Basically

I agree rocknrolls2. For 2021 the beneficiary does not need to take an RMD For 2022 the beneficiary will need to take an RMD based on the 2021 balance. So, the beneficiary will need to take the 2022 RMD PRIOR to taking a full distribution of his inheritance... correct?

Penchecks... setup the distribution, have the money sent to them and you are done.

Ok, so because she is old enough to need an RMD and because she died that is what triggers the required RMD.

Mr. Bagwell, that is what I have been told. 2021 becomes the beginning date, must take the RMD by 4/1/2022 C.B. Zeller, the beneficiary is the spouse. It is my understanding that there is an exception to the 10 year rule. He can roll it all into an IRA and simply take normal RMDs (no 10 year rule). You are also correct, they have not/did not taken the RMD by 4/1/22. This is a CPA asking me what I know, this is not my client. They will deal with late penalties. I am assuming the spouse beneficiary will need to take an RMD (for 2022) prior to rolling it all over to his IRA, correct? And use the table for beneficiaries, not the uniform life?

Never terminated, just died December 2021. (12/22/21 I'm told) Because she died would she be considered terminated as of her date of death? and as such be required to take a 2021 RMD based on her 2020 year end balance? I can see the beneficiary being required to take a 2022 RMD based on her 2021 balance.

So an employee who was never required to take an RMD, if they die then the RMD requirement will kick in? The beneficiary will be required to take it until the funds are distributed? If so, when? Beginning the following year? The year they died? This participant died in December 2021. Appreciate your help.

I have never heard of this situation. A full time employee old enough to need an RMD but not required to take one because she isn't an owner (just an employee) died in December 2021. Technically she wasn't employed as of her date of death. That wouldn't kick in that she needed to take an RMD for 2021 based on her 2020 balance, would it? Maybe the short question to ask is, do deceased plan participants (who have not been paid out yet) need to take RMDs? I guess technically they still aren't owners so no? I just read that "once a participant starts taking an RMD they must continue taking one, even after death". The twist is that this participant was never required to take one due to the fact that they were an employee and not an owner. Would that mean that her account is not required to distribute an RMD for 2021 because she was just an employee? Am I answering my own question?

Let me clarify my situation... Dr. Bob was 75+ He died late December 2021 - Dr. Bob must take an RMD for 2021 dead or alive... got it. Dr. Bob (dead) Still has a plan balance in 2022 - I am assuming Dr. Bob does not need to take an RMD for 2022... right? - Dr. Bob's wife (sole beneficiary)... must she take a 2022 RMD from the plan? (She has already rolled it over to her IRA) - and if so we would use Table I (Single Life Expectancy) (For Use by Beneficiaries)... yes?

Follow-up.... The surviving spouse and sole beneficiary must take an RMD for 2022. What table would I use? This single life for use by beneficiaries? 2021 Publication 590-B.pdf

The plan sponsor is asking... and as I read his email closely he's got to be off with his thoughts. Full disclosure, I think he is asking a hypothetical question. He feels he has a good price for the bond from Hartford and is worried they won't go any higher. IDK why they wouldn't. I'm going to tell him he just needs to have one bond... just keep it simple. sorry to waste any time.

He is asking if he can have 2 concurrent policies that add up to the bond requirement.

Client has a bond but needs to increase coverage. He is asking.... "to meet the coverage requirement does it matter if I have 2 bonds that in total meet or exceed the coverage requirement?" I don't see a problem... but thought I would ask

Yes the plan is terminating. Thank you for your reply

This client sold his business, it was absorbed by a larger company. Almost all of the employees went to work for the new owner. Many employees are rolling their pension accounts into the new employer's plan, some into IRAs. One employee has a loan and would like to "cancel it out" and only roll over her tangible assets to the new employer's plan. Am I missing anything... any reason she can't do this? Split her distribution into 2 parts, rollover to new plan and cash distribute her loan as a taxable distribution? Thanks

A Dr. left a practice and started his own. He rolled his pension into a new plan established by his new practice. This money would be an unrelated rollover, correct? He promptly took a $40K loan. Made payments. COVID comes and he suspended his payments. He forgot to re-start his payments so now the loan is in default. If I am correct and the money the loan was taken from was his rollover account, can't we just distribute the remaining balance, issue a 1099-R and be done? Would it be an offset? Dr. Loanshark is only 55, if that makes a difference.

Deceased participant... Spouse is the primary beneficiary... Can she waive her right as the primary thus passing the benefit onto the secondary beneficiaries? (the kids)

Thanks... was hoping for an exception but it is what it is. The CPA messed up... not my client, not my problem.

Just some clarification please... If an owner participant dies before the year end but after the RBD (I was told he is way past 72), the RMD should have been taken before 12/31... correct? Thanks

Thanks for the reply, sorry for disappearing. I will look up if Massachusetts requires withholding.

So this single member plan paid out the RMD for 2022 today but did not withhold the fed and state taxes. The financial advisor is saying..."no harm no foul... just put on the 1099-R no withholding and the participant will be responsible for the taxes outside the plan". He said that "the CPA will prepare some tax payment vouchers and remit the funds". Soooo... will there be a problem? is this ok? Thanks

Thanks so much

Client bonused himself $28,000 to max out his deferral He reported on his W2 $28K in box 12 and coded it D I told him he exceeded the 402g limit He withheld taxes from the $28K and deposited $25,858 into the plan. He wants to say that the extra $2K is a voluntary contribution. He can do this (doesn't exceed 415 limit) but it needs to be in Box 14... correct? And technically he needs to actually deposit $28,000... correct? In the end he needs to amend the W2 and make whole the $28K in the plan... correct?

So he has to fix It's a small heating oil company, 5 employees total, and everyone is participating. The owner is happy to pull the contribution because this burner tech has burnt him by quitting after the owner went over and above to accommodate him. At the same time he doesn't want the terminated employee to spread bad blood. The owner is ok with paying the 20% vesting ($1,600) to just make him go away. Can't leave it alone?

A plan sponsor provided a hire date that was actually months before the employee was actually hired. As a result the employee was included in the profit sharing contribution calculation. A contribution was made on the employee's behalf. This is a straight PS plan, not a 401(k). Do we have to honor the contribution, or actually, do we have to take it away ? Thanks

I'm pretty sure that is how it is CuseFan but I will be sure to check. Thank you