Basically

Pardon my naiveté, when you say "qualifying vehicles" you are referring to investments and whether they are acceptable pension investments? What kind of investment would require a 5500 with Schedule I over an EZ or SF? Ohhh.. I just looked at Schedule I. I am guessing certain types of investments are considered "unqualified"? Looking at schedule I, Part I, 3 a-g I am presuming those are all unqualified investments (well, maybe not a participant loan). And all plans, even one participant plans that invest in these types of investments must file a form 5500 with Schedule I?

Thank you! That is what I thought in the beginning but then with the child's attribution/HCE status I thought everything changed. They are an S-Corporation so the EZ form on paper (no need to file electronically... correct?). I am learning that there are a lot of subtle nuances that come into play . Interesting but a lot to remember. I guess once you live it you remember all these rules and how they apply. I will research "qualifying vehicles". Thanks

I want to get this right and I feel like my plan is falling apart. I looked up attribution and read that a child employee is considered an HCE because their parent is an owner regardless of the child's age. Ok, that's fine. That solves testing quite easily. C.B Zeller in the beginning helped me understand that once a NHCE was a "covered" employee then the plan moved from an EZ to an SF form. I neglected to mention the employee in my story was the child of the owner, didn't realize attribution happened moving down the family lineage. Thought it was just a husband and wife thing. So let me summarize: - Husband & wife & daughter employees - All HCEs due to attribution - Daughter will only work part-time (yes, compensated hourly, reasonable for her job) Their goal is to help their daughter and be eligible for ERISA protection (they have done well and are just a little nervous in today's life climate. Dont want anyone threatening their nest egg). Daughter is an HCE by attribution, does that solely pertain to her status? Is the plan no longer a one participant plan? Is she considered a covered employee for purposes of Title 1 of ERISA? Do we file an EZ of SF? and is a fidelity bond required? Wow.. not asking too much am I. Thank you for your patience and help.

Ahh.. I see that point and how a restaurant type business plan could become messy. Here is my situation... Husband and wife business pay their daughter (college student) to do the books and some other odds and ends stuff in the office out of their own pocket. They want to hire her officially so she can participate, make deferrals to start saving. They personally only defer and like that (Ideally they don't want to make an employer contribution at all). This new Secure Act rule sounds like the solution for this small business. That is, if they amend the eligibility requirement provisions to read "all employees hired before X date automatically meet the eligibility requirements" that would get her in the plan. At the year end she will not have 1,000 hours so she won't be included in any testing. Husband and wife can max their deferrals and the daughter wouldn't screw it up for them testing wise. They want to help their daughter but looking into the future they don't want to open themselves up to letting possible future employees in so quickly. See where I am going? Question: Can the plan be amended to allow a new hire to be deemed to have met the eligibility requirements to enter the plan by being hired on or before a certain date? And as long as the new hire doesn't work more than 1,000 hours then they are only eligible to defer and are not included in the non discrimination testing? I understand that the plan would be required to file a form 5500-SF as that new hire would be a covered participant. And I would imagine an ERISA bond would be required.

Oh ok, thanks for that. I'm concerned with the ADP testing. If a part time employee is allowed to enter the plan because they worked 3 years with 500 hours, and then they defer, wouldn't we need to include them in the test? Or are they not included in the test because they haven't worked 1,000 hours? Got to be more to it Is there a concise Secure Act publication that has all these new rules? I'll Google "Secure Act, part time eligibility rule" and see what I can find. EDIT... found it! The SECURE Act provision for part-time employees only applies to elective deferrals. Employees who work less than 1,000 hours in a 12-month period can still be excluded from receiving employer matching contributions, safe harbor contributions and other employer contributions — until they meet the plan’s eligibility service requirement for these contributions. In addition, part-time employees who become eligible solely under the SECURE Act provision are excluded from the annual non-discrimination and top-heavy testing of the plan. So, this new rule allows part time employees (who are 21) to defer and that's it! All in all that's not a bad new rule in my eyes. Thanks for helping me

Thank you and understood... for informational purposes only. Reading your reply I see that the key word is "cover". If an employee is not "covered" then they don't count (to put it simply). If only owners are covered then the plan is eligible to file a form 5500-EZ. I also understand the form 5500-SF requirement you are explaining. If the plan has an active employee who is covered but has no balance then a 5500-SF is required. If a terminated employee has a balance in the plan left behind after they left then a form 5500-SF is required, until that balance is distributed. Got it. If I understand, starting with 2021 the requirement can still be 1,000 hours BUT if an employee works 3 consecutive years where they worked 500-999 hours then they meet the new secure act 500 hour provision and are now eligible to participate in year 4? Is the above only for salary deferrals to allow employees the ability to save for themselves? or does the secure act 500 hour rule count with regards tor employer contributions?

I have been tasked to understand/learn some pension basics. This site was recommended to me as the authority when it comes to all things pensions. Thank you for your help. a one participant plan is one where there are no employees other than the owner (and spouses and partners) If there is an employee but they just don't meet the eligibility requirement of 1,000 hours to enter the plan, is it still a one participant plan? And if that is true, then a form 5500-EZ is only required And as long as that one employee stays under 1,000 hours the plan will continue to be a one participant plan? if a one participant plan has an employee who has met the eligibility requirements, regardless of whether they have made a salary deferral, the plan must file a 5500-SF, correct? they would be a participant, just no plan balance. If the employee defers compensation in 2021 (meaning they have a plan balance) and they terminate in 2022, as long as their plan balance is in the plan do they need to file a form 5500-SF? Is it safe to say that any plan that is required to file a form 5500-SF is entitled to title 1 ERISA protection? I'm sure I will have additional questions. I don't want to be the source of misinformation.