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Found 8 results

  1. I looked every where for this so sorry if this is a repeat. The employer was part of a PEO, Multiple Employer Plan and has spun off into their own plan 401(k) plan. Is the new plan considered a successor plan, and therefore cannot use the use the 3% Prior Year average available for the first plan year? Or is the new plan considered a new plan?
  2. LLP with 3 PAs (1 for each dr, LLP covered shared staff) broke up in February 2018. One of the drs kept the LLP and his PA. Some of the staff left, as did the other 2 Drs. At this time we assume those two PAs are still in existence (they were on 12/31/18, PYE). All are still participating ERs of the plan. When would the plan be considered a multiple ER plan? For 2018, the year the partnership broke up? Or for 2019, the first full PY that they were not a controlled group of companies? If the other 2 PAs (drs) cease to be participating ERS, when would that "kick out" the multiple ER "designation" - in the year it happened (like 2019 for example, if the plan is amended) or the year after the amendment? See where I am going with these questions? TIA!
  3. There is a multiple employer plan that has several adopting employers. One of the adopting employers has been operating under the plan without an adoption agreement since the spring of 2017. Can this be corrected with an amendment because it's still within that plan year or does it need to go through a correction program? Also, one of the adopting employers has merged into another adopting employer, does the merged plan need to sign a new participation agreement or should it be terminated?
  4. Hi all, Hopefully someone can help, I've searched and not much has come up on the subject. We have a plan that consists of 4 groups. (A,B,C,D) Group A would do administration and training for the other 3 groups. Recently, ownership and roles have changed and it made more sense to convert the plan to an open MEP. Group A still handing the work regarding the plan and letting the other groups adopt provisions within the plan. In past years and from 1/1/2016 to 6/30/2016 it was all in 1 plan, 1 5500. Filing with Group A's data. From 7/1/2016 to 12/31/2016 (and beyond) it is going to be treated as an open MEP. 4 5500's going forward. My question relates to the 5500 filing for this conversion year. It would seem two scenarios are at play, and I'm having trouble finding guidance: Scenario 1 - A 5500 filed for 1/1/2016 to 6/30/2016 showing a transfer out of all the assets. This would be due 4/15/2017 with extension. Then 4 5500's for the 4 groups 7/1/2016 to 12/31/2016 with assets transferred in. Scenario 2 - Since Group A will exist throughout the whole process. Group A files a 5500 from 1/1/2016 - 12/31/2016 - showing a transfer out of the other 3's assets. Then the other 3 groups file their 5500's from 7/1/2016 to 12/31/2016. We are leaning towards Scenario 2 but unsure. Thank you in advance!
  5. I'm reposting a question posted a few years ago - because the same issue has now arisen for one of my clients: Company A participates in a multiple employer plan. Company A will be merged into unrelated Company B, and its employees will participate in Company B's 401(k) plan after the merger date. If Company A withdraws from the multiple employer plan on the day prior to the merger, will that be considered a "plan termination" so that its employees can receive distributions from the multiple employer plan under the "plan termination" exception of 401(k)(10)? Would Company A have to do the following to effect the plan termination: (i) withdraw from the multiple employer plan and spin off the assets in a new plan established for this purpose and then (ii) terminate that newly established plan and distribute the money to participants. Does this violate the permanency requirement? Any qualification concerns about eventually rolling over the account balances from Company A's plan into the acquiring company's plan? Any insight would be appreciated.
  6. One of our sponsors acquired interests in a couple of companies late in 2014 and decided to bring the employees of their newly related entities into their 401(k) plan effective as of 1/1/2015. Unfortunately, they neglected to tell us, so no participation agreements were executed. Now here we are in late October 2015. To complicate things, one of the participating employers isn't part of a controlled or affiliated service group with the sponsor, so they also created a multiple employer plan. Obviously we have document and/or operational issues here. The way I see it there are two alternatives: 1) Correct the operational errors using SCP, although I haven't thought about what that would mean or if it would even be possible under SCP, but I'm sure nobody would like this result, or 2) Retroactively restate the plan effective as of 1/1/2015 onto our VS document, incorporate multiple employer provisions, and include participation agreements for the participating employers. Then file under VCP. I have no doubt the IRS would issue a compliance statement on these facts, but I'm looking for a way to avoid the costs of a filing for this sponsor without jeopardizing the qualified status of their plan, but I'm not seeing it! Anyone????
  7. Can (or is) a church plan with multiple employers also be considered a Multiple Employer Plan (MEP) or a Multiemployer plan? Thanks for any help.
  8. I'm dealing with a multiple employer 401(k) plan (Employer A and Employer B) that contains Employer A non-publicly traded securities. Employer A has been purchased, and the new owner would like to limit the future purchase of Employer A stock to Employer A employee-participants. Employer B employee-participants would be permitted to sell any Employer A stock they have, but would not be able to select additional Employer A shares as an investment option in their 401(k) accounts (but Employer A employee-participants would be able to so elect). Assuming there are no HCE discrimination issues, would this be permissible? More simply, can a multiple employer 401(k) plan offer different investment options to different participants based on the employer of the given participant? We believe this is permissible, but I have been unable to find any authority explicitly stating so (right now all I can say is that none of the qualified plan requirements prohibit it). Does anyone know of an authority that explicitly addresses this? I can't even find anything about offering differing investment options within a single employer. Anything that indicates employers have flexibility to offer investment options as they see fit would be useful. Additionally, Employer A does not plan to offer any additional Employer A shares up for sale for any participants in the plan, and thus the only way to invest in additional shares would be if another participant chose to sell, and the only way to sell shares currently held would be if another participant chose to buy. Participants would be given the opportunity to place buy or sell orders once a year. Within this structure, Employer A would like to prioritize retirees and those close to retirement for satisfaction of sell orders (in the event there are more sell orders than buy orders), as they are ostensibly more in need of the liquidity. If there are more buy orders than sell orders, the sell orders would be distributed pro rata amongst those who placed buy orders. Is this arrangement permissible? And, as above, is there any authority that addresses such an arrangement, or a comparable or related arrangement? Thanks!
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