CuseFan

Plan document should specify if loan is treated as general asset of the trust (allocate interest to all, do not reduce participant balance for loan) or as directed investment (reduce balance, allocate principal and interest to just him).

The only other impact of NRA in a DCP is that many times the hours and last day requirements for a PS allocation are waived for retirement. It's more relevant to a DBP discussion, but regardless, it would as CBZ said require a law change. Furthermore, couldn't see it applying to existing participants, which would mean tracking different NRAs for different populations - not a big deal for safe harbor formula plans, but how many DBP with such are still open to new entrants? I don't even want to think about trying to cross-test such a situation. But this doesn't look to be on any legislative radar that I've seen and IRS (and/or Congress) couldn't even get their act together in coordinating actuarial increases (still 70 1/2) with the new RBD age 72.

Yes, you can roll from IRA into 401(k). There is nothing to correct. There are two distributions here - one from plan A rolled to IRA reported by plan A and another from IRA rolled to plan B which will be reported by the IRA.

Agreed - it was time well spent.

Probably not professional services then either and so subject to PBGC, yes?

Maybe. The rules vary by state, but I think most states these days allow protection of IRA money at a similar level as qualified plans. Probably something you can Google easily enough.

You say this happened due to purchases and you just found out about the other plan, so I assume you hopefully have time under the transition rules to be able to get this sorted out. Plan R has a large contingent of "per diem" class of employees - those called in to work on a day to day basis. I would do a deeper dig on that population with respect to hours history. If that much of their population is in this class, it might be that the majority have never worked more than 1000 hours in a year and may be statutorily excluded. If this group predominantly works 1000+ hours per year, then this classification itself may be problematic and was a smokescreen attempt to exclude part-time employees. Even if not the previous intent, it's like salaried employees are in, hourly employees are out, and that is just fine until you fail coverage because hourlies far out number salaried. If you can't find enough statutory exclusions amongst the per diem (we just need 11,780 votes, er, exclusions) then I would run average benefits as the next step and progress from there.

Not possible, unless you mean that each would pass if they were the (only) employer, which is irrelevant. Must be the two companies not doing PS have a large contingent of the control group's NHCEs while the HCEs are concentrated in the smaller companies doing PS, which the control group coverage testing rules are designed to prohibit. Can't help you with the software issue but your description sounds like maybe the statutory exclusions are not being handled properly, whether it's the software or your coding.

Agreed, plans are combined to determine the filing threshold, but if they are required to file then each must file separately.

Yes, by law, the spouse at the time of death must be sole primary beneficiary. Plan can require that they be married for a year before that kicks in, so check the document language, although you look to be past that regardless. This is, of course, subject to any QDRO wife #1 may file.

Not saying that doesn't happen, a lot, and if their accountant is on board, then fine, but how is that justified as a reasonable deductible business expense?

16a - yes 16b - $300,000 17a - yes 17b - no 17c1 - enter adoption date of the plan if provision has always been there 17c2 - enter effective date of the plan This is all the same regardless of whether or not the excess will be transferred to a QRP.

CARES Act non cash bonus? Never heard of this, Googled and all that came up was charitable donation stuff. Further explanation please.

He should also make sure his child is performing service for the business that is commensurate with the pay he is provided.

Personal opinion, others may disagree - but to include in ADP the person must be eligible to make a salary deferral for the year. Yes, technically the person may have entered the plan but since they were not eligible to defer any pay for the year I would exclude from testing. Re 5500, I would treat the same to be consistent, but it probably doesn't matter unless it's the difference between 120 and 121 total participants. Also personal opinion, this is poor design. Immediate eligibility is fine, but knowing payroll is once a month on the first, why not make plan entry date the first of the month coincident with or next following date of hire? Administratively the same but avoids the confusion of your situation. And double check the document that it's not already like that - you mention no eligibility requirements but eligibility and entry are separate, albeit related, concepts.

yes and yes

I would do the prescribed 1 to 1. Small allocations shouldn't be an issue - they may look odd, but my guess is they'll go unnoticed or unquestioned. And there is a de minimis exception for any that might then need to be currently distributed, so you can avoid that hassle. Or, as you note, just process the corrective distribution and roll the dice, and/or bring the custodian into the conversation and discuss how they propose to properly address and fix their error.

