RCK13

Thanks to you both for your suggestions! I'll check out those resources and see if my firm is willing to purchase them.

Thanks in advance for any guidance that can be offered on my questions. We have our first 403(b)(9) church plan with discretionary profit sharing that is allocated at a rate of 12% of comp per year. Is there any type of testing required? I know that because it's a 403(b), there's no ADP test and that Section 403(b)'s maintained by churches are not subject to the coverage and nondiscrimination testing rules and that it also isn't subject to the universal availability rule. However, I'm a little uncomfortable saying that NO TESTING needs to be done and I'm wondering if we should be testing comp limits, employer contributions, and for minimum contributions or if we have to test the profit sharing contribution at all. A few other questions I'm getting stuck on: do forfeitures need to be separately accounted for by person? Can church plans utilize auto-rollovers or cash out provisions? Thank you again to anyone with input

Thanks, Lou S. That makes sense.

We have a situation where a participant erroneously took their first RMD in 2020 because they met the old rule's requirement for RMDs rather than the new one. Is she required to continue taking an RMD annually even thought she isn't 72 yet? For reference: DOB: 4/1/1950, Retired 12/31/2019, Took RMD 2020. On the one hand, she isn't aged 72 yet (which is her RMD age), so I would think it's not necessary to continue her RMDs this year. But on the other hand, we haven't had a problem like this before so I figured I would see if others had any input. Thanks!

Thanks, Peter, for your advice!

Good afternoon everyone, We recently had a client express interest in qualified disaster distributions (QDD's) as they are allowable under the Consolidated Appropriations Act 2021 and prior law. I realize that these cannot be used if COVID is the only major disaster declared in the area. However, this client is in an area that experiences frequent and intense hurricanes, so I think they are good on the first prong below. A "qualified individual" is an individual: whose principal place of abode at any time during the incident period of any qualified disaster is located in the qualified disaster area with respect to such qualified disaster; and who has sustained an economic loss by reason of such qualified disaster. My question is surrounding what we, the TPA, would need to include on the form we provide to this client specific to proof. In certain distributions, we've required a showing of proof that the individual meets the requirements. I'm not sure if this can be treated like COVID distributions (CRD's) where they self certify, or if we need to include some other showing of proof that participants would be required to include in their submission for such a distribution. Wondering if anyone has thoughts on what type of proof a participant would need to submit for this type of distribution? Thanks in advance!

Thanks, Lou. Is that true even though there are hour and last day allocation requirements to the match? Is it deemed to pass because the match is for NHCE only?

Thanks for your response! I actually reached back out and asked my colleague (the account manager performing the testing) for more specifics surrounding her question to see if that would shed any light to the particular issue she is having (I'm relatively new to the industry, and this is my first testing season, so some of this stuff is still quite new to me and it turns out her question was less about TH and more specific to the match) She is asking if the match as stated above would take the plan out of safe harbor status and if that would then make it so that the plan had to test for top heavy? Because if the plan is taken out of safe harbor status and has to be tested, it will be top heavy and then minimums will be owed. Are you saying that the issue is moot because it has the 3% SH? Thanks!!

Facts: Plan is top-heavy; Has a 3% non-elective safe harbor contribution; Has a stated match of $0.25 for each dollar deferred up to 4% of pay for Non-HCE only – has last day/1000 hour requirement; Has a discretionary profit sharing plan, but has decided NOT to make a profit sharing contribution for 2020. I know if they make a profit sharing contribution (which they always have in the past) that they would need to satisfy top-heavy minimums, but in 2020 they are not going to make a profit sharing contribution. My question is if for 2020, do they have to satisfy the top-heavy minimums? I know that adding allocation req's to a match makes nondiscrimination more difficult to pass, but does the fact that the match is for non-HCE only help? Any insight you can provide would be much appreciated! Thanks!

@Belgarath There is a DB plan involved, and I've reached out to the actuary. This is a completely new plan so there is a lot of elements to iron out details on for this (and the yet to be created Cash Balance plan). Thank you for your responses, they helped point me in a good direction!!

My question is not really surrounding future employees, as they do not intend to ever have employees beyond the two owners. I'm more asking about how special participation dates work functionally within a plan. Because it is cross-tested, our actuary sent over his spec's and I just mirrored them on the 401(k), which then necessitates a special participation date. Do you think I could cut all that out and just leave it at immediate eligibility? Thanks for taking the time to reply.

Background: We have a brand new cross tested plan. For the 401(k) portion, the eligibility requirements are 21/ 1 YOS (1000 hours). However, the owners would like a special participation date for immediate participation for themselves (no employees in either adopter). This is a plan for two new adopting employers, and the business entities were established in 2019 and 2020 respectively. For one owner, he has been performing services and on payroll since 2019. For the other owner, he started performing services on 1/3 and will be on payroll 10/1 of this year. The document has a specified place for special participation dates, but I wasn't sure what the date should be. My question is when can this special participation date be? Does it follow with when they started performing services for the business entity or when they started on payroll? In other words, with an owner who has performed services 1/3, but not on payroll until 10/1, what special participation date would I need to use? Thanks!