cdavis25

We have a client that filed a 5500 for 2011, since they had over 100 participants. As of 12/31/2011, they fell below the 100 participants. Do they just stop filing the 5500 for 2012 and going forward until they go over 100 participants again?

Tks for the responses everyone. We were looking at the PB Info company as well. Someone else recommended them.

ERISAtoolkit, I did not understand your response. I was thinking the assets and liabilities of Plan B transferred to Plan A on 1/3/12 via the resolution. They have a short Plan year for 2012 (1/1 - 1/3). So, the final 5500 would be due by 8/31/12. Does anyone agree or disagree?

A Plan B was merged into a Plan A with a resolution effective 1/3/2012. The assets were not retitled at the vendor. The assets physically transferred from the old vendor to the new vendor in July 2012. What is the due date of the final 5500 for Plan B?

Now that we can no longer use the IRS forwarding service, does anyone use a good company to search for lost participants? Google does not always work.

Is anyone returning the deferrals or does everyone follow the EPCRS correction and amend the Plan?

Company A sponsors a 401(k) Plan. A division from A goes to form a new Company B on 4/1/2011 and adopts the 401(k) Plan of Company A on 4/1/2011. Company A owns 45% of B, so they are unrelated employers. The 401(k) Plan is a multiple employer Plan. There are a group of employees that go to work for B on 4/1/2011. They are listed as terminated with A on 3/31/2011. An ERISA attorney wrote the resolution/amendments to have B adopt the Plan. They also wrote in that documentation that the historic accounts of the impacted employees maintained under the 401(k) Plan were prospectively associated with B under the 401(k) Plan. So, theses employees did not initiate any transfer or rollover. Code section 416 says you cannot include the account balance from one employer (or controlled group) in the top heavy testing of an unrelated employer's plan. T-32 Q. How are rollovers and plan-to-plan transfers treated in testing whether a plan is top-heavy? A. The rules for handling rollovers and transfers depend upon whether they are unrelated (both initiated by the employee and made from a plan maintained by one employer to a plan maintained by another employer) or related (a rollover or transfer either not initiated by the employee or made to a plan maintained by the same employer). Generally, a rollover or transfer made incident to a merger or consolidation of two or more plans or the division of a single plan into two or more plans will not be treated as being initiated by the employee. The fact that the employer initiated the distribution does not mean that the rollover was not initiated by the employee. For purposes of determining whether two employers are to be treated as the same employer, all employers aggregated under section 414(b), © or (m) are treated as the same employer. In the case of unrelated rollovers and transfers, (1) the plan making the distribution or transfer is to count the distribution as a distribution under section 416(g)(3), and (2) the plan accepting the rollover or transfer is not to consider the rollover or transfer as part of the accrued benefit if such rollover or transfer was accepted after December 31, 1983, but is to consider it as part of the accrued benefit if such rollover or transfer was accepted prior to January 1, 1984. In the case of related rollovers and transfers, the plan making the distribution or transfer is not to count the distribution or transfer under section 416(g)(3) and the plan accepting the rollover or transfer counts the rollover or transfer in the present value of the accrued benefits. Rules for related rollovers and transfers do not depend on whether the rollover or transfer was accepted prior to January 1, 1984. Now, my question is how do you treat the account balances for the affected employees that transferred from A to B for top heavy testing? Do they count in the test for A or B? These companies are unrelated. The money never left the Plan. The employees did not initiate the "transfer" or the "prospectively associated".

I think I am overthinking again, but?? The client uses the Corbel VS docuemnt. In 2000, the eligibility was 21, 1 yos, and dual entry. This is a calendar year Plan. The eligiblity switched to 18, 6 months, and quarterly entry in 2009. John Doe was hired 6/21/2000 and terminated 3/18/2001. He had 1,000 hours in that time span and was over 21. He did not enter the Plan, since he was not there on 7/1/2001. He was rehired 5/20/2011. He did not work from 3/19/2001 - 5/19/2011 for the client. Was he a Participant on his rehire date, 5/20/2011? I believe so, but do not want to miss anything with the rules of parity.

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Tks!

If an employee signs a timely irrevocable waiver for all Plans of the employer, then they are counted in 410(b) coverage testing as not benefiting. They are not counted in the ADP or ACP tests at all. They are counted in the cross testing of the Profit Sharing contribution as a zero EBAR. Is this correct? I have read some conflicting post on here. Tks.

I agree. The vendor told the agent something different and I thought well...maybe I am missing something.

A client terminated their SIMPLE IRA effective 12/31/11. They are starting a 401(k) effective 1/1/12. They have the 2011 matching contribution and last 2011 deferral to deposit yet. Can they deposit this money in January 2012 without violating the exclusive Plan rule?

Client has a last day requirement for match. The last day for 2011 is Saturday. The participant terminated 12/31 per the client. I believe they should receive the match, if they worked on 12/31 or if the client was closed on 12/31. Is that correct?

Nobody wants to touch this?

A client is correcting a loan that exceeded the 50,000 limit and missed some loan repayments due to the fault of the employer. They are correcting it under EPCRS. Now, my question comes with the Form 5330. Do they have two PTs here: one for the loan in excess of 72(p)(2)(A) and one for the late loan repayments? So, the amount they owe is 15% of the loan excess and 15% of the interest on the late repayments?

Can you file a form with the IRS for a determination for a control group? I know you can file the Form 5300 for an ASG determination?

Do you have to give the participant and alternate payee a blackout notice while a DRO is being determined for a QDRO?

I think I found my answer. It is both. The distribution is a nonqualifed distribution. The amount can still be rolled over to the Roth IRA. Box 5 on the 1099R will have the basis in the Roth 401(k) that can be recovered in 2009 and was rolled over to the Roth IRA. Here is another question: Say the basis was $5,000. There was a loss on the account and the balance in the account when rolled over was $4,500. Do you enter $5,000 in box 5 or $4,500 in box 5?

A participant with Roth 401(k) deferrals terminated employment. She was 40 years old and her first deferral was in 2006. She rolled the Roth 401(k) money into a new Roth IRA in 2009. 1) Is this considered a nonqualified distribution, since she was under 59.5? -or- 2) Since she rolled the money over to the Roth IRA, it is still qualified. The 5 year clock would be January 1, 2009, for the new Roth IRA. The code on the 1099R is H. Box one on the 1099R would be the rollover amount. Box 2a on the 1099R would be zero. Box 5 on the 1099R would be zero.

I see they gave small Plans 7 business days to remit deferrals. What is the rule for large Plans? Is it 2 business days or just the vague DOL reg of ASAP but not later then the 15th day of the month following?

I think you are ok. It will count for anyone that is not a participant yet; however, you will need to count their past service towards the 3 months.

My understanding is that you can not change that SH to all mid year. I agree that it seems silly, but I don't think the IRS would allow it. I think you may also have an issue with allocating the PS prior to year end for anyone, since you have the 1000 hours and last day requirement. You are not following the terms of the Plan document by depositing it early.

A 401(k) Plan is made up of four companies that sponsor the Plan. Three of them are in a control group. The other company X is not part of the control group. Company X wants to stop it's participation in the Plan. If they do this, then do the participants from company X have a distributable event? Or, would company X need to spin off into their own Plan and then, terminate that Plan so that the participates have a distributable event?

I have a client that gave me the following information. John Doe is a vendor w-2 paid gross wages. The w-2 for him only had box 16 (State wages, tips, etc.) completed. No other box for wages or taxes withheld was completed. He has a US address on the w-2. Is he considered an employee of the company or is he a vendor that is paid by a w-2?? Can a vendor be paid by w-2?