Jakyasar

Very interesting but mine does not have that provision, I will ask the vendor anyway. Even if it did, I am not sure if it would work in my case. The employees entered the plan as an non-HCE and then became but lookback year method although no other entered the plan ever. So, by definition of any HCE, if a husband and wife plan, if one terminates and wants a payout, I still have to perform 110% test? Wow

Surprising to use for a plan covering HCEs only. I agree with the other 2 points.

Hi This is first for me and want to check if test is needed. DB plan covering 1 owner HCE and one non-owner HCE. 2021 AFTAP is certified at 165% so no issues there. The non-owner HCE is terminated a month ago and accrued a benefit for 2021. Do I need to check for 110% liability test? I do not think so? If yes, I will add FT to TNC and possibly use 430 rates. Is it ok to use ARPA-21 rates to test, if necessary? Owner is ok with whatever rate that would allow the non-owner HCE to be paid out. Thanks

Ok, actuary now agrees with me and also the valuation system does not recognize it where I have to manually adjust.

I agree with you. No suggestions so far. I am trying to understand if the software has an issue. I will continue to pursue this. Plan covers only husband and wife I.e. only HCEs and key. Thank you

Hi Having a brain freeze for a change. I have not had the following situation for many many moons. Also having a discussion with an actuary. DB plan, covering husband and wife, both HCE and both key. Both way past NRA/NRD and in their 70s. Both are at 100% of pay and fully accrued in prior years. Low average salaries, in the 30k range. My software tells me that I am failing 401a26 and actuary agrees. I tried to use accrued-to-date method but the software does not allow me to do so. I was told that for 401a26 to use accrued to date, plan must satisfy 410b. What am i missing/not seeing here, sorry cannot think straight today. Thanks

A curious statement "IF the employee is paying social security tax then they would in fact be able to participate". Excuse my ignorance but how can they pay social security tax if the income is not US based? Not an expert, just thinking out loud. Peter asked the right questions. I had employees living oversees and being paid from US company (they were not US citizens) and they had to be included. May be not the same situation as yours?

Can you pass 410b utilizing average benefit test approach by increasing contributions to participants of A which would be done under 11-g correction? As A filed their return without any extension (and so did B), deductible for 2021. Also, which option for correction methodology was selected on FTW document, custom or based on the document provisions? Assuming that it can be corrected by VCP, can it be done by 10/15/2021 deadline (not sure if any deadlines imposed for VCP correction before a deadline)? Sorry if I missed these comments/suggestions and not being viable. Thinking out loud and curious.

Gilmore, depending on the vendor, you may get a different response from different document providers, as I experienced with my various communications with them. I for one believe in full restatement but that is me. I am curious what others will say.

Too many issues here. The penalty for 101j notice itself, which I assume was not provided, is going to cost quite a bundle. Hopefully no distributions were made which is another issue as no AFTAP i.e. less than 60%. If no SB's done, may have serious funding issues as well. And the list goes on.

Thank you Bill, hope all is well.

Hi I just did the calculations and the participant gets $3.25. They will make the deposit into the account for late deposits. @15%, the penalty is 49 cents. Is there any requirement to file 5330? This seems so ridiculous.

Agree with Belgarath and CB . Upon audit, far too many issues plus the monumental dollar amount for penalty instead of $750. The client would blame me if I took the practical approach. Thank you all for your input.

Hi Bird, I for one do not agree with your approach, sorry. Kind of agree though cannot do on corporate extension. Will see if other opinions. Thank you,

Hi Just curious about the following: Calendar plan, final distribution done in November 2020 i.e. final 5500 form is due 6/30/2021. So a short plan year. I was just told about this today which means 5558 was not filed timely. The sponsor is a calendar C-corp which went on extension for the 2020 filing. So the due date of the 2020 corporate tax return is extended to 10/15/2021. Can the sponsor rely on this automatic extension and file the final 5500 forms by 9/15/2021 - extended due date for a November filing? Or it has to be thru DFVCP? The following condition from the instructions may not make it possible: (1) the plan year and the employer’s tax year are the same. Your comments are appreciated. Thank you

The plan is all hce's and family members. All assets in a pooled account. Really appreciate your input. I actually did the higher of the 2 for loss earnings. Thank you

Currently in money market so close to 0%. Was not invested as of date of deposit, money market.

0%, brand new plan

Ah, big difference. A follow up question as I am more a practical approach person. First year of the plan is 2020. Let's assume $20,000 was due on 12/31/2020 as the deferrals and not deposited till 5/31/2021. This was the only deferral for 2020 so no returns on investment during 2020. If I used the VFCP calculator, the lost interest is $500 (making up), payable by 7/15/2021. So, for 2020, what is the sponsor's responsibility for lost of interest and any penalties, in dollars? Thank you

Hi Bri Thank you so much for your input and helping out.

Hi My first one ever. Need input from 401k gurus out there. Scenario 1: One deposit made 3 months late. Did the VCFP calculations. They made the deposit for lost earnings today. Correction under 4975(a). Preparing 5330. Completing Sch C Item 1 is discrete, correct? Completed item 2-a-1-i - date of transaction is when they deposited the missing deferrals, correct? Item 3 is fine Item 4, checked yes Do I need to complete item 5? It is the filer/sponsor listed on page 1, items A & D ----------------------------------------- Scenario 2: This time I have 20 late deposits, 4 participants, 5 different deposit dates. They will write one check i.e. all corrective amounts will be done in one day. I think put in 5 "transaction dates" and put in the appropriate lost earnings for each transaction date, correct? Again, do i need to complete item 5? If yes, do I need to put in 5 times? Did I miss anything else or not asking correctly? Thank you for helping out.

Hi Mike No filing for 2020 or 2021?

I vote SF too. Once you have the participant in the plan, you should report 1 terminated participant during the year with less than 100% vested. Same question in EZ as well but in my opinion, plan is not eligible for EZ. The question I have is what will happen in 2021 when the plan is eligible only for EZ filing and the assets are under 250K? Hmmm

Hi Thanks for your response especially on the expansion of compensation definitions. In my many years, I have never used anything other than job categories (almost never needed to). In few occasions used names but made sure that always passed ratio test. These new exclusions are new for me. I know not to use age related inclusions/exclusions. Thank you again.

Hi Having a discussion with an agent about a category exclusion. I never use it this way but may need to for an illustration. Concerned about BRF issues. Please consider the following 3 possible scenarios: Any eligible employee who is a salesperson and hired on or after 1/1/2015 shall be excluded or Any eligible employee who is a salesperson and making $75,000 or more annually shall be excluded or Any eligible employee who is a salesperson making $75,000 or more annually and also employed on or after 1/1/2015 shall be excluded Are any of the above an issue for BRF purposes? Thank you