Jakyasar

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

Bad reasoning😄 However, i agree with you, wanted to check out there. Thank you

Any takers please?

Oh, seen it many times, they never listen, always warn them about the IRS audit issues but what do I know?

In addition, if a partnership, the partners should not be getting any W-2's.

Terminating an overfunded db plan. Not relevant but 2 participants, owner/spouse. Each took a loan out from the db plan and first payment is due late March. Loan is for 50k/each Each will rollover their lump sum into their respective IRA's and loan will be rolled over into the qualified replacement plan (QRP) before first payment due. Do they need to redo the loan agreement in the name of the new QRP without changing the original provisions? Thank you

Still not clear if s-corp or partnership, big difference.

They want to include. It would have been required if adopted after year end, correct? I am still going to provide one, never hurts (famous last words)

Hi Did not have one of these in many years. Calendar plan. BOY valuation. Amendment to increase benefit adopted before 12/31/2020 but after 1/1/2020. Do they need to adopt some kind of amendment election? Thanks

Just so that it is clear, it should be 161,667 as acc-to-date is based on average?

What kind of an entity is the plan sponsor, a partnership or an s-corp?

Does anyone remember when they were asked this question?

Hi New plan was signed/adopted by 12/31/2020, sponsored by sole-proprietor aka husband. Now they want to add another sole-proprietor aka wife for 2020 as an adopting employer. Can this be done retroactively? Thanks

Thank you for the attached. Here is a question for a DB plan - out of curiosity as was just presented to me a few minutes ago. Plan requires 1000 hours for accrual and vesting. It is EOY val. Date of hire: 12/1/2018 Calendar 2019 worked over 1000 hours Date of participation: 1/1/2020 Date of termination: 3/31/2020 - 750 hours from 1/1/2020 to 3/31/2020 As of 3/31/2020 did not accrue any vesting service i.e. terminated with 0% vesting. Rehired 10/1/2020 and accrued another 500 hours of service for a total service in excess of 1000 hours for 2020. No Break-in-service. Language from the document - the box is not checked [ ] Rule of parity. If an Employee does not have any nonforfeitable right to the Accrued Benefit derived from Employer contributions, exclude eligibility service before a period of five (5) consecutive One-Year Breaks in Service/Periods of Severance. [ ] Rule of parity. If an Employee does not have any nonforfeitable right to the account balance derived from Employer contributions, exclude Years of Vesting Service earned before a period of five (5) consecutive One-Year Breaks in Service/Periods of Severance. The way I read this (might be totally wrong) since not checked, this participant continues to be active for 2020 and accrues a benefit and also vesting service. Your comments are appreciated.

Ooops, sorry, thank you for the correction. I must stop typing when I am doing 5 things. "Do not exclude key"

Thank you

Sorry if this was asked before: I own an S-Corp and own 100%. My adult son is my employee and participant. 2020 5500-EZ instructions for who can file EZ: 2. 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) 1372(b)2: (b)2-percent shareholder defined For purposes of this section, the term “2-percent shareholder” means any person who owns (or is considered as owning within the meaning of section 318) on any day during the taxable year of the S corporation more than 2 percent of the outstanding stock of such corporation or stock possessing more than 2 percent of the total combined voting power of all stock of such corporation. So, now I can file an EZ where my son owns my stock by attribution? Thank you for your comments

Not sure about the salaries and the minimum required contribution (MRC) for the db plan but did you look at the 31% rule? If the salaries are at maximum levels and the db plan MRC is not so high and also contributed after 12/31/2020, you may be ok, all facts and circumstances, just a thought.

How about if the plan is top heavy and the top heavy provisions in the plan do not exclude non-key? Grouping or not, unless categorically excluded, both the owner and the son gets 3% (assuming that they are both key). Of course, the contribution basis testing is a given.

Agreed with the 401k provisions being effective 2021.

Thank you both confirming my understanding.