Jakyasar

Perfect and thank you

Hi A hypothetical question. Please ignore any testing other than deduction. Assume a DB/DC combo plan. DC is 401k deferral and profit sharing only. Plans are not top heavy and also not covered by PBGC. In the DC plan, have a bunch on HCE's deferring only. To determine the 6% limit (or 31% combo limit), are the HCE's compensation included? One scenario, include them in the DB and another scenario, exclude them from DB. Thank you

Thank you all

Why the 5330 tax? I believe it is Title I but let's see what others will say.

I know it is a stupid question but any takers?

All noted and thank you.

Ok, then what is a reasonable deposit time, assuming cannot be done automatically and requires personal signatures from the sponsor? Just curious on what can be considered a safe harbor in a situation like this? Thank you

Hi Not a 401k expert. I know of only 7 biz days as a safe harbor deposit dates for any deferrals. Looking at a plan where I am told that they only can make one deposit per month i.e. their explanation for "administratively feasible" deposit. The owner travels a lot. The payroll is every 2 weeks. Is this reasonable? I do not think so but wanted to check. It is a small plan with 3 participants. 2 HCE's (owner and spouse) and one non-HCE Thanks

Hi A 401k plan covering owner/spouse and their children. All HCE/key. All receive one paycheck end of year. They received the 2020 salaries end of December 2020 with the deferrals reflected on them. Just found out that, they are depositing the deferrals now. Do they need the VFCP adjustment? I think they do as I see no exception but not a 401k expert. Thank you

Hi C.B. Right on the point as gateway is provided without regard to any allocation requirement under profit sharing requirements. Thank you

Hi Not thinking straight. DB/DC combo - top heavy plans. DC is 3% non-elective safe harbor, PS requires 1000 hours+last day rule DB required 1000 hours for accrual Top heavy requirement is under the DC plan i.e. DB is not required. Gateway is 7.5% i.e. 3% of safe harbor plus 4.5% of PS Participant works 750 hours during the year and employed as of end of year. Does not get a DB accrual though covered. Needs to get 4.5% of PS as must satisfy gateway, correct? Thanks

Thank you for clarifying.

Mike, did you mean NHCE or non-key I read no keys (e)(1)(E)? This is from IRC 420. Just curious. Thank you

No, DB did not have 401(h), this just came up. They need to shut down the plan as funding is going to be an issue soon. At this time, the overfunded portion is small so trying to take advantage of it before becomes larger. Mike, thank you for your comment.

Hi I was asked the following: Terminating overfunded defined benefit plan (DB) - small plan covering husband&wife - both over age 72). Overfunded portion will be rolled over into a QRP - just a profit sharing plan (PS) Can they pay their retiree medical benefit directly from the overfunded portion? I never heard of but.. Thank you

Hi There is always a first time. Husband&wife (owner and spouse - no other employee) - Virginia sub-s corporation, investment advisors Just found out that, they may have deposited over 6% of profit sharing limit during 2020 (not in 2021). The 31% test does not work as it is a large CB contribution. 6% PS was supposed to be 34k but possibly put in 50k during 2020 thus 16k overage. This is separate than the 401k deferrals. CB was 300k 31% limit is 176k If they made the excess 16k PS contribution during 2020, can they simply pay 10% excess tax and still take 334k deduction? What other solution(s) can be recommended? Thank you

Much appreciated and thank you.

Hi I have not had an overfunded DB plan PBGC termination in many many years. The excess is to be reverted to the employer under the provisions plan document, always have been from adoption date which is 2007. There is also a resolution that the excess will be transferred to qualified replacement plan - QRP. 100% of the excess will be transferred to QRP and all participants in the db plan are actively participating in the QRP. Excess is estimated at 300k. PBGC form 500, line 16a to 17c is where I am having a bit brain freeze to complete. I would appreciate if someone with this experience can share their knowledge. Thank you

Also, Schedule SB's still require wet signatures?

I agree with both, just need to convince others. Thank you both for your input.

Having a discussion (nicely put) that the following DC plan needs a fidelity bond - at least I insist on it: Owner (100%), spouse and 2 adult children. Am I wrong? On the top of your head, do you have a cite for it? Thank you

Best wishes on your retirement, enjoy. Thank you for all your input, always valued and appreciated.

Thank you, appreciate your quick response.

Hi Having a brain freeze as I have not had a low pay out for quite sometime. Is the relative value disclosure required for a lump sum under 5k (over 1k) and if yes, do I need to show the monthly benefit equivalences? Thank you

100% in agreement