metsfan026

Thanks everyone! Does anyone know what the cost is to do the registration through Puerto Rico (obviously there will be additional fees for the administration/filings), but the client is considering it and asking what the costs would be. Thanks in advance!

Does anyone know what's involved in getting a plan to become a dual-qualified plan so a person who lives in Puerto Rico could be eligible? Are there forms/fees involved in completing the process? It's something I've never done and I have a client that's looking to hire a Puerto Rican citizen and wants them to be able to participate. Thanks in advance!

I just wanted to make sure I was correct. Cash Balance Plan is terminating as of July 31, 2022. In order to calculate the 2022 requirement, they can maintain the 1,000 hour requirement correct?

I have a client who is terminating their Cash Balance Plan and wants to make their 2022 contributions based on the short plan year, so they can get the money paid out before the end of the year. Have the '22 segment rates been released as of yet? If not, is it OK to use the '21 rates? Thanks!

The problem is that the premiums weren't paid from within the Plan. The Plan isn't allowed to reimburse them and then make additional contributions? Any suggestions on how we solve the issue where premiums paid are in excess of the allowed Profit Sharing contributions for the year?

I'm taking over a client where there are two life insurance policies owned as Plan assets. Here is the issue, the premiums were paid outside of Plan assets. Normally we would use those payments as part of the contributions for the year, but the issue is that the premiums are actually in excess of the allowed contribution (plus the client also made an additional contribution in '22 for the '21 plan year). Would there be an issue in having the fund reimburse the owners who made the premium payments from outside the Plan? That way the premiums were paid by the Plan and the additional contribution could be made? I just wanted to make sure that this wouldn't create additional issues. Thanks in advance!

That's definitely not an issue here. So since it's a straight Profit Sharing Plan, technically it's not subject to QJSA and therefore it's not necessary. Is there a reason why they would want to maintain requiring spousal consent? Some members are pushing for the Trustees to remove that requirement.

That's what I meant. It's a Plan Document thing that the Plan can opt to remove

If a participant wants to take a distribution (either in-service or termination), is it an IRS requirement to get spousal consent or is it at the Plan's discretion?

I'm not pointing fingers, so hopefully it didn't come off like that. If they opt to return the money, do they have to make them whole for any investment loses?

I have a potential client who is having issues with 2021/2022 contributions. It appears that the prior TPA allowed ineligible participants to defer into the Plan. What is the normal procedure in this case? If the money is returned, does the employer have to make the employees whole if the investments are down?

I have a Cash Balance Plan that is about to terminate. The question is, which participants become 100% vested at termination? Obviously anyone who is currently active in the Plan becomes 100%. What about terminated, non-vested participants who have had less than a 5-year break in service (there are former employees who have anywhere from a 1-4 year break, but are not actively working)?

Does anyone have a sample 204(h) notice? I have a Cash Balance Plan terminating, so it is required to be sent 15 days prior to termination correct? Thanks in advance!

That's what I thought. Would there be an issue amending the plan, eliminating the benefit for the two owners but maintaining the contribution for the rank & file?

If a client opts to terminate their Cash Balance Plan prior to the end of '22, due to selling the business, is their a contribution obligation for '22? Just want to confirm so the client knows what to expect prior to termination. Thanks in advance!

That's what I thought, just wanted to confirm. Thanks!

I have a client who is looking to stop allowing loans as of 10/01/22 (any loans already taken will continue to be paid off). Is that an issue or can the "benefit" be taken away from a participant? Thanks everyone?

Thanks! Since we're using the contributions as receivable I'll also go ahead with the loan repayments as well.

Quick Question. Employer made the 12/31/21 loan repayments in early '22. Would these be included as a receivable to the Plan? We do take receivable contributions into account, so just wanted to make sure that loans were handled the same way and not on a cash basis. Thanks!

Good afternoon! Have a potential client that's looking to setup both a DC and DB Plan. No issue in that, but where they are looking to invest the money is asking for separate EIN # for each Plan. Is that normal? Just curious, as it's not something I've previously encountered. Thanks, and sorry for all the questions lately!

If a DC Plan wants to amend the Normal Retirement Age (i.e. for 55 to 65), is that an amendment that can be done mid-year or should it wait for the first of the year? The question is due to vesting, as the Plan states that they become 100% vested at Normal Retirement (which the previous TPA set at 55). The second question is, I know a change like this can't have a negative impact (like when you amend the vesting schedule). Does that mean that anyone who is currently employed must still become 100% vested once they reach 55, or can it impact anyone who has not yet reached NRA (if a current employee is 54 and they amend the NRA to 65, does that mean that participant has to wait until 65 or to work the necessary years). Thanks!

Good morning everyone. Just a quick question, our document software defaulted to add the following when we entered to exclude part-time employees: "Notwithstanding the foregoing, any Part-Time Employee who is excluded hereunder will nevertheless be considered an Eligible Employee if he or she is credited with at least 1,000 Hours of Service during any Eligibility Computation Period beginning on or after his or her Employment or Reemployment Commencement Date and is an Employee on the last day of such Eligibility Computation Period" Is there an issue with removing this language? They want to exclude all part-time employees, even if they ultimately work 1,000 hours in a year, and they definitely wouldn't have a testing issue. Thanks everyone!

I again apologize for all the questions, as I'm trying to learn and help out in my office. When we have a DC/DB combo plan, the 7.5% Gateway (I know it can be less than this, but generally is viewed as the "Safe Harbor" comes exclusively into the DC Plan correct? I just wanted to make sure. Thanks!

One of my clients got a letter about prohibited transactions and the opportunity to correct via the VFC program. This stems from the accountant marking on the Form 5500 that there were delinquent 401(k) contributions/loan repayments. We've gone through making everyone whole, with charging the employer interest on the late payments. My question is what's involved in responding to the VFC program? Is it simply a letter aknowledging the deficiency and outlining what has been done to: 1) Correct the past issue 2) Prove that steps have been taken to ensure it isn't repeated Or are there actual forms that need to be completed (similar to the VCP program)? This isn't something I've done before, so I wasn't sure. Thanks everyone!

Yea, I clearly misread that! Sorry, 8(f) it is! I agree, including them as part of the gain/loss isn't accurate. I've seen people do it as well