MBCarey

We are tryng to update the document for a Money Purchase Pension Plan - Individually Designed. The plan requires a mandatory deferral of 1.5% to be eligible for the 1.5% of match. Does the ACP test have to be run on the match piece? Also Corbels checklist rfers "Plan Year Switch" for Eligibility Service. Can someone explain this to me> mbc

John, thanks so much for your help. One last "dumb" question. Because all investments in this plan are direct participant direction, do I have to do any reporting under the 5% Excess question? mb

John, I guess I can break it out since I did break it out when listing assets in Part 1. Would I then put its gains and losses under the Line C Other Income and then list it separately on the schedule for Line J or Line J apply? I am assuming I have to answer yes to Line J and then list the assets?

John, thanks for getting back to me. Will try to stop bothering you after this. In completing the Schedule H, this is what I have done: 1) Income - Completed Line (4) a - Total Proceeds from Sale of Assets in Brokerage accounts (4)b Value of Sold Assets at Beg Yr. plus total purchases for year (4) c is the result 2) Line(5)(B) - unrealized gain/loss on brokerage accounts 3) Line (7) total assets is PSA 4) Line (10) total assets in Reg. Inv. Companies. (Ltd. Partnerships belong to only one participant and are maybe 1% of his total account balance - so they were lumped with all other part. directed brokerage money What do you think. Have I broken it down too much Mb

John, yes I am referring to self directed brokerage accounts there are about 15. So I can just put the total brokerage assets on the one line together and report the g/l on one line with the exception of loans and Ltd. Partnerships (which there is one loan and two limited partnerships within the brokerage accounts. The remaining assets for the other participants are held at ING in Pooled Separate accounts which I should report on the appropriate line. Also, when it refers to unrealized g/l should I report the value in the Brokerage accounts only. Am I right in assuming that with the Pooled Separate accounts there is no unrealized gain only with stocks that are sold? mbc

John, thanks for replying. I think I understand what you are saying. In regards to the brokerage accounts, I should use the ending value of the o/s assets less the beginning value to get vlaue for 2(B)4© - net gain/loss, unrealized g/l goes on line 5(B), investmens from PSA (ING assets) on Line 7. Please correct me if I am wrong. I have done a spread sheet for the brokerage accounts to calculate the g/l and unrealized g/l. Can you also tell me if when reporting the assets in the o/S brokerage accounts do I need to report the Money Market Value separately in Section 1 line c1 or is that just for reporting general assets of the plan? Mbc

Can anyone help me understand how net gain/loss for SChedule H Part II 4a,b,c are calculated. I have outside brokerage accounts that I have calculated realized and unrealized gains and losses for. Is that the number they are looking for? The instructions say something about the beginning, the value sold and the ending. I use a spreadsheet to calculate these individually and only have a total number for realized and unrealized gains. Unrealized I have reported on (5)(B). This is my first time doing a 5500 for this plan with o/s brokerage accounts and I am really confused. I posted before about this and received a response, but I am still confused. Thanks

Thanks for continue to help me. The ltd. partnerships only amount to a little over $35,000 for two individuals with assets in excess of $400,000 in the plan combined. When I prepare the additional schedule for 4i to attach, would I list the assets held in Mutual Funds, the total Outside Brokerage Account balance, and break down the two ltd. partnerships? I am sorry if I sound like an idiot, but this is the first "new form 5500" I have ever done and have not had to do a long form at all for quite some time. Only have small plans except for this one. Thanks for your response Marybeth

Thanks for your reply. I see by the instructions where I can aggregate the two different sources, but it also refers to Schedules in 4i that should be completed if there are limited partnerships involved. I am not sure what they are looking for. This is the first year that this plan has had to do a Long 5500. In the past they just reported the ltd. partnerships on the Schedule I in Section 3a. Are the schedules referred to in 4j of the schedule H applicable? If so, would you report all assets on a separate schedule? Marybeth

How are self directed brokerage account balances reported on the Schedule H? Should I breakout ltd. partnerships, money market and cash accounts and then combine the monies in the registered investment companies with the other assets which are held at ING?

