Trisports

The participant changed their election in 2021 from 3% to 0% but the payroll continued to deduct 3%. The failure was discovered in 2023. The plan has no match and is subject to ADP testing. How should we correct. technically, these were impermissible deductions. Are we supposed to return the contributions + earnings/losses to participant and re-run the ADP testing?

We have an orphan plan (doctor died in 2014, he was the only participant in the profit sharing plan). He did not designate a beneficiary and according to the document, the assets are payable to his estate. Daughter is the executor of the estate (doctor's wife predeceased him) . The assets are with Morgan Stanley (approx. 1.1 mil) - MS will not take instructions from daughter, as executor of the estate, but instead requires a court order appointing a successor trustee of the plan The plan document has not been updated and no form 5500s have been filed so we want to terminate the plan via EPCRS and file the delinquent returns. Do we need to file a court proceeding to appoint a successor trustee? How do you do that for a profit sharing plan? I can't find any instructions on how to appoint a new trustee for a retirement plan.

I think my main issue is: will the IRS take the position that the plan was not a QACA safe harbor because the matching formula did not meet the 401(K)(13) requirements? Because the SH notice listed a match up to 5%, some participants could argue that they would have deferred 6%, in which case we would have a missed deferral opportunity for the deferral part (from 5% to 6%)?

The client thought they were a QACA Safe harbor for several years now – BUT they only matched up to 5% . The formula was 100% up to 3% and then 50% of elective deferrals on the next 2% of compensation. They put in a total of 4% (0.5% more than required for QACA safe harbor) but did not stretch the match up to the required 6%. The vesting was 100% after 2 years of service. Since the client matched more than the required 3.5%, do we need to do anything?

The plan document provides that the plan year end is the last Friday of the December. The plan runs from 12/28/2019 - 12/24/2020 so form 5500 and 8955 were filed on the 2019 Forms. For 12/25/2020 - 12/31/2021 the Form 5500 and 8955 will be filed on the 2020 Forms. My biggest concern is that 2021 form 5500 and 8955 would then be skipped because there is no plan year that starts in 2021. The next plan year is 1/1/2022-12/30/2022. Due to the fact that the plan year starts in 2022 then the form 5500 and 8955 should be filed on the 2022 forms not the 2021 year. Another issue is that the year after would also be reported on the 2022 form 5500 and 8955 because the plan year is from 12/31/2022 – 12/29/2023. Any suggestions on how to handle this situation?

We are filing an anonymous VCP. What should we use for plan sponsor, plan name, plan number and EIN on pay.gov? We will redact the plan information in the attachments but what do we use for the online 8950 Form?

Our client (ABC bank) is sponsoring a pension plan with 85 participants. ABC bank also holds the investments and some of the assets are invested in the ABC money market fund. The auditor stated that because the ABC bank holds the investments (they are the trustee and custodian), the plan is required to be audited. More than 95% of the assets are qualified assets and there are less than 100 participants so we think the audit waiver requirements are met. The fact that the plan sponsor is also the custodian might be a potential fiduciary issue (prudent rule) but that should not preclude the plan sponsor from waiving the audit requirement. Do you agree or is the client required to have an audit?

Thank you all. The plan is subject to ERISA. The plan sponsor (501c entity) made matching contributions contributions since inception. The plan was never formally adopted and no ACP testing was done. We are basically handling all the compliance issues since inception - VCP for plan doc & other issues and DFVC for late Form 5500s.

We took on a client - 403(b) plan - that never filed Form 5500. The plan was in existence since 2004. We are filing the late returns under the DFVC program. Since 5500-SF is not available for years prior to 2009, is it ok to file Form 5500 from 2004-2008 and Form 5500-SF for 2009-2019 or should we use the same Form for all open years? Thank you.

Our client is a controlled group who acquired a new entity last year. The client determined they can operate the new entity as a QSLOB. Who should be listed on the Form 5310-A as "the employer""? The parent company or the new entity?

We were asked to assist a client who had a 403(b) plan since 2004 but never formally adopted a plan document or filed a Form 5500. If the client adopts the plan document before the June 30 deadline, are we in compliance, or do we need to file a VCP for the plan document issue? Is the June 30 deadline only for defects to an existing plan document or can we use it for a plan that never had a plan document? For the late 5500, the client will filed under DFVCP. Thank you.

I believe the only way you can talk to the IRS is if you are an ERPA - enrolled agent with the IRS - unless, you are an attorney.

A new health and welfare plan was established in 2016 and had less than 100 participants in 2016 and 2017 so no Form 5500 was filed. For the 2018 plan year, we were incorrectly told by the client that the number of participants at the beginning of the year was 145 so we filed an extension before July 31 indicating this is the first extension for the plan. Upon additional review, the client confirmed there were only 20 participants at the beginning of 2018 , therefore a 5500 report is not required. Do we need to do anything to notify the IRS to disregard the extension? Will we get any inquiry from the DOL about a potential filing? Now that we filed an extension, do they expect to receive a 5500? Thanks.

Are you referring to the VCP User fee? If yes, you are correct, it cannot be paid from the plan assets. The Internal Revenue Manual section on EPCRS expressly provides that VCP user fees are not payable from plan assets. See below: IRM 7.2.2.7 (10-03-2017) VCP Submissions - Initial Review Verify that the user fee has not been paid with plan assets: Review the cover letter or narrative in the VCP case file to determine if there is an indication that the user fee was paid by the plan. Review the HQEP printout and copy of user fee check to see if the plan is the payor of the user fee. If the copy of the check is missing, secure a copy of the compliance fee check from the VCP Applicant. If there are indications that the plan paid the compliance fee, discuss the matter with the Group Manager or Group Coordinator. If the fee was paid by the plan, ensure that the plan is immediately reimbursed by the plan sponsor (or some other party) with interest for any amount of VCP compliance fees paid. The VCP submission cannot be processed any further until the plan has been reimbursed.

Traditional DB plan, several participants were supposed to be put in pay status at age 65 but the prior record-keeper failed to initiate the payments. We are now calculating retroactive annuity payments; however, the plan does not know the participant's marital status. Some participants cannot be located and some won't respond. On what basis should we calculate the annuity if we don't know their marital status? Single? Married? If married, what age should we use for spouse? The plan document is silent and I cannot find any guidance on whether there is a default method to use when calculating the annuity. Thank you.