Nate S

Seeing as how 401(a)(31) is a statutory provision, does a Plan need a separate document provision electing to be able to use an automatic rollover, or is it available to any Plan the claims qualification under 401(a)? The DC LRM from 10/2017 includes a required provisional statement about automatic rollovers, that references the mandatory distribution section, but no adoption agreement provisions are noted as needing to be included. Also, the mandatory distribution section the LRM notes that should be included, is not addressed anywhere in the LRM.

100% to the IRS???

To my knowledge yes, although these situations have me looking for a sharp nail to step on. I'd hoped that your title (both spouses) meant a polygamy question, lol!

Refund? No, his time is easily worth $1,500 to make a potential "qualification issue" go away 😇

Did...not...say...that... Your experience exceeds my own by a few years; merely using the days of paper-trading communication to suggest that the original transaction is not as wrong as someone used to email and fillable pdf's might think...

Because that's how it used to be. Not only did you need to execute the document, you also had to establish the corpus of the trust, ie put money on deposit into the name of the plan. And if you were up against the year end, constructive receipt put the document in your hands for execution as long as it was sent to you by the last day; but you couldn't backdate deposit records and mailing receipts so you were depositing monies ahead of the execution of the document.

If the order says "available" balance, have the involved counsel sign a letter of understanding that the distribution amount will be net of taxes. Otherwise, if the order requires payment of 100% of the balance, then reject it as unqualified as it requires the Plan to do something that would violate it's own governance.

ERISA 413, earlier of six years after the date of the last action concerning the breach or three years after the claimant had actual knowledge of the breach. Yes, I've seen action against ESOPs 10-15 years after for allowing the seller to be paid too high a value for their stock. Argument was that the leveraged loan was an ongoing breach and that the clock hadn't started on the SOL nevermind when the buyout payment was actually made.

I would not want to work with any document that says otherwise...

The only fix is on the payroll side, the Plan is ok since deferrals were elected and deposited to ROTH. No need to amend w-2 obviously the expense and penalties and interest would be of harm to the participant, or unreasonable expense to the employer. Instead, for current year just make sure the deferrals are classified as ROTH, the tax difference will be negligible but the participant already got the benefit of last year. To correct last year, to be taxable this year, report the amount that should have been withheld as imputed income and make corresponding withholding payment in the same amount, grossed up for the withholding taxes on the imputed income itself.

Without all the legal mumbo-jumbo and handwriting b.s.; my prudent, fair-to-all parties, and k.i.s.s.-centric advice would be to classify it as a discretionary QNEC and move on. 1. It's no longer excess;(winner) so, 2. There's no overpayment to recoup;(winner) and, 3. The auditor can't say boo about its legitimacy.(chicken dinner!)

Beginning of year valuation? If not, can it be switched readily enough? Then you can value the Plan and develop the minimum funding on a projected basis for pretty much every piece. The other question to ask is do the owners actually have 1000 hours of service to the employer? There have been threads before about retired partners who have monitored recievables and transitional relationships when they leave the firm; they continue to recieve a K-1, but aren't considered to have service since they're not acting as an employee. Does the owners activities count as operational service? If I own a TPA, but I spend 39 hours meeting with the DOL/IRS advisory committees, except for one hour a week when I review the company checkbook with the CFO, how much service do I have to the TPA itself? If I own a dairy farm, but spend my time lobbying mad cow issues, and don't do anything that produces a single drop of milk, am I farming?

Open other brokerage account for ee with any other provider besides Schwab or Fidelity.

No need to mess with reality, you can instead just say you're a really big fan of 'Major League'!!

I'm not a butcher, but at a younger age a bull would provide leaner cuts than a steer. Due to the resultant stunted growth rate, steers tend to have higher fatty deposits at the same processing weight; although two animals raised in one environment with similar feeds will have indistinguishable marbling and flavor in the lean cut itself. PSA, the grinding process destroys marbling and texture, so a waygu burger is completely pointless.

