C. B. Zeller

Check the plan document again, it should define a "Compensation Measurement Period" or "Compensation Computation Period." It might be through a reference, for example it might say that the compensation measurement period is the limitation year, so then you would have to check the definition of limitation year. But as long as the document says that compensation is measured for the fiscal year ending in the plan year, or similar, it should be fine.

There is a question on the 5500 asking if there was a blackout period, and if the notice was provided, so you are going to have to report it one way or another.

You have a MEP when two or more unrelated employers adopt the same plan. If one of the adopting employers wishes to leave the MEP, all that is needed is for the plan sponsor and the employer in question to execute an agreement terminating that employer's participation in the MEP. This is not a plan termination, only a termination of participation. You didn't ask, but this generally does not constitute a distributable event since it is not a plan termination. Therefore the participants wouldn't be able to roll over their balances into the new plan. I never heard of Tri-Net so I looked them up. It looks like they are a firm that handles HR functions for other companies who want to outsource those functions. I also looked them up on EFAST. I found a Tri-Net 401(k) and a Tri-Net Profit Sharing Plan but both of them are filed as single employer plans. My guess is what they have is not a true MEP - it is probably separate plans, each with their own plan documents and 5500s, but maybe the assets are pooled together to get better pricing. See if you can get a copy of their latest SAR, it might help answer some questions.

You can correct under EPCRS by retroactively amending the plan to make them eligible, as long as they are NHCEs.

There are multiple ways to calculate the earnings on a corrective deposit. You should read Rev. Proc. 2019-19 Appendix B section 3. If you are a subscriber to Erisapedia.com, their Plan Corrections eSource is a great reference for this kind of thing.

Good point, I wasn't thinking about participants who might not have a smartphone. They could bookmark the page on their phone or save a copy of the disclosure after opening it.

What's the reasoning here? In this situation I think hard copy is worse because it results in more effort on the part of the participant to be able to access the disclosures.

Except that you can't click on a piece of paper. My impression is that the DOL wants the disclosures to be as easy to access as possible. Requiring a participant to read a URL off a piece of paper and type it in to their browser, especially if it is a long URL, is not easy and few are likely to actually do it. I could see a QR code being ok on a printed notice though.

It is a safe harbor definition to exclude deferrals. Deferrals includes sec. 125 deferrals (which includes pre-tax HSA contributions) and also 401(k)-type deferrals. If you excluded just sec. 125 deferrals but not 401(k) deferrals it would not be a safe harbor definition.

Extended to July 31 https://www.irs.gov/retirement-plans/deadlines-extended-for-403b-plans-and-pre-approved-defined-benefit-plans

Thanks for reading carefully Mike. Otherwise excludables would not have to receive the gateway, assuming that there are no otherwise excludable HCEs. They do have to get the TH minimum, although if they are not eligible for the DB plan then they would only have to get the DC TH minimum.

If there was actually a termination of employment, probably nothing - but who knows if there are other facts we are missing. Maybe the participant took an in-service withdrawal prior to termination? Figured it couldn't hurt to throw it out there.

The 1099-R itself will have the answer. If the code is 1M or 7M then it is a "qualified plan loan offset" and it can be rolled over by paying the amount of the offset to an IRA before the individual's tax filing deadline (presumably 7/15). Generally this is what occurs when defaulting on a loan in conjunction with a termination of employment. If the code is 1L then it is a deemed distribution which is not eligible for rollover. If it is code 1 or 7 then it is a loan offset which can be rolled over subject to the usual 60-day deadline. In other words it's too late now.

1.416-1 Q&A M-12 provides the TH alternatives for an employer who maintains both a DB and a DC plan. 1.401(a)(4)-9(b)(2)(v) contains the combo gateway rules.

Agreed, my use of the term "waived" was sloppy language. I apologize. As of yet there is no guidance specifying a method for making the election, nor a deadline to do so. Presumably the sponsor could make the election even after the 1st day of the 10th month of the plan year and still have it apply.

I am having trouble parsing your question, but the simple version is this: if your plan has different eligibility requirements for deferrals and safe harbor, then it is subject to the TH minimum.

The only authority would be to request a coverage determination from the PBGC - which is a fairly painless process, actually. It can also happen when you have the benefit for a group defined as 0, or if you have employees who met the plan's entry requirements, but never satisfied the hour requirement to accrue a benefit in any year. In both of those cases I think you still have to count them as active.

A plan is exempt from the top heavy minimum if it "consists solely of" deferrals and match which satisfy the ADP/ACP safe harbor. IRC 416(g)(4)(H) If you have participants who are eligible for deferrals but not for safe harbor, then that portion of the plan is not satisfying the ADP safe harbor (the portion of the plan covering otherwise excludable employees is subject to the ADP test, but generally passes automatically as long as there are no HCEs). Therefore the plan as a whole no longer qualifies for the TH exemption.

I think all plan participants (and beneficiaries) have to fall into one of 3 categories: active participants, retired receiving benefits, and terminated but entitled to future benefits. Any participant who is neither retired and receiving benefits, nor terminated and entitled to future vested benefits, would have to be an active participant. If there is any doubt, request a coverage determination from the PBGC.

It added a new safe harbor, while leaving the old one in place. I think that's what most of us would prefer - since many sponsors are probably comfortable with their current understanding of their obligations and happy to continue doing it that way.

CARES Act waived the requirement to certify an AFTAP for any plan years beginning or ending in 2020. However, if you wanted to certify one anyway, because maybe your 2020 AFTAP would be materially higher than your 2019 AFTAP, then I do not believe the due date would be extended.

There was a law a while back that explicitly permits in-plan Roth conversions of amounts which would otherwise not be distributable. The converted account remains subject to whatever withdrawal restrictions applied before the conversion. See Notice 2013-74. This is optional of course; plans are free to restrict in-plan Roth conversions to amounts that would be otherwise eligible for a distribution.

I recommend you read the instructions on the site. The definitions are under the "Glossary" section. Recovery Date - The date that the Principal Amount is restored to the plan. Final Payment Date - The date on which Lost Earnings is paid to the Plan, if later than the Recovery Date.

Doc - you are correct about CARES 3608(b). However the act says that the plan "may elect" to treat the 2019 AFTAP as the 2020 AFTAP - it is not required. What David is saying, and please correct me if I am misinterpreting, is could/should a plan sponsor instruct the actuary not to certify the AFTAP for 2020, and also not elect to apply CARES 3608(b), thereby causing the plan to have a presumed AFTAP <60% as of October 1, 2020 (assuming calendar year). One effect of having an AFTAP less than 60% is that the plan is not permitted to pay lump sum benefits. Not having to pay lump sums may be advantageous to the plan's financial health after a large drop in the value of plan assets. I feel like this could be construed as administrator discretion in the availability of a form of benefit. If one of my clients asked me if they could do this, I would advise against it.

In addition to the TGPC, ASPPA has a CPC module about nonqualified plans. It's not specific to 457(f) plans but they are on the syllabus. Derrin Watson has a 457 book available on erisapedia.com; it is, like everything the man writes, excellent. But it is more of a reference manual than a training resource.