RatherBeGolfing

Comp limit for employees excluded from the calculation of startup cost credit increased to $105,000

And all participants without an affirmative election need to be auto-enrolled. Cant use participants who enter on or after xx/xx/xxxx if you want the extended testing window.

I think a reasonable interpretation is that any level of assistance in a major disaster area will qualify (absent further guidance). I'm comfortable defending that interpretation should they come out with further guidance that limits it.

Lots of answers in this thread.

Absent specific guidance that says "LTPTEs are not subject to auto enrollment", I don't see an argument for why it wouldn't apply. I'll also throw in that at least two sessions at ASPPA Annual made this point I believe one was Kelsey Mayo in a general session but don't quote me on it.

Most auditors I have worked with will make this determination based on facts and circumstances (as they should). I have seen some auditors start with a default position like every company should be able to separate employee contributions from employer assets in 2 business days, and only deviate to longer if it can be substantiated that it is not possible to it in 2 days. Nope, because it is by definition not a valid reason. Anything beyond the 15th of the month following has to be corrected. The regs are very clear on this.

Are these material defects or more like a technicality that still should have caused the designation to be rejected? Did someone forget to dot an "i" or did they turn in a designation without signing it or getting it notarized?

+1 100% leave it alone.

In my opinion, you can't reverse/undo a plan term. You created a right to 100% vesting and a distributable event. What you can do is start another plan. This solves the distributable event issue because there is an alternative DC plan to transfer assets to, and you add new sources for new contributions that will be subject to vesting.

If you are required to file and file late, you either pay the penalty or the DFVCP user fee. The penalty for a small plan is $10 per day capped at $750, for a large plan its $10 per day capped at $2,000. Participants don't matter for the $10 per day, just the cap. For purposes of the calculator, I think you have to "trick" it by entering 1 participant instead of 0. It needs the count to decide if the cap is $750 or $2,000.

Attach the information to the filing, if you still get a love letter from the IRS, follow up with a written response.

I think so. The IRS will identify the sponsor by EIN anyway...

As a Florida based practitioner, I have been through this many times. While then IRS is supposed make the determination based on zipcode, they still sent proposed penalties to many in the disaster area. It has been hit or miss for years. Sometimes the IRS love letters show up before the extended due date, some times they show up after you file. You can send the IRS a flash drive with a list of clients affected by the disaster, but I have found that this doesn't help much. Things that work more often than not: Put the FEMA disaster declaration in the "Special Extension" description. This will be disaster and state specific. For example, DR-2848-FL is the Florida disaster declaration for Helene. Add an "other attachment" to your filing and attach he IRS disaster notice to your return. You won't find this in the instructions or any of the communications, but I have been told by both IRS and DOL staff that this will reduce the chances of an agency follow up. If you are using YOUR location as a reason for the extension, use an "other attachment" to add the explanation that while the client was not in the disaster area, the practioner was, and that is why this client is entitled to the extension. I hope this helps.

Pretty much. Its basically part of overhead.

If they are employees, they count.

I agree.

Depends on the firm. Most places have a set rate in their service agreement for ad hoc services like this. Many places waive fees for things like this in favor of client retention. My guess is that very few TPA have "rates" for different positions. I did when the TPA was connected to a CPA firm, but TPA firms usually do not track billable time like a CPA or law practice.

Its hard to tell when the only ones you hear about are the denials. I have had both denials and approvals in the same batch in prior years. You should be able to get a resolution, but its a time suck.

self-certification appears nowhere in the statutory language, but the IRS included it in FS-2024-19 https://www.irs.gov/newsroom/disaster-relief-frequent-asked-questions-retirement-plans-and-iras-under-the-secure-20-act-of-2022 See Q&A 11 Q11. May a plan sponsor or plan administrator rely on a participant’s reasonable representations that the participant is a qualified individual? A11. A plan sponsor or plan administrator is permitted to rely on a participant’s reasonable representations that the participant is a qualified individual who qualifies for this special treatment for distributions and loans, unless the plan administrator (or other responsible person) with respect to the qualified employer plan has actual knowledge to the contrary.

Thanks @Belgarath!

I appreciate it Craig. Stay dry on the east coast, we are bunkering down here in Tampa.

Thanks @xabana!

Thanks CBZ, I'm leaning towards this as well since I dont see any reference to the type area designation.

Thanks CBZ, this is all I have seen as well, other than a reference to Katrina Relief in Notice 2005-92. Again, I cant put my finger on it but Im pretty sure we were always limited to areas designates for individual assistance. I just happen to have a participant in a county that qualifies for public assistance under TS Debby, but they did not qualify for individual assistance.

@Craig Hoffman I haven't seen any for my clients yet, but I know there were erroneous denials dated 9/16 that have been talked about previously. Edit: We did get a denial dated 9/30/24, but it was for a 8/31 due date. 5558 mailed on 8/23/24.