CuseFan

I don't think you are precluded from doing so but remember your transferred excess assets are required to be allocated (reasonably) ratably over 7 years or less.

The 5-year rule language is the standard/generic RMD provision, but a DBP can certainly provide only the QPSA in which case the 5-year rule would not be an option.

Yes, I believe if you are a 5% owner in the year you attain age 70.5 then you are considered such in the future regardless of any divestitures.

agreed

As long as the plan sponsor adopts (or intendeds to adopt) a SECURE amendment timely (or one is pushed out by the VS sponsor) then they can interpret the provision under the new rules even before amendment gets adopted.

If the account is closed and there is no longer a trust, how is there is still a plan? And why would you not execute a resolution to terminate and file a final EZ? That would be the smart thing to do. Otherwise you technically have an ongoing obligation to maintain updated plan documents. Just because something might be technically legal doesn't mean it's not ill-advised.

Agreed, you don't really have a terminated plan.

If you have a partial termination then everyone affected must be fully vested, and I believe that is everyone who terminated during the year. The reasoning: - people who terminated before an event (mass layoff, plant closing, sale of division, etc.) may have received forewarning and left to find a new job before being directly impacted. - people who terminated after an event may have been encouraged ("you're next") or saw writing on the wall, or thought the ship was sinking. There's never an issue saying you have a PT and fully vesting, whereas having IRS or DOL come in a year later after seeing 5500 filing and after forfeitures have been taken and applied can be a big hassle.

Correct. The only reason notices were eliminated for the SHNE is because employees did not need to do anything to receive those contributions, and the powers that be finally came to their senses after years of having to notify participants that they were getting 3% in the coming year (again) whether they contributed or not. Since matching contributions require employee deferrals, annual notices make sense - otherwise, how many doctor/owner plans would you see where "strangely" it was only the doctor with deferrals and safe harbor match?

You have two separate but related issues - the timing for deductions and the effective date (and timing) for a plan year valuation. You can deduct the pension contribution for the PY in the fiscal year that begins in the PY, ends in the PY, or some combination thereof that I've never seen anyone actually do. You say when the valuation was done but do not say what the valuation date was - it has to be either BOY or EOY. A 1/1/2020 valuation, even if done late 2020 would use 2019 compensation. What I don't know is if you are allowed to do an EOY (12/31) valuation BEFORE the end of the year. Usually the reason plans will do EOY valuation is to use that year's compensation, whether to get owner(s) a better benefit, 415 limit, or accommodate annual fluctuations. My understanding is that you are supposed to use the most recent available data for the valuation, and if 2020 PY compensation was not available when doing the 2020 valuation, then using 2019 compensation (increased for salary scale) is proper - certainly if doing a BOY valuation and IF you are allowed to do EOY valuation before the EOY. I have not seen that done but doesn't mean it's not allowed. I'm sure someone out there who is smarter than me knows that answer.

If you're asking about the 402(g) dollar limit ($19,500 for 2021) - that is an individual calendar year limit and is not affected by plan terminations, short plan years and the like.

w/o a doubt

I think restatements must be adopted by 7/31/2022. I'm not sure but I think it's the sponsors of those plans (not adopting employers) that have until 1/31/2023 to make corrections to their documents, but I could be wrong.

Last day of the seventh month, to be exact. So if payout was any time during the month of May, for example, the final EZ filing is due by 12/31 absent filing an extension (which would also be due by 12/31). And a final EZ filing is due even if the plan never exceeded $250,000 and never filed an EZ before.

How much older than 70.5 because RMD age is now 72, remember? Her RBD, not considering re-employment, was 4/1/2021, at which point she was re-employed and did not incur a break-in-service. That re-employment is now part-time I do not think matters. I do not think that a 2020 RMD would have been due either, even if not given a legal holiday. Maybe I'm wrong or overly aggressive - but the person was employed on what MIGHT have been her RBD and is still employed, so no RMDs in my opinion.

Even if he could do it, and it's not treated as a taxable sale, he shouldn't. Say his IBM stock is worth $50,000 with a cost basis of $25,000. By using it buy his policy from the plan, the URG and potential capital gain becomes ordinary income upon future distribution.

If this is an ASG and treated as one plan with one ADP test (or safe harbor exemption) then yes, 3% SH must be made for all eligible employees every year.

Insurers can and do write QJSA contracts for missing participants - terminating DBPs are faced with that a lot - but those are pieces of larger contracts. I think you'd have a very hard time finding an insurer to write one contract, but I don't know that. Yes, I think turning over to PBGC would be the best alternative and, if this were a DBP in the same situation, would likely be the only viable alternative. In the DBP space, the PBGC views an unresponsive participant as a missing participant, but I don't know if they make the same leap for DC plans.

Yeah, I could see that if it was imminent, but I would keep as flexible as possible while owner-only and then amend when needed, as needed, as the situation changes, and then this sort of hassle/inconvenience is avoided, but that's me.

No one is asking the obvious question - WTF would you do a solo owner-only 401(k) with a SHM?

If you are still employed then this was likely an error which you should discuss with both your employer and the plan service provider to have rectified (i.e., repaid to the plan). You didn't mention any 20% tax w/h attributed to your balance, which further makes this look like a mistake. David's comment above only applies if you no longer work for the plan sponsor.

Furthermore, if the new provider REQUIRES it, then that seals the deal IMHO.

Sponsor's discretionary decision and then the acts necessary to execute that decision are separate issues - like deciding to terminate a plan (discretionary action, costs associated therewith not payable from trust) and then doing all the required actions to complete the termination which are payable from the trust. Is adopting a new provider's preapproved plan absolutely NECESSARY? No, but otherwise they have an unsupported IDP w/o a D-letter. So can you very readily argue that it is fiduciary prudency to adopt new document and a necessary action to fulfill fiduciary duty? I think that is clearly the case and see no problem paying such fee from the trust.

Unless the plan includes lump sum as a distribution option, the Plan Administrator is not permitted to pay your benefits in that form. The direct rollover provisions you cite are generic statutory provisions and do not mean that the plan has a lump sum option. The plan section describing optional forms of payment will disclose whether or not lump sum is an option. Sorry for your predicament, but unfortunately the rules (if being followed) cannot be bent to accommodate you.

Partial terminations are facts and circumstances, with the presumption that a 20% reduction in actives constitutes a partial termination. I don't know if the sale of an affiliate would be eligible for the relief because I think you have to come back to prior employment levels within a certain extended period (that is, you're given an extended grace period to call back employees or hire replacements and avoid a partial termination). Also, nowhere do I see that a reduction less than 20% is necessarily NOT a partial termination, and the sale or closing of an affiliate/division/location is an employer-initiated action that results in a significant number of employee terminations.