RatherBeGolfing

Ok then it should be pretty straightforward. All the platform vendors we have clients with send us information type emails all the time. Same with our software vendors. Every now and then, these include free webcasts that you can register for. It might depend on who in your organization is set up as the contact with the vendor, but anyone in your org should be able to register for the webcast. For example, Voya sends out their emails as part of their TPA support. Their webcasts fall under "Voya Financial TPA NAtional Webinar" JH sends theirs out through the TPA Essentials program. Do you get these type of emails from them?

I think the CPC study guide oversimplifies the issue. Generally, a nonperiodic distribution is subject to the 10% withholding rule because it is taxed in the year of distribution. This is not necessarily the case with with a 402(g) corrective distribution. The 1099-R instructions clearly state that "Corrective distributions of excess deferrals are not subject to federal income tax withholding or social security and Medicare taxes." Presumably, this is because the distribution is taxable in the year of the contribution rather than distribution, as long as it is distributed by April 15 of the year following the contribution.

What part of the industry are you in? TPA? Investments? CPA?

Yes. You don't get a pass on the Form 5500 compliance questions just because you don't file VFCP. The only magic number that makes you less likely to have the DOL take an extra look is $0. However, some regional offices are more likely to take an extra look and send a love letter if they see late deferrals on the 5500 with no VFCP. I have heard that Philly, Kansas City, and San Fran are the regions that are the most likely to follow up.

Short answer, yes they are included. Edit: Longer answer IRC §1372 - for purposes of fringe benefits, 2% S Corp SH is treated as a partner of a partnership. IRC §106 - Employee gets to exclude employer provided health coverage form gross income. Since the 2%SH is NOT an employee (partner per §1372 above), the 2%SH does not get to exclude it from gross income. Employer provided health coverage is included in W-2 Box 1, but not Box 3 or Box 5. Premiums should be listed in Box 14 (but I have seen a lot of preparers not list it). For some reason I think auto is included in Box 3 and Box 5 as well, but not 100% sure and I don't think it matters for our purposes. as @ERISAAPPLE points out, make sure fringe benefits are not excluded in the definition of comp.

TPA? Just curious as most TPAs I know pretty much always use the calculator, while all the atty's I know never use the calculator unless VFCP (and they almost always file VFCP).

Yes, they are not subject to withholding. I believe the instructions for 1099-R states it as well.

Enrolled Agent CE do not necessarily count for ERPA CE. It depends on the subject matter and focus of the CE. I confirmed the above with the IRS a few months ago when I researched low cost alternatives for CE. There are a ton of low cost EA CE, whereas ERPA CE is more limited due to the limited number of practitioners. For example, an EA CE class or webinar focusing on federal tax law unrelated to retirement plans, would most likely not get credit if the IRS were to audit your CE. Ethics for EAs and ERPA focuses mostly on Circular 230, so you should be safe with EA ethics as long as the topics can be applied to ERPA type situations. If its ethics regarding how to prepare a 1040, you should probably not rely on it for ERPA ethics CE. You can roll the dice on whether your CE gets audited, and you might be able to convince them to count the credits on a case by case basis, but I wouldn't risk my ERPA since I don't know if you can get re-activated now that the program is closed. I get all the CE I need from conferences, but I also stack up on free/cheap credits during the year so Im always well over the required minimum. I can normally get at least 10-12 hours for free from vendors during the year. On my calendar for the next couple of months: 2 free ethics credits from ERISApedia 1 free credit from Voya 2 free credits from JH 2 free credits from FT Williams / Wolters Kluwer Several of the vendor webcasts do not require that you have a business relationship with them, you just have to do some digging to find them if you don't get their partner emails.

How far can a participant push it? All the way! It is a very bad idea to ignore the participants directions. We had a pretty detailed discussion about it last year

Absolutely get a copy of the SPD. Even though I don't doubt what they told you is correct (but uncommon), you should always know what your rights and responsibilities are. Keep us posted.

I have seen a lot of pre-approved plans with the option of requiring a 1 year break in service, which could make a 2017 terminee eligible for a distribution after 12/31/2018. Or something like the last day of the year following termination...

@MarkGAllen just curious, do you make your own investment decisions in the plan?

Yes. It is less common nowadays with daily valued plans, but plans that are only valued once a year (usually the last day of the plan year) often restrict distributions until after a certain time has passed. The reasoning is that you are owed earnings for 2017 which would be calculated as of the last day of the plan year (lets say December 31). That calculation is done sometime 2018. the deposit of any 2017 contributions could be made as late as September 2018 if it is a calendar year plan.

I agree that if you allocate every payroll when your document says allocate annually you could have an issue, but if we are talking about a 3% SHNE as the OP states, it shouldn't matter. If it were a match and you allocate on a payroll basis, the difference could be significant. That said, there is a difference between allocate and deposit. Many plans allocate on an annual basis, but deposit on a payroll basis with a true-up at the end of the year. Its more of a cash flow management issue. The FTW compliance / admin module has a true-up feature that will calculate it for you. I don't think a mistake that misses someone here and there, which is later fixed, is a big problem. But if you only make the 3% deposit each payroll for the people who defer, and once a year for those who don't, you would have a problem.

We use it most of the time, even if we don't do VFCP. It is a calculated risk scenario. If you use the calculator but don't file VFCP, you run the risk of the DOL "disallowing" the correction if they ever look at it. For small corrections, the DOL will most likely not care (although they are getting really picky in some regions), and even if they do the cost of re-doing it will be fairly small.

Under the expanded PBGC program, unresponsive participants in a terminating DC plan count as missing.

Pooled plan? Treat the distribution as distributed to the participant and a contribution to the plan.

Ive had this happen a few times. Once the IRS, in its infinite wisdom, decided to change the EIN of the sponsor for no apparent reason. Another time, they changed a plan number from 003 to 001 because they thought that it should be 001, even though plans 001 and 002 had been properly terminated 10+ years ago. I think I had the late filing with a penalty once before as well, and was able to take care of it with a 2848 and a call to the IRS. Im sure you can get it taken care of, but it is aggravating, especially if you have to sit on hold for an hour to talk to someone and then go through the new IRS POA screening procedure where they basically ask you for your first born in order to talk to you

I don't doubt that the folks at the IRS could be spending their time doing more important things than looking at loans and RMDs. In my opinion, this just makes our case for self correction stronger.

IRS response to ARA comment letter on VCP User Fees

You are wrong, plain and simple. This is why amendments have to be drafted very carefully in order to avoid unintended consequences.

No. The excess should be distributed to the participant. You cant leave it in the plan. Edit: I just re-read the comment. If this was an Employer contribution that was mistakenly deposited as a deferral, then yes, you could tell AF to make a transfer to the correct source.

Yep

Yes. She would get a 2017 SH contribution. I guess the amount would depend on whether the plan uses participation comp or full year comp. Yes. For 5500 purposes she is a participant at the end of the year because she has a balance. However, she is not an active participant for 5500 purposes since she is now ineligible. Yes. She is an ineligible participant with no balance at the end of the year. She is not a participant for 5500 purposes.

@BG5150 We discussed this here after the 2016 ASPPA Annual where when Brians presentation on 411d6 caused a bit of a stir. You do not have a cutback issue If someone who is currently eligible becomes ineligible because of a change in eligibility requirements. You may have discrimination issues if your amendment favors HCEs, but you don't have to protect someones status as eligible if the change is otherwise permissible. I don't have time to look it up at the moment but this was my citation in the EOB in last years thread