DDB BN

This is the definition in the document: In the absence of any other designation, the Participant will be deemed to have designated the following Beneficiaries in the following order: (1) the Participant's Spouse, if then living; (2) the Participant's issue, per stirpes; (3) the Participant’s estate. No Beneficiary named hereunder will have any rights granted to Beneficiaries under the terms of the Plan until the death of the Participant.

1 person owner only plan. The 1st RMD was distributed in 2024. The Owner died in September 2025 and did not have a named beneficiary in the plan. He was never married and did not have children, therefore, his death benefit will be payable to his Estate. The Attorney and Financial Advisor want the funds distributed to his "Estate Beneficiary IRA account" as his IRA funds will be transferred here as well. The funds would then be distributed to the beneficiaries of his Estate to an inherited IRA. I have never heard of this. Wouldn't the funds have to be distributed to his Estate subject to income tax?

Thank you. We are using our Adoption Agreement so there is no issue with the structure. We just wanted to confirm that one document for the Adopting entities would be fine and there is no need for 2 documents / 2 separate plans.

Wife has an LLC with no employees. Husband has an LLC with no employees. Both own 100% of their own LLCs. The Wife's LLC pays the Husband's LLC. It is not clear if the Husband has any other source of income in his LLC. They both would like to set up a solo 401k plan. Do they need 2 separate plans or could both LLCs adopt the plan and only set up one plan?

No, the bonus check will be issued on 12/31

We are working on the document now and should be signed by Friday the latest and the Advisor can set up the accounts within a day of the document being signed. So it is a rush but appears that it can be done.

Thank you!

So they can set up the plan before year end and make deferral contributions from a year end bonus for 2025?

Received a call from an Advisor. He has a prospect with 2 Partners, no employees. It is an LLC taxed as an S Corp and the 2 partners receive W-2 income. The Advisor and CPA want to set up the plan for 2025 and have the partners make the maximum deferrals before year end from a bonus check. The plan can be set up for 2025 but can they make the employee deferral contributions at this late date for the 2025 year? I question it because they take W-2 comp and not Schedule C or K-1.

Thank you.

The employee earned non-union and union compensation from one employer. His W-2 from the one employer includes both non-union and union compensation. He did not receive any compensation from the other employer in 2025.

There are 2 Corps in the controlled group. Employees of both Corporations receive union and non-union income. The W-2 they receive each year includes both and we back out the union comp for calculation of the SHM.

Plan Sponsor has non-union and union compensated employees. Union compensation is excluded from the plan. One of the employees will have W-2 FICA wages of about $70,000 in non-union compensation for 2025 and W-2 FICA wages in union compensation of about $125,000 for 2025. Is the union compensation included to determine if the employee's compensation is over $150,000 for Roth catch up for 2026?

What about LLC Members in an Owner only plan? They have combo CB/401k plans and will not know what their net LLC income will be until much later in the year. Since the CB/401k PS contributions are backed out we have no way of knowing how much can be contributed as Voluntary after-tax to convert to Roth until the CPA calculates the net LLC income and the Actuary calculates the CB contribution.

401k PS plan. The Owner and his wife are going through a divorce which has been ongoing since last year. It is a nasty divorce scenario and may go on for another year or so. The Owner and his wife both have an account in the 401k plan. The wife terminated employment last year and is requesting a partial distribution now to pay her Attorney's fees. We received the request to approve her partial distribution. Since we are aware of the impending divorce since last year, we informed all parties that a QDRO is be prepared for both the Owner and his wife's benefits. The Attorneys on both sides indicated that the QDRO is not necessary as the Owner said it was okay for his soon to be ex-wife to take the distribution. I am not in agreement with this. There is nothing in the QDRO procedure in the plan document that addresses this issue. Can this distribution be processed without a QDRO?