1. Agree with Bill on preference to use 11g amendments. 2. If plan defines year of service in terms of hours, then my opinion is that hours should be your measuring standard and employee B gets added. 3. Could Plan Administrator reasonably interpret that provision in the alternative? Sure, and maybe that is best way to handle, but then document their decision so it gets applied consistently in the future. 4. The spirit of the failsafe is to add in the people closest to fulfilling the allocation requirement - but if you require both hours and year-end employment, who is considered closest, most hours or latest employment? The provision disregards the 1,000 hour rule first in favor of year-end employment, so maybe that is the intended measuring stick for who is closest, so I'm no longer strongly favoring hours as stated in #2 above. Suggest the Plan Administrator decides and then amending out this provision in favor of future 11g amendments.

No. You need to view the above as a transfer for all purposes and not a termination, same as going from an eligible employee to ineligible employee in the same plan (think non-union to union status).

If you think there was fraud involved, and can prove it, then hiring an attorney to sue your ex and have the QDRO rescinded may be your only recourse. A QDRO need not be signed by the litigants as far as I know, and if all the pieces that qualify a DRO as a QDRO are there then the Plan Administrator is required to follow. There is nothing you state that implies the Plan Administrator did anything wrong.

Good point - were people accounted for as in pay status or paid out lump sums? And how could that be recorded w/o assets actually leaving the plan?

This brings up more questions - HOW were those assets paid from general assets, taxes withheld, distributions reported, etc.? Was that all done properly such that the company was merely functioning as the paying agent for the plan? I've seen that before - not a best practice for sure - but the required funds left the plan and flowed through the company's checking account with the proper tax withholding and reporting. Why would they not want to recover those assets? Wonder if not doing so would constitute contributions to the plan and if so, would that create any issues? You don't say how long this has been going on - what is "a few years back"? If this has been 2 or 3 years then I'd be inclined to reimburse the company from the plan, whether they want or not, and move on. If this has been going on longer, then maybe a VCP. Or reimburse for recent (or open) years only and move forward. Or, actually spend some money and do the right thing and get a bank to function as paying agent. What was going on with all this before the acquisition? Did the seller act as plan paying agent as well? Finally, how has the company reconciled all this on their books, and did they take corporate deductions for plan benefit distributions? Sorry, more questions than answers.

It is the responsibility of the trustee to provide the value of all plan assets, how and where the trustee obtains those values is up to the trustee, but failure to do so accurately such that the plan's fair market value is not annually ascertained is a fiduciary breach in my opinion. Just because it is owner only doesn't mean (s)he can do whatever (s)he wants with the assets w/o accounting and accountability.

Thanks Everyone. Yeah, the "dark siders" usually defer to my expertise in shedding light for them, but apparently not this time! Enjoy the weekend - stay safe and stay warm, especially if caught in the polar vortex.

ESOPs were not always part of and eligible for the pre-approved/volume submitter document program. I think it was just the prior cycle for which that was available. That means the plan was individually designed by definition - regardless of the document platform that was used (like cash balance plans years back). Like cash balance plans, or any plan for that matter, the ESOP was not required to be put on a pre-approved document. You can always remain individually designed, in which case you need not and can not submit an updated document for a determination letter, except for an initial determination, plan termination or other special circumstances defined by the Secretary. However, individually designed plans are still required to be amended timely for changes in the law and periodically restated after a certain number of amendments - you need not restate every 6 years as with pre-approved documents. Look at the existing document, it's determination letter and the prior 5-year cycle under which this came. It might be a cycle B or C plan for which a 2013 restatement would be appropriate - BUT, they should also then have any and all required interim amendments for ESOPs, adopted timely (which is, as you know, one of the primary advantages of using a pre-approved document). So even if the intent was adopt a new pre-approved document as evidenced by a resolution, the lack thereof may not be a compliance issue. Updated SPDs are also a periodic requirement and may not necessarily mean a restatement was prepared. Hope this was helpful and good luck.