StephenD

So it is still not too late to adopt a different SEP prototype for 2022, effective 1/1/22. You just need to find one. Cathyw thinks Pro has one. If you find another, please let us know!

Hiya. This is not like a SIMPLE. You can have a SEP and a DB Plan in the same year. However, the SEP deduction is limited to 6% of comp. The reason why I am commenting is I have been looking for a non-phototype SEP document, with a feature that allows you to also sponsor other plans simultaneously. Can you please share where we can get one like this? I can't seem to find one anywhere!

Hiya Drake! Sorry, but without subsequent IRS guidance, we need to take the statute literally. "Section 317 is effective for plan years beginning after the date of enactment of this Act." means that for 2023 plans, this rule is in place, and for 2022, we are stuck with putting together a plan and election form before 12/31.

Please let's not confuse getting paid with being employed. If the kids are not really employed, and did not work there, then they are not eligible for the Plan. I see this all the time with even babies on the payroll. "it appears that they let their two children work part-time". Is that an assumption, or a fact?

Recordkeepers have their own view of the world. The way we handle it is that we ask an official of the organization if they are willing to serve as the "trustee". Then we fill-in the box on the Recordkeeper's system with that person''s name. Then the problem goes away. In the 50 years we have been doing this, no problems were ever created by telling the recordkeeper this info. I'm sure all the lawyers will say that it's a bad idea, but sometimes expedience trumps legal preferences.

Hiya John! We are very happy with our IT firm (based in SF) and if you went with them they would already understand how to work with ASC, FTWilliams, Pension Pro, etc on a remote basis with the highest concern for quality and cybersecurity. They are not inexpensive but, like TPAs, you get what you pay for. You can reach out to me at SDobrow@primarkbenefits.com.

Judging from my takeovers, I'd say most of them. We use ASC, and they definitely have it for their DC Plans.

Just want to add what a lot of people miss. FICA. Employer Contributions are really deferrals, even though the employer makes them, and are therefore subject to FICA like any other deferral. Therefore, the employer and the employee need to pay FICA taxes on the amounts contributed. If they don't, they will pay FICA taxes on the way out of the plan - on the whole amount distributed which includes all of the earnings! Nice way to lose a lot of your gains. So put the employer contribution as a bonus on the paycheck and process them like deferrals, then the taxation will be correct, and you can avoid going over the $19,500 limit. It took me a long time to figure this out because I've never seen it in writing anywhere.

I have used Dietrich for this exact circumstance and found them to be excellent. While there are many annuity providers that won't sell an annuity unless they have the annuitant's signature, Dietrich can find one who will.

Hiya Folks! I've seen many IRS-approved prototypes with the ability to select something other than the calendar year. No reason why SEP has to be calendar.

HIya. Maybe I'm missing something (and if I am I know the people here will correct me) but I thought that the IRS was not accepting 403(b) non-amenders in EPCRS, but there is an alternative. Here is what Robert Richter (ASPPA)had to say on a recent webcast: "Even though it is not explicitly stated in Rev. Proc. 2019-19, a missed 403(b) restatement can be corrected using SCP if the conditions are satisfied. It is not as clear regarding DB plans and other qualified plans. We have indications from the IRS that it is available, but the revenue procedure appears to support those intentions. The ARA has raised the issue with the IRS, and we hope the IRS will confirm, in a more explicit way, that SCP can be used for the missed restatement of a qualified plan."

Hiya Folks! The simple answer is yes. However, it ceases to be a 412(e)(3) plan at that very moment; it becomes a regular old DB Plan, with all of the minimum funding rules, Fiduciary rules, tax rules, compliance rules, etc. You would probably need a new Plan Document at that moment, too. As an aside, I rarely find one of these plans that is compliant, and this is a good chance to bring it into compliance, assuming the client will pay for what a DB Plan costs when someone is actually doing the work.

Most people don't understand 412i/412 e3 plans. They are DB Plans that are exempt from an actuarial val and a 5500 while they are a e3 plan, if they are set up properly to begin with. Assuming yours was set up properly in 2014 (maybe?), then it stopped being a e3 Plan the day that the premium payment is missed. So right then, you needed a val. If the val said you missed your minimum funding for the Plan Year, then you pay the excise tax and put the deficiency on the Schedule SB that you will submit for a regular old DB plan, which it has now become. So you didn't freeze your regular old DB Plan until 2018. You should be looking at preparing all those past 5500s and 5330s and get a fidelity bond. If you bring this case to EPCRS, you can propose ways to fund the NHCEs so you can terminate the Plan. You might want to consider asking for disqualification instead, it may be cheaper given the fees and the back contributions. Please have a good actuary take a look and give you a recommendation.