C. B. Zeller

I don't have any first hand experience in this area, but I will merely observe that there is a separate penalty for failure to file the 5500 under IRC 6652(e) and for failure to file the actuarial report under IRC 6692. This might suggest that (for IRS purposes at least) the 5500 would be accepted without the schedule SB but you would start accruing the $1,000/day penalty under sec. 6692 at that point.

If you are asking about the extension granted under the CARES Act, then no. The CARES Act only extended the deadline for plans for which the minimum contribution is determined under sec. 430. See Notice 2020-61 Q&A-1

How are they HCE with less than a year of service? Are they the owners' kids? At the risk of stating the obvious ... letting the owners' kids in after 30 days but making regular employees wait a full year is exactly the kind of behavior the coverage rules are intended to prevent. Have you checked the plan document to see if it says what happens when coverage fails? Some documents will provide that non-excludable NHCEs are brought in automatically.

Yeah, I think that is Nitro's biggest failing. I got used to it eventually. If you right-click on any tab you can open it in a new tab group, which helps for looking at documents side-by-side. Sometimes I resort to opening a PDF in a browser window if I really need to see it on a different monitor.

One "trick" I have used in the past, if your keys are >50 years old, is to set a maximum deferral limit of $0 for key employees. Then their contributions (up to the catch-up limit) will be automatically reclassified as catch-up, and since catch-up is disregarded for top heavy purposes, it doesn't trigger the top heavy minimum. However, I don't think you could add this limit mid-year without it being a 411(d)(6) problem. Maybe you could get away with it if none of the keys have contributed more than the catch-up limit year to date.

Usually you can't actually defer 100% of pay, since medicare and social security tax have to be withheld. Medicare is 1.45% and social security is 6.2% so the max she could actually defer would be about 92%. That should leave plenty of room for a 4% safe harbor match. That said, the plan document should specify how 415 violations are corrected.

Maybe someone with more expertise in this particular area will chime in, but I have a hard time imagining the DOL getting involved in a situation like this. The DOL exists to protect the rights of employees, and a service provider is not an employee. This sounds like a contract dispute between two businesses.

For Nitro you only get the version that was current at the time you bought it. They did contact me at one point offering upgrade pricing (cheaper than the full purchase price) to get us on whatever the newest version was at the time, but I don't know if that's something that's always available. The way the software industry is today, you will usually only get upgrades forever if you pay forever, i.e. subscription model.

We switched from Adobe to Nitro in our office a few years ago. https://www.gonitro.com/ They have both a subscription option and a perpetual license option. We went for the perpetual license.

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.