PS

Hi, Plan sponsor is yet to start the termination process however they have questions regarding profit sharing and safe harbor. There is a balance of $3000 in the forfeiture account. Are they required to make a profit sharing contribution for 2025 plan year (10/30/2025 - or whatever date is prior to that for termination of the plan) They only had payroll for the month of December 2024- they are anticipating that the final 3% safe harbor for 2025 plan year would only be approx. $1500. is that true? They haven't determined the termination date yet.

Hi, Plan is terminating and the termination date is 07/31/2025. The Plan sponsor wants to do a annual employer match true -up contribution which usually occurs in Jan for the pervious year. They calculate the match throughout the year on a pay-check-by paycheck basis. 1) Since the plan is terminating I believe they should calculate and contribute to the plan for the period Jan 01-July 31 it will be for a short plan year correct? 2) Should they wait until next year to do the contribution or can they do the calculation now and contribute?

Hi, The plan termination date is 06/30/2025 however is it okay that the plan details report notes 12/31/2025 as the testing end date?

Hi, Terminating plan has a 3(12) agreement and the plan sponsor would like to know if they require to submit any special document to disable this service . I've never come across 3(21) agreement does the plan sponsor need to complete any special requirement?

Thank you

Hi, 8 participants had 415(C) excess since they already rolled the funds into the acquiring company plan the correction could not take place at the terminated plan. The new RK has sent a check payable to the terminated plan. Aren't 415 violation able to to be processed/returned from any plan or should we have the check deposited into the terminated plan and then cut a check to the participants ( excess amount)?

Hi, 8 participants had 415(C) excess since they already rolled the funds into the acquiring company plan the correction could not take place at the terminated plan. The new RK has sent a check payable to the terminated plan. Aren't 415 violation able to to be processed/returned from any plan or should we have the check deposited into the terminated plan and then cut a check to the participants ( excess amount)?

Can an employee make a deferral into the plan with money received as severance before the plan termination date or can it be made even after the termination date? Also, does the employer has to put in a match (Safe Harbor) on the severance pay?

Hi, Plan that is terminating the re-allocation of the forfeiture balance occurred after 180 days of the participants initial distribution, is it mandatory the participants should receive a second communication along with the special tax notice since the participants are receiving the additional money post 180 days of their initial distribution? Is there any resource of information can be shared in reference to the special tax notice?

They will need to have the amendment completed and then proceed with the plan termination or can they do this simultaneously? by when should they have the GFA completed? is there a deadline?

Hi, For plans that are terminating should the Plan sponsor complete the good faith amendment ( SECURE 2.0 and CARES)? what if they have not done the amendment? Thank you.

Thank you!

Hi, I have a plan situation one of the plan that got terminated back in 2021 has now received a small $ amount due to SDB earrings. Is it common to see SDB earrings getting posted into a terminated account? should these funds be even posted into a terminated plan? Also, since there is a posting of $83 into the terminated plan will the plan sponsor require to amended the 5500? Thank you.

We have received two plans for termination. One is PR qualified only and another one is a dual-qualified in US and PR. I'm a little confused on you next question it says 401k or 1081.01(e) isn't both the same or rather 1081.01(e) also known as 401(k)?. The dual-qualified plan does have 2 other DC plans however they are terminating the other two plan as well.

Hi, As per the new DOL regulatory the requirement for annuities has been loosed is there thing that can be shared what those requirements are? any DOL guidelines links that any one share?

Hi, I'm looking for some information on Invoice reimbursement, generally the balance in the forfeiture can be used to pay invoice and re-allocate to participants or even make employer contribution. Incase the Plan does not have invoice and they want to use the funds in the forfeiture to reimburse a pervious invoice that they paid I believe they can do it however should this be within 1 year of the payment or can it be anything up to 5-6 years? In reviewing the plan document I'm unable to find any information not sure if the plan document talks about this. Thanks

great! thank you.

My apologies! it's cross year tax correction. Terminating this plan really took a toll on us, nearly worked for 5 years in terminating this plan. After serval on and off situation the client decided to start the process, during the termination they made many changes and wanted to have it closed by 2023 and I believe that is where it went wrong because there were few deceased account which would HOLD the plan from being opened hence the client decided to direct to cut a check to the estate. I'm trying my best to find a way to see how this can be corrected and I appreciate all the help and guidance. Any section in IRS that can furnish more detail on the correction?

The plan sponsor directed to pay the estate. It was not exactly paid to the estate a check was just cut to the deceased estate, the spouse has reached out claiming for the benefits. Will this fall under form 945? because this is more of administration error.

The check is outstanding and the spouse has the check. Its a qualified retirement plan, we are trying to obtain the death certificate and the plan document states its spouse and estate incase there is no beneficiary form.

Looking for some help on cross tax plan correction. For one of the terminating plan the benefit was paid to estate however looks like there was a named beneficiary (spouse). The check was cut to the deceased estate in 2023 and the spouse reached out in Feb 2024, the spouse wants to rollover the funds to an IRA and wants the account to be made whole. Since we are in April is there any exceptional rules that we can use to have the tax corrected? the taxes withheld is $80000.

Any thoughts?

Hi, We received a DC 401k plan for termination in 2020, since they had filed for 5310 the termination was on HOLD. In 2022 they received a determination letter and was good to start the termination. The plan has 32 deceased participants the Plan termination notice was sent to the deceased address as well there was no response and since the named beneficiary did not respond with the sponsor's direction the check was cut to the estate. There was a tax deduction on $90,000 the check was cut in September 2023 and the spouse received the check and responded in Feb 2024. I'm looking for some guidance how the tax record can be corrected? also is there a 5 years payoff rule for deceased account?

Hi, As per the revised age for participants to receive RMD for those who reach age 72 after Dec. 31, 2022 and age 73 before Jan. 1, 2033, the RMD age would be 73. For terminating plans how should the RMD be handled? 1) Is the RMD processed based on the status? if the participant is terminated or retired should the RMD be processed? though they can be employed by the acquiring company or can the participant defer it. 2) The forced distribution to the unresponsive participants I believe the RMD should be processed first and then the full distribution should be processed. What in case if the RMD is not processed what would be the repercussion. Thank you.