C. B. Zeller

Using a combination of a mortality assumption, an interest rate assumption, and the participant's age, you can calculate a factor called Annuity Purchase Rate or APR. This is equal to the amount needed to buy an annuity commencing immediately of $1 per month until the participant dies (or in the case of a 100% joint & survivor annuity, $1 per month until the participant and their spouse both die). The mortality, interest, and age assumptions are all specified in the DOL rule. You should be able to plug those into your software to get the APR. (If you are interested in the math behind the calculation of the APR, be warned you are delving into the realm of actuarial mathematics. I recommend the text Life Contingencies by Jordan. Theory of Interest and Life Contingencies With Pension Applications by Parmenter is also very good.) Once you determine the APR, divide the account balance by the APR to get the amount of the monthly annuity.

Is the new doctor a 5% owner? If not then they would be NHCE in their year of hire.

The metadata on the file will show the date the file was created or last updated. If we are talking about scanning documents, the date in the metadata would be the date the document was scanned, not the date of the original document. If you wanted to set the timestamp on the file to something other than the date it was scanned, you would need to do so manually. Every file manager in existence lets you rename files. It is not usually so easy to modify a file's timestamp without some specialty software. This kind of metadata is also sometimes lost when files are backed up or restored. Well-designed software would carefully preserve it but sadly that is not always the case. The information contained in the file name is much more likely to survive.

If you format it as YYYY-MM-DD and put it at the beginning of the file name, it makes it easy to sort chronologically.

415(b)(5) provides that the maximum annual benefit is prorated for less than 10 years of participation. In the first year the maximum benefit he can accrue is 1/10th of the annual dollar limit.

There's nothing in the CARES Act that says they can't. The plan document might restrict CRDs to only active employees though. Most of us probably don't have CARES amendments in hand yet. You should ask your document provider if there is anything in their CARES amendment which would restrict a terminated participant from taking a CRD. There is always the option to roll the balance over to an IRA, and then take their CRD from there.

Why not just terminate the plan?

Absolutely. How it's communicated doesn't really matter, if anyone gets any benefit, whether inside or outside the plan, that is determined based on whether or not they deferred, or how much they deferred, it is a violation. There are a few exceptions to this rule, one of which is matching contributions. And a correction to my previous reply, it is called the "contingent benefit rule" not the "conditional benefit rule" as I said earlier. 1.401(k)-1(e)(6)

You can't do that with profit sharing, it would violate the conditional benefit rule. It would have to be treated as a match, subject to the ACP test and the other 401(m) rules. I am not sure whether you can do a match formula that is based on a flat dollar amount, as opposed to a percentage of pay. Personally I have never seen it done that way.

Since you mention the employee hasn't reached normal retirement age yet, we are presumably talking about an early retirement benefit? ERBs are a benefit, right or feature subject to nondiscriminatory availability requirements. Like Effen said, as long as you make the same benefit available to all HCEs and non-HCEs alike, you should have no problem.

Absolutely! The other resources at ERISApedia.com are excellent as well.

Yes, 81-105 and the 1983 proposed regs are still in effect. Shout out to Derrin Watson's "Who's the Employer" which succinctly answers this and (I have not counted but probably) thousands of other questions.

Nothing in the Code requires this. Your plan document might.

This sounds like an overpayment failure correctable under EPCRS. Under EPCRS the plan does not have to request repayment of amounts less than $100. From Rev Proc 2019-19:

Roll it over to an IRA. From Notice 2005-05:

Good point Luke. The W-2 safe harbor definition includes wages as defined in 3401(a), and 3401(a)(23) explicitly includes amounts includible in income due to 409A.

The reference in question is 1.401(m)-2(a)(5)(iv) Since the reg says a plan is "permitted to" disregard the match (not required to) it follows that a plan is also permitted to include the match.

You can always exclude any portion of compensation for HCEs and still have a safe harbor definition of compensation. That said, this this phantom stock plan sounds like a nonqualified deferred compensation plan. Here is what 1.415(c)-2(c) says:

I will remind clients in this situation that we are not tax experts and we can't in good faith provide them with tax advice. Our valuation report has a line that says something along the lines of, "This is the maximum deductible contribution under IRC sec. 404, but we can not confirm that this amount is deductible for federal income tax purposes, check with your tax advisor or accountant." That said, I agree with Lou's understanding, I don't think there is a way to deduct an amount that would cause a loss. If they contribute the amount anyway, they have a non-deductible contribution which is subject to excise tax. There is an exemption to the excise tax for the amount necessary to satisfy minimum funding. To your second question, the deduction is not based on average comp. It is based on the sum of the funding target plus target normal cost plus cushion amount over the market value of assets. If the plan's benefit formula is based on average comp, then the funding target and target normal cost could be affected by a change in average comp, but given the very low 2018 comp for #1, I expect it's going to be hard to get an appreciable increase in the average for 2019, especially considering 401(a)(17) limits.

The top heavy rules are full of contradictions when compared to other sections of the code. Why can you disaggregate otherwise excludables for coverage but not for top heavy? Nondiscrimination can be tested using pay as a participant, but top heavy has to use full year compensation regardless of entry date? I could go on, but it's not going to help anything unless Congress decides to change it. If the objection is just to having to actually having to do the amendment, you might include a 410(b) fail-safe in your plan document which would automatically bring in enough NHCEs to satisfy coverage. Another advantage of this is it might bring in someone who is unvested, allowing you to forfeit their contribution. If you do an -11(g) for a terminated participant they have to be at least partially vested.

1.416-1 Q&A M-10

Yes, you have to do the -11(g) amendment, otherwise you have a qualification failure.

You never need to use it, it's only a safe harbor. Any differences between your notice and the model take yours out of the safe harbor, but don't necessarily make it invalid.

Yes Does coverage pass using the average benefits test? Does the plan document have a 410(b) fail-safe provision? If not, then you have to do an -11(g) amendment to add benefits for some NHCEs.