CarolC

Not a lawyer here, but… ERISA Section 203(a)(1) says that the vesting requirements are met if employee’s contributions are nonforfeitable. And 203(a)(2)(B) says that an individual account plan must meet the minimum vesting schedule. That sounds to me like Section 203 is governing vesting for the 401(k)/safe harbor plan that TPA is referring to. Code Section 6057 says the Plan Administrator is to report participants who separated from service during the plan year, so I don’t see how waiting years for the terminated participant to reach NRA would be correct. I believe the standard industry practice is what Jakyasar been doing – reporting them in the following year (and we have standard practices for a reason). My experience in 25 years is that’s what TPAs do. I think it is that TPA Jakyasar is talking with who is missing something.

Your previous employer may be able to convince them to cooperate. It is standard procedure in the industry to cut two checks (and two 1099-R forms) when pre-tax and Roth are distributed from the same account. Apparently their call center staff knows this. Your former employer may not appreciate that their bank will not comply with the usual process.

We are (finally!) going to e-signatures using DocuSign. Ftwilliam has a white paper citing specific Rev Procs that all e-signature for prototype and volume submitter. I'm attempting an attachment...E-signatureWhitePaper.pdf

We would show an In Plan Roth Rollover as a related rollover on our software. It would be included in Top Heavy and would be subject to rollover rules. Since the funds were never actually withdrawn, that's what made sense to us ...

My apologies for the delay - I was out for two days. Mr. Luke, the forfeitures are fair and square - BG5150 they are using 100% of the forfeiture account to offset contributions. The document allows forfeitures to be used to offset contribution or pay fees if there are no account restorations required. If the account had a loss, clearly the employer would not benefit from the use of plan assets. My thinking is along Ms. Kimberly's line - that earnings should be allocated to participants and not benefit the employer by reducing the current contribution. I realize that the employer loses the benefit of a high deduction by using the earnings to offset contributions, but I understood that the employer can use funds previously contributed - period. Am I on target? Thank you all for your help!

I don't usually worry about $5 or $10 in earnings in forfeiture accounts, but recently I am seeing large plans with $3500 and $5000+ in annual earnings. The employer is using forfeitures and their earnings to offset discretionary contributions. It feels wrong - the earnings part, I mean. Wouldn't this be a prohibited transaction? I feel more confident that it would be a PT if it were Safe Harbor/QNEC/QMAC contributions they were using earnings to offset. Your thoughts and guidance will be appreciated!

We submitted a DB document on December 3, 2018. I'm not sure when the last contact was, but we do not have a compliance statement yet.

We use the ftwilliam document. Sometimes love the flexibility, sometimes wish it would just tell us what to do. What we've done to solve this particular issue is to have a separate "Administrative Interpretation" document where we spell out whether or not the sponsor chooses to do true-ups on the match.