CuseFan

I know "one and done" politics won't work because the first half of the term is learning and the second half is arguing/jockeying for your agenda, and so it's the third half when things would actually get done - and I work with enough actuaries to know there isn't a third half. 10-year scoring makes sense for a tax expenditure but, as we all in the retirement industry know, not for a tax deferral. And where will all the tax revenue come from in 40-50 years when the majority of retirement distributions are tax free Roth dollars? Who cares, we'll let the next generation of post-millennials deal with that. Sorry, current politics has me in a cynical ranting mood!

single sum make-up payment with interest at plan's actuarial equivalent rate to the date of correction and then adjusted/corrected payments going forward, not rollover eligible and no other available elections - this is cut and dried.

Politics is all about what you do now to get re-elected, not what you do for the long term health and welfare of the nation. Killing small business retirement plans to generate current revenue at the expense of both future revenue - because it's a tax deferral - and the cost of increased future entitlements - because more people will retire into poverty - is short-sighted. Same with negotiating with unions on governmental plans, particularly post-retirement health, as politicians secure lower current wage increases for immediate tax savings but give away unsustainable future benefits and let future generations deal with it. These "kick the can down the road" policies are setting this country up for a huge generation and class warfare among four quadrants of citizens: wealthy aged, poor aged, self-sufficient youth and un/under-employed youth. Forget political term limits - make everything an extended single term so there are no re-elections, and mandate there must be a "term off" before running for a different office. Then we might get true public servants with the country's best interests in mind, not career politicians working only to stay in power. Unfortunately, "House of Cards" is probably very close to true politics in this country.

I think you are correct, and this is contrary to how certain "veterans" in the industry (self included) were brought up. Although, just thinking conceptually, this does make sense. You have an HCE excess in 2016, it becomes taxable in 2017, but instead of distributing it you allow it to remain in the plan as an after-tax contribution - in essence, you have allowed them to re-contribute it to the plan, so why wouldn't it be ACP tested in 2017? Unless you have an unusual design or testing results, I wouldn't anticipate recharacterized deferrals being able to satisfy ACP testing with existing match, but who knows?

I think it depends on the terms of the Plan. if this is an owner who is still employed/active, unless the Plan allows for in-service distribution after NRA (or age 62 if applicable), I don't think you have a distributable event until the RBD. If the person is separated, no problem. If not, and that language isn't in the Plan it can be amended. Also, the Plan could (if it has the provisions) commence the minimum annuity (50% J&S) beginning 4/1 and then provide a new annuity starting date upon actual retirement and allow a lump sum election if desired.

agreed, if the funds were timely segregated from employer assets and deposited - the timing of investment/trade is another matter and one which was apparently corrected so that participants were not harmed.

i would go the other way, to avoid a situation where the code is in and out of filings from year to year, but I personally don't think it matters because you can reasonably justify either answer and this is really just statistics the IRS/DOL is collecting year after year for our pleasure.

Hey, Mario was an excellent fielding shortstop!

if company A and company B where separate with no overlapping employees pre-transaction, i think it would be reasonable to look back at them separately for HCE determination and similarly for NHCE ADP or, as suggested, using the prior NHCE ADP for both in 2017 testing. I don't think there is any regulatory guidance, so you do what is reasonable and document a logical case for why - as long as it does not result in abuses and the HCEs benefiting substantially more than they were otherwise benefiting before, I don't see the IRS challenging it. Also, if the plan isn't amended to change coverage or benefits, don't you have the option to test as one plan under the M&A transition rules? I thought those ran both ways - acquisitions and divestitures.

correct, not ez eligible

Are there no HCEs getting current allocations or no HCEs in the plan? If you have HCEs and they get future allocations from the individual rate group formula then you could have a BRF issue regardless if gateway and NDT were satisfied, unless NHCEs received similar allocations that were fully vested.

Whenever a plan sponsor wants to do something like this that might be a PT I always refer them to qualified legal counsel for an opinion.

