SSRRS

Hi, The 415 is 19,166. This is increased if the particpant is age 71 (provided that had enough salary average to cover).correct? If this is indeed increased, it is increased from 65 to 71 and not from 62 to 71. Correct?..Thank you very much.

Thank you.

Thank you so much Lou S.

Thank you so much Effen. If at death of her husband, the wife (new plan sponsor) elected to take a lump sum equivalent of her husband's annuity that he was taking, however, due to the the rough transition period, the lump sum was delayed until now (3 years later) and the wife in the interim took the annuity for the past 3 years, can this allow her (hopefully) to take the lump sum now? Also, the plan has not been terminated as the plan is very overfunded. The widow has been accruing benefits each year Thank you very much.

Lou S., thank you for this point. Would this apply for DB minimum funding as well, or if a DB plan has a minimum required contribution, then it would still be due (the minimum required portion of the contribution) by 8.5 months after the plan year end.- and the rest of the contribution up to the maximum , can be made up until the new due date of the return? Thank you.

Bird, thank you very much.

Thank you very much. What if the plan was under examination, would it still be advisable to amend ?

Thank you Bird.

Thank you ESOP Guy

Thank you duckthing. Is it ok to amend and show the WH going out of the plan in the prior year 5500 even though it was not actually paid until the following year?

Hi, Terminated employee in DC Plan elected a lump sum and 20% was withheld as required. The 20% sat in the plan until the following plan year when it was sent to the IRS. The 80% that the employee received as a lump sum was shown on the 5500SF in the year it was received and the 20% withholding was shown on the following year 5500 SF (since it sat in the plan assets until the following plan year). Are there potential penalties for this and can this be rectified? Thank you very much.

Thank you very much Effen. The wife now owns the company, and the participants are all HCEs. The plan is overfunded and at this point it does not appear that the plan will be terminated in the near future. I just want to clarify, the wife can take a lump sum as beneficiary of her husband , even though the husband had elected and was taking his annual RMD in the form of a J&S with years certain annuity? Thank you.

Hi, Sole proprietor (with employees in plan) elected at age 70.5 to take his RMD based on 100% J&S with 15 years certain annuity. After a few year of taking his annual RMD, he passed away in 2018 and since then his wife (the survivor) has been taking the RMD based on the annuity that her husband elected. She now wants to take a Lump sum, and and after taking the 2021 RMD, will transfer the lump sum to an IRA. Is a lump sum permissible, or must she continue to take the yearly annuity? Thank you.

And Bird as well.

Thank you, Luke Bailey, as always, your knowledge and analytical brilliance is much appreciated.

Bird, thank you very much, for the clarification. As always your knowledge is appreciated.

Thank you very much Luke Bailey. This particular case was not a case of increasing pay, thru reducing the contribution. Rather , the company simply did not want to include the shareholders and the wives of the shareholders in the annual contribution (HCEs). Would the following provision in the eligibility section of the document been a better option for them? "For purposes of this Plan, all Employees are Eligible Employees except for the following ineligible classes of Employees: (1) Union Employees; (2) Non-Resident Alien Employees; and (3) the shareholders Jack and Jill, and spouses, children or parents of the shareholders."

Thank you BG5150 and DogHouse.

Thank you BG5150. This is a Volume Submitter approved plan.

Thank Thank you very much Bird, for your insights and knowledge. I just want to clarify that the provision of limiting the compensation to $0 is only for "any participant who is a Key Employee, an Owner-Employee, a Self-Employed Individual, or a Highly Compensated Employee". Meaning the company is making contributions for the NHCEs and just not making contributions for the shareholders, whom have elected to limit their compensation to $0. Also, would it be better if the document would have just stated in the eligibility section the following? "For purposes of this Plan, all Employees are Eligible Employees except for the following ineligible classes of Employees: (1) Union Employees; (2) Non-Resident Alien Employees; and (3) the shareholders Jack and Jill, and their spouses, and any children of the shareholders." Thank you again.

Hi, I would greatly appreciate any insights etc., on the below. A DC (Money Purchase) Plan (volume submitter) has a provision in the compensation definition section (shown below) that allows the owners to sign a form that states that their compensation for the year of the effective date of the plan and all future years is $0. Their contribution based on this is $0, and only the employees receive an annual contribution. Are there any issues with this? Thank you. Compensation Limitation Election Available to Certain Participants. Except for determining Top Heavy allocation requirements under Section 3.5 or Code §415 limitations of Article 6, any participant who is a Key Employee, an Owner-Employee, a Self-Employed Individual, or a Highly Compensated Employee may elect for any Plan Year, on a form prescribed by the Administrator to limit Compensation for all purposes under this Plan.

It has been mentioned on this forum that the EZ Forms that were sent during the pandemic are not being processed. This might explain why the IRS sent this reminder even though the form was marked as the final form. The IRS seems to send this yearly to EZ filers.

Yes, Effen you are correct, this has been dedication at it's best. Thank you very much David. Your knowledge and insight in general are appreciated as well.

To clarify the above, if the 5500-EZ for the years that the IRS claims they did not receive were actually filed, why should the sponsor have to pay fees for the Delinquent filer relief program? The sponsor even has a copy of the October 15, 2020 postmark for the 2019 filing.

Hi, Owner only DB plan received letter that his plan has been selected for examination. The exam seems to be just that the IRS did not get his EZ for 12,13, and 2019 (for location and date it says N/A). The agent says that he should file the missing EZs with the delq. program, however, it must be sent to the agent (as opposed to filing directly DELQ. program). The 2019 was just filed on October 15th, 2020. The other years as well. I recall that there was mention that there isn't anyone at the IRS location to process the 2019 EZs. Thank you.