metsfan026

There's a discretionary match in the Plan, but it isn't going to be used for this year (1st year of the Plan). My bigger concern was that we needed to go back and catchup the missed deferrals. But since there isn't a match, that doesn't appear to be the case.

Thank you! I just want to make sure I'm reading this correctly. All of the missed deferrals are from August and later so it's all current and there's no current match. That means they just have to start the contributions ASAP, correct?

Good morning everyone. We have a client who inadvertently failed to start auto-enrollment contributions for several employees. I just want to make sure what the correction is for this type of mistake? Do they catchup the missed contributions via the next payroll and pay them interest for the missed contributions? For the interest, what's the best way to calculate? Thank you in advance

We have a client that has been chronically late with their contributions in the past few years (all of the interest is being paid in '24). On Schedule I Question 4a, what would be included: - Would it be just the contributions for the current year? - Would it be all contributions for the prior year(s) where interest had not yet been paid? I believe it's the second one, even though the contributions had been paid in the year. Since the participants had not yet been made whole, all contributions should be included. I just wanted to confirm. Thank you!

Yes, the SB was being done as Frozen and $0 Normal Cost. I just had never done the form for the Frozen, so wasn't sure what to check off (unlike with a Terminated Plan). There's a chance the opt to unfreeze it in a year or two, or just close it down (it's not subject PBGC). That's why I was asking.

Thanks! So, if they opt to un-freeze the plan at some point we simply remove that code on the 5500, right? I just wanted to make sure

Is there anything special to do to file a Form 5500 for a Frozen Cash Balance Plan? It is fully funded (assets exceed the liabilities) OR do we just file it with no contribution requirements for the year?

I hope so!!! And thank you!

Good morning, I have a few clients that don't want to log in and electronically sign the forms themselves. What steps do they need to take to authorize me to sign the forms (with my name) on their behalf? I think I know, I just wanted to be 100% sure. Thank you!

This is the checkoff for the Plan:

We've always used Box 5 for the compensation when a document defines it as W2 Compensation. We have an auditor questioning it, wanting us to use the Gross Pay (which isn't a box on the W2). Which one is commonly used?

OK, so pull out the overages and move them to the Forfeiture. Thanks!

I know if someone is funding the Safe Harbor Match on a payroll-by-payroll basis, a true-up is not required. However, what happens if someone is inadvertently overfunded? Does that money need to be pulled from the account or since it's on a payroll-by-payroll basis no adjustments are needed? Thanks in advance!

I have a non-gonvernmental Plan, but they do educational services and do get some grant money for pre-school programs. Would they be considered exempt from ACP Testing? I just want to make sure, as the issue is coming up with the auditors if it is required or not. Thanks in advance!

It's just a general question at this point. They haven't failed, but are worried about if they fail in the future.

This isn't my actual client. An advisor asked me, so let me get a few more details....lol

Quick question on the 70% coverage testing. If a client fails, is there any alternative correction method than a QNEC? I didn't believe so, I just wanted to be 100% sure. Thanks!

I was always told/taught that receivable profit sharing contributions are due the earlier of: 1) September 15 2) The date you file your tax return In researching something, I just found this on the IRS website: For example, if the due date of the employer's calendar-year 2022 Form 1040 or Form 1120 is April 18, 2023, with an extended due date of October 16, 2023 (after the automatic six-month extension), the employer has until October 16, 2023, to make a 2022 profit-sharing contribution and deduct it on their 2022 return. Have I always been taught the wrong thing? Or am I confusing two different things? Now I'm confused, but is this an instance that if the company is a C-Corp you do have until October 15 to fund the contribution? Thanks in advance!

One of our clients is running into an issue with the testing due to being an employee owned cooperative (we don't administer this plan, just their retirement plans). There are 17 employees and all are considered more than 5% owners due to the structure of the business. The people doing the testing are saying they fail “25% Key Employee Test, 55% Average Benefit Test and 25% Owners Test, since by definition everyone is considered an owner and Key Employee. Do these tests apply to a Plan under this type of structure? They are asking me for guidance, but this isn't my forte. Thanks!

We are in the process of getting new elections now. But yes, everyone has continuously been offered, everyone is eligible for the Match, and have opted not to. Thanks everyone!

There's no Profit Sharing currently being made. Everyone is being given the opportunity annually to participate, they are just legitimately choosing not to

I just want to make sure there's no issue here and I'm not overthinking it. There's a Plan with only owners + family members participating in the 401(k) portion of the Plan. They are doing a basic Safe Harbor Match (110% of the 1st 3% plus 50% of the next 2%). So obviously the Plan is Top Heavy and only the owners + family are getting the Match. My understanding is that this plan is exempt from Top Heavy Testing, since they are doing the match and are offering the 401(k) Plan to all employees each year (no one else wants it). Thanks in advance!

It doesn't bother me, I'm going off what an ERISA attorney had told me. That's why I'm asking the question!

There's no limit, though we are discussing it. I've always been told that the Plan can't be viewed like a bank account, and excessive in-service distributions could cause an issue.

We have a plan that allows for in-service distributions. A participant who is over 59.5, but under the age for an RMD, has already taken 3 smaller in-service distributions this year and is now inquiring about another. I've always been told that the Plan can't be used like a bank account, and these consistent in-service distributions could cause an issue. So, that leads to two questions: 1) How many in-service distributions are viewed as excessive and, if audited, could cause an issue? 2) What would the ramifications be if it was viewed as excessive? Thanks in advance everyone!