions from the SIMPLE. Can they start the 401(k) for 2019, cease contributions to the SIMPLE as of 12/31/2018, and just not terminate it until the 2 year clock has run on the contributions to the SIMPLE?

Yea I would take issue with this. Looking past the discrimination issue, how is this fee structure reasonable? I would be worried about potential litigation.

But the TPA is not a group or association of employers, it is just an employer. If you had a TPA association, you could sponsor a MEP for TPAs. If you had an Alaska Chamber of commerce, you could sponsor a MEP for members of that chamber of commerce. Region is a commonality of interest under the reg, but the region has to be the commonality for the group or association. Being a service provider and having only regional clients is not a group or association of employers.

The quoted section is only one of the requirements. You still need to be a group or association with a commonality of interest. For example, location could be a commonality of interest, so a local chamber of commerce could sponsor a MEP under the proposed regs. Trade/industry/profession is commonality of interest, so an association like ASPPA could sponsor a MEP under the proposed regs. The concept of Pooled Employer Plans where all you need is one employer sponsoring the MEP and agreeing to be the Pooled Plan Provider is not considered in the proposed regs since the proposed regs have to follow existing legislation. The are basically just expanding the concept of commonality of interest. Since the TPA is not a group or association of employers, its a non starter under the proposed regs.

No. The TPA would not be a bona fide "group or association of employers". The proposed reg does not cover open MEPs or PEPs

Many of my pooled plans treat loans as an pooled investment rather than a directed investment. Its certainly not rare, but overall it is less common.

If they dont like it, then no loans from the plan. Now that would be heaven... Less than prime +1 would probably be an issue on audit. At least they would would ask you to justify the rate, and "the client wanted it" wont cut it. *EDIT loans not land...

Most AAs can accommodate "other" exclusions Plan A excludes M-Z Plan B excludes A-L You can split any way that is reasonable, but this way has less opportunity for participants moving from plan to plan.

Tom is correct. It's an EZ.

I don't think its idyllic to know your limitations and stay within them. Rather than getting into something that is beyond your scope (and a potential minefield for both you and the client), why not play to your strengths and find a solution that you know you can handle and handle well? I seriously doubt that the RK savings of a 2 plan MEP will be so significant that other solutions can't be considered. Take Larry's example of splitting the plan to avoid audits for example. If additional cost is a concern because you are creating another plan, you can probably drop your fees to stay competitive (after all, the two plans are mirrors of each other).

Honest question, if you can't answer basic MEP questions, should you even consider creating a MEP situation for this client?

My understanding is that assessed IRS penalties can still be abated using DFVCP. For an EZ, you are ineligible for the EZ late filer penalty relief program once the IRS has assessed/charged a penalty (CP 283). While you are ineligible for the penalty relief program, you can still request relief for reasonable cause, like we would do before the program.

Yep, I know a very successful TPA firm where the consultants "workload" would seem ridiculous by plan numbers, but all the small steps are handled by support staff so that the consultants are more in a review and finalize position

Great!

I agree with Belgarath, the number of plans you do is close to meaningless without context. I usually do somewhere around 50 plans, but admin is probably about 50% of my responsibilities. I also have outside obligations like committees, government affairs, etc. that takes up some of my office time. Obviously, some plans take a lot more time than others. Some plans I could do 4 in one day, others will take weeks due to the complexity and corrections. I have TPA friends who are pretty streamlined, where there are not that many differences from plan to plan, and the case load for their folks are north of 100 plans. The only number that matters is how many plans you can do at a reasonable pace with a minimal tolerance for error. If someone can handle 120 plans with limited errors without working them to a point of burning out, then 120 might be reasonable if justified by compensation.

True. But also keep in mind that the class exemption for the penalty tax is limited to one transaction every three years, so its not something you can use all the time or even possibly even for multiple payrolls in the same year. If OPs two transactions are close together and the same circumstances caused them both to be late, they could be considered one transaction, but otherwise only one would qualify.

Right, but they don't start by assessing a penalty, they send a notice with a proposed penalty which gives you plenty of time to use the program.

Different levels of compensation and or different allocations of partner expenses?

You wouldn't file VCP for a late deferral, but you would (or should) file VFCP