Jakyasar

It is covered by PBGC and this is why I was curious on reallocation compliance you were referring to. can you elaborate please? Thank you for your other comments.

Plan document says allocate to the participants Does the proposed reallocation comply with the PBGC rules? - Not sure what you are referring to? Does the proposed reallocation pass IRS nondiscrimination testing? - No method has been determined on but possibly 1% standard formula. No submission for DL for termination that I am told. Thanks

Not my plan but having a discussion about it. Offset DB plan terminated. Due to offset, out of 20 participants, only 2 owners have benefits. all others' benefits are offset by DC plan. Document states, excess is allocated to the plan participants. Questions raised and discussed (asking them as they are): Assuming the excess to be allocated to the participants, do all need to get an allocation? If yes, can there be any offset? Do both owners need to get an allocation or is it possible to give only one owner the additional allocation? Neither owner is at 415 limit. Can a qualified replacement plan (QRP) be set up now, plan provisions be amended for reversion to employer and excess transferred to it? Provisions have been around for more than 5 years. Any other suggestions?

Just saying "yes" in an email should not be enough (nor a proper authorization) as they need to sign a proper form with proper language/declaration permitting your company (not you personally) to file. One of the important declarations is "I understand my signature is available for public viewing" - (for non-ez plans). You want all this on the form that they sign. Every vendor has their own way of providing the esigner form so please look at yours and see what language they have. I would never file on behalf of a client with a "yes" in an email. I want that form signed/dated allowing my firm to file on their behalf but that's me.

If 100X fails, try RR 74-307 rule but keep in mind that it is based on years of participation only, cannot use years of service. When determining the lump sum for 74-307, 415 limit should be adhered to i.e. do not base the lump sum based on a very high mortality table that exceeds 415 lump sum at NRA. This lump sum is based on projected monthly benefit at NRA which can change from year to year. If you continuously reduce the benefits and/or freeze the plan, you will need to recalculate the insurance coverage and make sure that incidental limits are not exceeded. When applying RR 74-307, do not forget the 66.66% rule for whole life and 33.33% for universal/term life. You can certainly flip flop using 100x or RR 74-307, no requirement that it has to be the same method to check. However, as always, please check the plan document language and see what is allowed and what is not. My 2 cents FWIW. FYI, I hate insurance in any pension plan, nothing but trouble and never explained by agents properly and what the consequences are, what do I know.

I love them both but I wish that EOB would have a better search engine. Something I discussed with Sal a long time ago but unfortunately it was not in hands to fix, it was the publisher. Still an issue and not intuitive, may be it is me but I hear from others as well. EOB is far more technical and full of examples, when you can manage to find what you are looking for. ERISApedia has a great layout of the law and sections but you have to pay for all separately which can add up quickly especially if one is on budget. still very well explained and in layman terms. The new DB section is also very good. Just my 2 cents

Hi Bill Thank you. All the best

Hi S-corp has 50/50 2 shareholders - unrelated to each other and no other employees From 2024 EZ instructions Covers only one or more partners (or partners and their spouses) in a business partnership (treating 2% shareholder of an S corporation, as defined in IRC §1372(b), as a partner) Looks like 5500-EZ can be filed, correct?

Hi John Match is over 3% of salary. Thank you for your input.

Combo plan CB/DC DC has SH match (not nonelective 3%) HCE (not owner) is excluded from CB plan. Defers and gets SH match. DC satisfies TH and states only TH with no percentages. HCE TH is satisfied without additional 3% PS allocation, correct? Thanks in advance

Hi Just picked up a PBGC audit for the first time well in over 10 years. Any new developments/things/pointers anyone with recent experience can share? Thanks

I agree with you about the language. DC doc does not state 5% and it also states "for a non-frozen DB plan", it is not required unless 5% is indicated (FIS doc) So, I take it, from what I read and above, for a frozen DB plan i.e. no one accrues a benefit, 3% is the top-heavy. It also states, for all participating in the DC plan only (there are exclusions for DB plan), top heavy is 3%.

Combo plan, top heavy and top heavy provided by DC plan. DC plan has 3% non-elective SH DB frozen but a class of employees are excluded. There will be no =accrual for 2025. The document states TH is provided by DC and nothing else. What is the TH requirement for 2025? 3%?

Isn't fresh start a law for conversions?

No you do not but it was done by mistake by someone.

Hi 2019 5500-EZ was filed with less than 250k in assets -first year of the plan/filing but stopped filing in subsequent years and assets are still under 250k. Was there a continuation requirement because initially it was filed? Thanks

Thank you all for your comments

So the fact that there is no CG does not eliminate the combined 415 limit?

Corey, it is the same line of biz and it is a successor biz. No issue on the CG, agreed.

I own company a 100% and had a DB plan which terminated. I started a new company and now own only 50% and want to start a DB plan. Same line of business. Does my old DB offset my new DB?

Very slow brain activity day Plan fails 401a26 and need 4 additional participants. Want to keep the cheapest options, surprise! Bringing in 3 eligible but categorically excluded. There are a few others in this category but they would be costly to bring in for 401a26. 4th one is a not yet eligible employee i.e. not yet completed 21/1 requirement but really cheap solution. Any problem bringing in the 4th candidate by 11-g rather than utilizing other already eligible and categorically excluded employees?

ASG has 3 plans. 1 plan never had a key employee and not top heavy - Plan X The other 2 plans are top heavy and provide top heavy allocation. Is Plan X required to be part of the aggregation and receive top heavy allocation?

Once you activate the plan, make sure to exclude any increase attributable to the HCE's for the cushion calculations. Otherwise, the statements from Effen and Bill are correct.

That's the reason I am thinking of having the tipping not excluded. The sponsor may not have the correct data on the tipping part but cannot argue with the full w2/payroll records. The purpose is not to increase the benefits necessarily but to avoid getting incorrect compensation data especially if the records are not kept properly thus not exclude them for sketch records. @Lou S.No AFTAP issues

It is for a DB plan and it will increase the benefits to all non-hces, nothing else.