Jakyasar

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

If I may ask one more question - hopefully not exceeding my daily quota. Changing the scenario, let's assume John did not work for the past 5+ years at all i.e. terminated. Would he still be considered an employee? Rule of parity rules are a bit confusing for me. Thank you

Yes and thank you, much appreciated

Hi Mike I hope the following is a more simplified way. I tried to provide as much information about the facts and my thoughts. In my many years, this is the first time I came across a situation like this and a bit puzzled. Facts: Newly established db plan 7/1/2020 to 6/30/2021. Same sponsor had a db plan that terminated 10+ years ago. The owner's spouse – John - was an employee and also a participant in the old db plan. I believe the sponsor was owned by John's parents in the past and now owned by John's wife. Never got a clear response on this. John continually works for the sponsor however stopped taking any salaries for the past 10 years. John works between 501-1000+ hours each year for the past 10 years They want to include him in the new plan and he will receive a salary by 6/30/2021 Questions: Does the plan need a special eligibility amendment to have him included as of 6/30/2021 i.e. waiving the 1 year wait? As he had nonforfeitable rights in the old db plan does rule of parity play a role here? John was paid out his 100% vested accrued benefit (lump sum form) Thank you

Hi Need to refresh memory. Looking at a combo plans (DC+CB). Plans are top heavy and top heavy benefits are provided in the DC plan only. Not my typical way of designing. CB has 1000+ hour requirement for pay credit DC has 401k + 3% non-elective safe harbor + profit sharing. Profit sharing portion has no hour requirement but has last day rule. Gateway is 7.5% i.e. 3% safe harbor + 4.5% profit sharing Have a participant (in both plans) terminated during the plan year with more than 1000 hours of service, however not employed at end of year. The participant gets CB pay credit, the minimum to satisfy 401a26. The participant gets 3% mandatory safe harbor. What else does he get? Additional 2% profit sharing for top-heavy (it is 5%) or full 4.5% profit sharing for gateway? Whichever he gets, I think i need 11-g, correct? Thank you

Hi Since the issue just came up again, wanted to follow up and see if any comments? Thank you

A follow up question, sorry if discussed before If I am electing to use any of the ARPA-21 provisions for funding/AFTAP/amortization for 2020, do I need to attached an addendum to the Schedule SB for 2020? For example, I used the 15 year amortization for 2020 for a brand new plan. SB, line 41a has reference to PRA 2010 only. Another example, I have an election to switch to ARPA-21 for funding for an old plan. Thank you

Why can't you say "Any HCE who is not a shareholder of the corporation is excluded". If any other type of entity, like partnership or sole proprietorship, you should be able to tweak the language. As SSRRS mentioned, some documents have the "other" language permitted but I would still check with the provider for the validity of the language. If multiple owners, you may be able to tweak by adding a majority or minority owner (with some additional proper language). If cannot be done that way, name should work but need to check with your document provider and make sure it is ok i.e. the additional language will still keep the plan in "pre-approved" status. Using names may also force you to pass ratio test

Much appreciated and thank you

Hi A young employee is a full-time employee for couple of years under "student visa". Is it reasonable to exclude under "anyone who is on a student visa is excluded". He is also a non-resident alien which is standard exclusion in my documents. Unfortunately, must be included in all tests due to full-time status which US based income, at least they way I know. Thank you

I agree with Bill, run away. However, if and when you hear from ABCD, if appropriate, could you please share what they will say? Good luck

Thank you

Because I want to start with 15 from the beginning and not worry about later changes. Thank you.

Hi I need to confirm the following as per my understanding. Looking into a 2020 db plan design with providing prior year service. Plan has a minimum required contribution (MRC) based on amortization of funding target. Not worried about MRC as they want to maximize contribution. Per law, 15 year amortization is effective for plan years beginning after 12/31/21 with an option of election for 3 prior years. I am thinking to elect to have 15 year amortization starting with 2020 plan year and also have the sponsor to adopt the election (election is required to adopt 15 years, as per my understanding). Am I missing anything here? Thank you,

I had a discussion about item 4 with a TPA who stated that not all sections to be completed in 4, just what is corrected? Any comments? I believe all have to completed no matter what the correction is. I agree that 4 should be completed. Sometimes did not matter as in the past Clients received letters from the IRS asking about where the filing was with the uncorrected info. 4 was clearly reflecting the corrected info. Thanks

Hi I am no expert on 8955-SSA but was having a discussion with a TPA. Whenever there is a termination of a participant and the participant is not paid out by the end of the plan year following termination, I file 8955-SSA, regardless of plan type. I have always known this way. The discussion is about the "deferred benefit" which the TPA stated that is only applicable when the benefit/account balance is not due till NRA i.e. plan does not pay benefits till NRA. Also, TPA stated that if only a 401k/safe harbor plan, does not need to file 8955-SSA (all benefits are 100% vested at all time). Is this correct per instructions "Plan administrators of plans subject to the vesting standards of section 203 of ERISA must file Form 8955-SSA."? Are there any situations where 8955-SSA is not required to be filed for any qualified DC and/or DB plans? Let's leave 403b plans out and this is a question for DC or DB plans. Terminated participants may have partial or full vested benefits. Does it matter if the DC plan is a money purchase plan or a profit sharing plan where the normal form is J&S? What am I missing here? Thank you

ESOP guy - interesting case. Do you remember where in Sal's book this reference was? As Gilmore stated, your situation is different than mine but I still would be interested as to how they were not participants at BOY when they were retroactively, just curious. I never use retro to beginning of year.