ACK

"Note that these payroll companies have already rolled things out to their clients. " Actually, my clients are telling me that they have NOT heard from their payroll companies on how this is supposed to work in payroll. I had a client recently reach out to Paycor about how they are going to manage the Roth catch-up requirement and Paycor's response on August 19th was that they are awaiting additional direction from the IRS, including potential impacts to retirement provider files and potential W2 reporting requirements. They told my client they would notify the client once their system was ready to support the new requirement. (?) I've had several clients ask me about how their payroll companies are going to handle the Roth mandate, because the payroll companies have given them no guidance at this point..

Thank you, in this case the wife does not want to roll to an IRA. She would like to keep the money in the plan with the current recordkeeper. Can the recordkeeper switch the account into her name and then she can delay the RMDs until such time as she turns 73/75? I don't know if keeping the money in the plan gives a different result than if she rolls it to an IRA?

Participant died in April 2025. He was 74 but had not started RMDs because he was still working up until his death. So he had not reached his RBD. His wife is sole beneficiary. She is in her 60s. Account is invested with a large recordkeeper. Does the wife have to start taking withdrawals, or can she wait until she turns 73 (or 75)? Should the account be transferred into her name at the recordkeeper and does that make a difference regarding the timing of when the distributions start? Thank you!!

Never mind, I found an email to use to contact the IRS about ERPA questions. EPP@IRS.gov

It seems like even though the IRS says you no longer need a PTIN if you are only preparing 5300 or 5500, in fact if you are an ERPA, you should maintain your PTIN and make sure all your CE gets reported to the IRS through the PTIN system. I have also not received a new ERPA card so now I'm starting to wonder about my status. The last card I received showed an expiration date of 2019. Who do I contact about getting an updated card? thanks!

I agree with the previous posters. However, I think that if the plan is allowing Roth deferrals, those should not be commingled in the same brokerage account as the pre-tax deferrals and employer contributions. This is going to cause issues in the future when distributions are processed and the brokerage house has to produce 1099-Rs. There is a very good likelihood that the tax reporting will be incorrect. At least if all the Roth money is kept in a separate account, there might be a better chance of the tax reporting on the Roth being correct.

If a plan already allows in-plan Roth rollovers from all sources, what would be the benefit (or downside) of adding the new Secure Act option to allow Employer contributions as Roth? It seems like the outcome in either case is exactly the same. Am I missing something? thanks!

Very sad and unusual situation. Perhaps the son should consider taking the money and using it to establish a college fund or investment account for the grandson.

Thank you!

I feel like I should know the answer to this but it is not coming to me. If a plan has semi-annual entry dates, Jan 1 and July 1, and a participant does not enroll on January 1, can they still sign up for the plan later in January because the plan allows contribution changes at any time? Do we take the position that the individual is changing from 0% to 5% (or whatever) and that is allowed any time? Or do "contribution changes" refer to something other than changing from 0%?

I would be leery of assuming the correction is 50% of the missed deferral. That applies in cases where the employee knows about the plan and should have been watching to make sure his deferrals started when they were supposed to. So the employee bears some responsibility in the error. But in this case, I suspect the employees may not have even known there was a plan.

Thank you! In this case, the deferrals for Oct 2020 were deposited in Nov 2020. The lost interest was paid in June 2021 and amounted to $34, so the 2020 5330 has a 15% penalty of $5. For the 2021 5330, Is there another $5 penalty (so $10 due for 2021)? $5 for 2020 and $10 for 2021?

Client had late deferrals in october 2020 that were quickly corrected in November 2020. I am preparing a Form 5330. The lost earnings were not posted to the plan until June 2021. I am preparing the 5330 for 2020. Do I also have to prepare a 5330 for 2021? I'm unclear on what triggers multiple filings. In my case only the earnings were deposited in the following year so I'm not sure if that requires an other 5330 for 2021.. thanks!

In this example, wouldn't it be permissible to give the employees their "gift" (sounds like a bonus) and then the employees could decide if they want to contribute any portion of it to the 401k plan (assuming the plan allows for separate election on bonuses). This way the employee has the option to decide if he wants cash or plan contribution, so you get to the result the employer is wanting. The only issue would be in the case where the employee is already at his 402(g) limit and can't contribute any more to the plan. the plan is safe harbor so 401k testing is not an issue.

I agree with jsample. This sounds more like the participant just wanted to move her money to a brokerage account and self-direct it. I would look at this from that angle..not as a distribution.. if there is a way to make that work.