Absolutely not - regulations are specific that you can use the average ENAR of the NHCEs benefiting in the CBP as the ENAR for each NHCE benefiting in the plan. The four who do not benefit in the CBP need additional 2.5% in PS to satisfy gateway.

your spouse must sign-off to your designation of your father as beneficiary if you are married

Wow, what business is the plan sponsor in? Wait, don't tell me, I don't want to turn up missing like the participant!

A plan to plan transfer is different than a direct rollover, which is why there is specific and different language in the plan document. A "transferred" benefit usually is more restricted and used in special circumstances - you almost always want to have a direct rollover.

I believe ETA's second approach is the right way to go. I also believe the DOL position would be the transaction is not "complete", that the participant has not been paid, and that the funds are still plan assets which must be restored to the participant's account until such time as they can be paid.

For ABT you include all benefit sources - so all employer and employee contributions (except catch-ups, which don't count toward anything except their own limit, and how an employee could be over $18k). An entity that may have been controlled by a church (maybe a hospital, nursing home, school) and so sponsors a church plan (current court cases notwithstanding) is then acquired by another non-church entity - voila, no longer a church plan and subject to the various ERISA requirements for coverage, nondiscrimination, etc.

Forever is the plan sponsor's responsibility, not a former service provider, but agree that forever shouldn't cause you any problems. Also recommend investing in a good copier/scanner and keep paperless records - for both current and former clients - and get rid of the paper and the boxes.

That's the bigger issue - failing ADP testing every year. The plan would never have qualified for EZ filings. Filing a false EZ return now under penalty of perjury is not recommended and likely why the TPA says not to file. Terminating and rolling to an IRA and pretending like the plan never existed carries its own risks as well - how do you demonstrate to the IRA custodian that the rollover comes from a qualified plan? How do you as plan administrator certify that when you know the truth? Anything you do that is not a "legal fix" will keep you awake at night for at least the next three years while the tax return audit statute of limitations to run out. I would contact an ERISA attorney, have your service agreements with EJ all reviewed to see if they were in breach of contract and explore malpractice. IRS and DOL correction programs can help chart the required fixes - which in addition to filing all past returns, includes either making corrective QNEC contributions for your employee for all those prior years and/or distributing your excess contributions and interest thereon. You can even have the IRS approached anonymously on behalf of your plan with a proposed solution before committing. Not doing the correct fix and then getting caught will be far more painful than fixing it right. Good luck

You can also increase the distribution for anticipated tax liability but do not need to actually withhold that amount for taxes, so that provides more cushion toward future payments - but also potentially make him severely under withheld come next 4/15.

you must specify the excluded class in the document and you must allow them plan entry if and when they work 1000 hours

NQDC is always reported via W-2 unless it's a death benefit paid to a beneficiary, then 1099R is appropriate. There should be no FICA/Medicare issues because that should have been applied along the way - unless amounts did not vest until just before payments were to begin (or it was a DB SERP where the PVAB was not reasonably ascertainable until commencement). Regardless, it is more a payroll function than a TPA or trustee/custodian function as HR stated.

Agree with Kevin to double check the document because that sort of provision has become much more common among pre-approved plans. Also, I do not think there is any prohibition against receiving a valid beneficiary designation post-death, the 401(a)(9) regulations even mention a designated beneficiary by the 9/30 of the year following the year of death. That said, as everyone else notes, the validity/authenticity of the beneficiary designation is the important question of fact.

i would hope the beneficiary designation was the bank as trustee of the trust and did not just list the bank itself as beneficiary. if that is the case, I don't see any reason for the PA to go through the trust agreement after establishing to its satisfaction that the bank is the trustee to this trust. As only a person or a trust can be named a beneficiary (right?), if the form did simply name the bank as beneficiary then I think the validity is in question and it's more complicated. In that case a review of the agreement might be warranted, but I might suggest legal consultation, especially if someone other than the surviving spouse is trust beneficiary. As far as document retention, it doesn't hurt to keep.