My firm just took over a plan from an accounting firm who always did their own 5500's. One the Schedule T, they checked Box 3(d) indicating that all nonexcludable employees benefit. The document has a last day rule on both the Match and Discretionary PS. Although when testing the 401(k) piece is 100%, but the 401(m) and the profit sharing piece are not. Had I done the 5500 in the past I would not have applied the exceptions and completed the entire form. Am I crazy? Marybeth

We have a client who would like for the document restatement charges to be paid from participant accounts? Marybeth

A while back I remember the DOL issuing guidance on fees that could be deducted from participant accounts and fees that could not. Can anyone tell me how and where to find this?

Blinky, There are two plans with two adoption agreements.... I used the testing for both plans together for the Schedule T? But am filing two 5500's. I hope this is the correct methodology. mb

I have an client who owns two companies and are hwat is called a Limited Liability Company part of a controlled group. There are two separate documents that are identical to each other with the exception of the effective date (one company has always had a plan and the other just started one). For testing purposes, I tested the employees together (less than 20 employees combined). Is this the correct thing to do? And, should there be one 5500 or two? Thanks

When I took over here, several of the plans had individual life policies owned by the Plan. I was told that the cash value, although included in the valuation each year, was not reported as part of the ending value on the 5500. I have been consistent in not including this in the total assets for the plans where it had not been reported on previous filings. Is this correct or not. Marybeth

This is kind of a strange Question, but any wisdom is appreciated. In a Simple 401(k) plan, do the owners have to give theirselves the mandatory match. I have two owners who don't really want to match their deferrals? Strange.. Marybeth

Can someone tell me if a defaulted loan which has been treated as a deemed distribution with applicable taxes withheld at actual distribution to the participant of account balance be reported on Schedule I Question 2 g.

Thanks.... However, I think I will not even think about, let alone pass along your last funny or 183 entry dates. Have a good weekend. Marybeth

Tom, I hadn't really considered the scenario you gave. But I do see you point. Can you explain to me the Max. one year to participant in 401(k) plan. The way I read it is that I can only make an employee wait one year to be eligible to make deferrals, but can set up eligibility so that the would have to wait 18 months or 2 years to receive a match. Is this true. Marybeth

I was recently in a corbel seminar and a section of the materials that we were given has a questions and answer and one was on Eligibility which says: Max of one year eligibility. A 401(k) plan may not require the employee to complete more than one year of service (as determined by Code 401(a)(1) but without retard to the two year rule of Code 410(a)(l)(B)(i) to participate in a 401(k) arrangement. I have a couple plans with an 18 month eligibility. Or entry based on the first six months entering on the beginning of the current year in which requirements were met or if met in the last 6 months enterning on the ist day of the following plan year. Does the statement above mean that I will have to let allow participants who complete a year of service to begin making deferrals immediately.

Is there any new rule in a 401(k) plan that says you have to have immediate eligibility for deferrals even if the wait for match is one year? I don't think so, but I am starting to doubt my knowledge.

Are there any regulations against allowing a terminated employee to continue to make loan repayments if no distribution is taken from the plan.

Thanks to both of you for now. I think you have helped to clear things up in this mixed up brain. First, I will make sure that TH is satisfied. I will check the document for sure, but I do not beleive the keys received a TH allocation. Then with the remaining amount allocate the profit sharing contribution with the Gateway coming into play. I think this may be what I have done, but I did not take into consideration that the match the HC's received was at 3%. Instead I was trying to spread only the 2.34% as a Top Heavy contribution....... Thanks for your patience, I know I am very confused...

The HC with the highest percentage is getting 3% match + 2.34% overall profit sharing contribution. The lowest NHC is getting 3.00% match +.77% profit sharing. The participant who did not defer is getting a 2.34% TH plus .77% profit sharing. This just does not sit right with me. I am sure I am missing something. Since the HC's are all receiving the 3% match, does that mean that my TH contribution has to be at least4% and not the 2.34% that the HC's are getting as a profit share.