Deductibility is separate from minimum funding requirement. Ideally you would like to tie the SB to the tax return for visibility puposes, less explaining to do the IRS if ever examined, but not required. If your fiscal deductibility period closes before 9/30/2022, then you could still make a contribution against the 9/30/2021 annual limit. And if you've never made a contribution during this gap period, then you haven't yet established the precedent for how to handle it.

learn something new everyday, I always run integration with SHMA, but never knew why! Otherwise, confirm the 1.5% was correctly sourced as non-elective, maybe she intended it as ROTH, or after-tax if there was room in the ADP to shift

The source of the loan payment is 100% irrelevant. The agreement to withhold it from payroll is the same as if I direct the employer to direct deposit a portion of my paycheck to a bank account in Clydebank, Scotland. The withholding agreement should remain in force until there is no more payments to process through payroll, it's not subjective to the type of income.

Tom Callahan, Sr. once said, "Of course, I can get a hell of a good look at a t-bone steak by sticking my head up a bull's ass, but I'd rather take the butcher's word for it." CPA generates income values on K-1, as the TPA I'm going to take his word that they're reliable (excepting any prefunded employee allocations).

Or, setup a new Plan with the "discretionary true-up match" with service conditions and make the match allocation there. Amend the existing Plan for 2023; then just to be sure you stay away from successor plan issues, wait until 2024 to merge them together. But, I'm confused by the "discretionary true-up match"; true-up suggests a quarterly, or shorter, determination period, but then you say, if the company decides to make one, which I would take to mean an annual determination. Or are you saying that the true-up itself is written as being discretionary (a choice I was not aware of in a pre-approved doc)? If the later, then I'll side with the absolutely not crowd, and that's a sponsor that is wasting dollars to save dimes...

You can terminate the DB at the time of your choosing; if for 7/31, the frozen accrued benefit is then calculated using document defined compensation & service through 7/31. Your testing will occur at 12/31, using whatever full-year compensation you wish, as long as it passes 414. The only caveat to that may be 401(a)(26), which could have to be done using the 7/31 compensation, or maybe you can avoid altogether if using a formula equal to or in excess of the default minimum provision (0.5% NAR per year of blah, blah, blah) Keep in mind, your accrued benefit for 401(a)(4) is the actual calculated as of 7/31, you don't infer a full-year compensation equivalent benefit to test against; so termination years are usually easier to pass. However, you do need to pay more attention to 404 if you previously maximized under the DB, but are switching to benefitting primarily in the DC, if you are funding more to bring the assets up to 417 minimums, you may be more restricted in the DC this year. Just remind the client that the tax deduction he's getting is worth more than however much he thinks he's losing in actual allocations.

"...although not the only acceptable application of those relevant provisions." This is probably the hottest language I've ever seen the IRS produce, ie if you aren't passing you aren't testing. So in short, if your exclusion criteria is somewhere between the Plan's most lax eligibility/entry and the statutory maximum, go ahead!!

In general I distrust union multiemployer arrangements, but most of that is centered on the DB side and the draconian treatment towards the participating employers. Here, I don't have a specific objection; except to question the union motives, retain this option as a future bargaining chip, and/or squeeze some other concession out of them. Otherwise, I would look at them as any other investment provider and apply the regular fiduciary review process; investment choices, fees, participant access, etc. Also, I would do a 180 review, and judge in what position the loss of those assets will leave the transferor Plan?

Can you clarify just a skosh, I can't tell if you're referring to a DC (individual-account) or a DB (liabilities)?

I read it as any controlled group or affiliated service group relationships are combined before applying the principal business test. So if A, B, or C recipient organizations would combine in any fashion, that combined entity would then be subject to the 50% test. And keep in mind, the 50% test is on a two-year average, not the average of two years. So you need to keep a rolling record year after year to ensure continued clearance.