Scooby

BG5150, thanks for the clarification. Line 6g notwithstanding, hopefully folks are counting ppts with a $0 cash basis balance but who did receive a contribution that may be received in the next plan year as a participant at the end the plan year and are including those ppts in all of the required notices and disclosure requirements.

Cash balance plans are defined benefit plans; therefore, line 6g (number with account balances) is not applicable. That being said, many custodian or trustee reports are prepared on a cash or modified cash basis and generally do not reflect contribution receivables. Furthermore, the Form 5500 instructions states “the number entered on line 6g should be the number of participants counted on line 6f who have made a contribution, or for whom a contribution has been made, to the plan for this plan year or any prior plan year. “. Even though a contribution for a plan year will not be actually deposited until the next plan year, it is nevertheless a contribution for the current plan year and should be treated as part of the end of year account balance for online 6g.

Why wouldn’t the new safe harbor ppt be counted at 12/31 with an account balance? The ppt certainly has a legal right as of 12/31 to the contribution for that year despite the fact that the contribution is a receivable. The head counts should not depend on whether Schedule H or Schedule I are completed on a cash or accrual basis.