truphao

also, you can possibly think of a method change to possibly "shift" the benefits from the FTNC to FT. That way you get a benefit of 15 years amortization which will drive your numbers down. Not sure if it would fall under the "automatic approval" of method change though - please see the rev proc. 2017-56?

LLC taxes as an S Corp. Taxes have been filed by March 15th. I do not know yet if the extension has been filed or not. Is there a creative approach to install the Plan retro to 1/1/2022?

Based on the information presented I think she would enter the CB plan but would not accrue any benefits since hours <1,000 required for accrual. Which might require the 7.5% gateway for her as a side comment. I generally agree on her entering the plans immediately upon rehire. However I do have a coupe of complicated rehire situations so I am also trying to do a refresher on BIS/rehires rules - can anyone point a good summary?

the following example is directly form PBGC website - Lastly, to qualify for the small professional service plan exemption, the professional individual(s) must be engaged in the same professional service as the principal business of the plan sponsor. For example, consider a situation where: Company X is owned by an attorney, John Smith. Company X sponsors a defined benefit plan that has never had more than 25 participants. Company X’s primary business is the sale of insurance products. In this scenario, despite the fact that the company’s owner is an attorney (a profession that’s on the statutory list of professional individuals), Company X’s defined benefit plan would not qualify for the professional service plan coverage exception.

CB Zeller, would it matter? This is husband, wife and daughter only?

nope, this is owners-only plan and those are not PBGC covered.

self-correcting - the above is assuming they have worked over 1,000 hours in prior years.

I am assuming you are referring to a DB/CB plan. Since you have 3 people in the Plan, at least 2 of them must receive a meaningful benefit to pass 401(a)(26). This is for 2022. For 2023 and onward you might want to evaluate the efficiency of the whole design with zero hours for eligibility.

dittoing Lou - there is a 401(k) plan. Solo or not - it does not matter, the plan is the plan. It exists, so it has to be dealt with accordingly. If I can only have $1 for each occurrence of "Don't make his problem your problem"......

A2 - correct A1 - I am not sure. In my opinion it would become PBGC covered. It is probably one of those situation when you would want to ask PBGC to rule on that.

agreed with comments above. Restructuring helps when you "create" 2 (or more) separate plans which used different testing strategies to demonstrate the compliance.

Thank you all for the input

Let's consider a hypothetical situation. We have a lovely couple, he is an independent 1099 ER doc, she has a one-person dental office running her business as a PC. The husband happens to be very good with finances, budget planning and all the financial matters and handles those issues for his business and as a W-2 employee for the wife's dental office. She is very good with marketing, internet media, licensing etc. and handles those aspects for herself and for the husband's business as a W-2 employee. Am I dreaming that after Secure 2.0 change to family attribution rules that particular couple would be able to double-dip everywhere on retirement plans? Two 401k plans, 2 DB/CB plans, etc.?

you want to check you Adoption Agreement to see if it restores the benefits being frozen due to "below 60%". I have seen weird things.

can somebody cite where it is in regs that you cannot aggregate plans with different plan years?

I like year-by-year approach, it is solid. I am OK with calculations based on the 2023 basis (rates, mortality, etc.) using the logic is that is when the calculations are done. I would not use "old" rates.

That is the essence of my question. How do practitioners interpret "significantly" in that context?

mega back door roth, if there is a db plan

I am curious how comfortable practitioners using Grouping with 410(a)(4)? For example, one owner, one employee. If employee's MVAR is 12% how comfortable is to give the Owner MVAR of 13.80% (=12 x 1.15)? What is the interpretation of "significant" from the https://www.law.cornell.edu/cfr/text/26/1.401(a)(4)-3?

Generally agree, but I have seen situations where the pension accounting were impacting taxation as well (insurance companies and some other odd-ball situations). We need more details.

I cannot answer that question for a couple of reasons. Firstly, the information provided is not sufficient even if I were a CPA. And secondly, I am not a CPA but just an actuary

for FYE everything gets zeroed out. In other words, if there is no plan there is no assets/liability on the books. You can get there with a settlement accounting (the clean by-the-book approach) or you just solve for whatever is missing to get you to zero (my preferred approach since zero is a zero). Whatever is missing will be the additional expense (P&L charge) for the period.

Peter, Thank you so much! Am I reading this correctly that we got another hyper-aggro design in place to squeeze few bucks away from IRS?

limitations are based on the tax/plan year if the plan doc is written properly. My concern is ability to defer 401(k) elective wrt comp earned before plan is effective. I am very interested what others have to say.