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Hi yall, I'm working on a 2017 Form 500 for a plan and have a small issue There was one participant got refund of $50 loan principal overpayment in 2017 for a 2016 loan. How can i characterize this refund on 5500? I was thinking about putting that $50 as negative ($50) in other income or $50 in the Benefit payment - directly to participants. I looked into 5500 instruction Line 2c. Other income. Enter all other plan income for the plan year. Do not include transfers from other plans that are reported on line 2l. Other income received and/or receivable would include: 1. Interest on investments (including money market accounts, sweep accounts, STIF accounts, etc.). 2. Dividends. (Accrual basis plans should include dividends declared for all stock held by the plan even if the dividends have not been received as of the end of the plan year.) 3. Rents from income-producing property owned by the plan. 4. Royalties. 5. Net gain or loss from the sale of assets. 6. Other income, such as unrealized appreciation (depreciation) in plan assets. To compute this amount subtract the current value of all assets at the beginning of the year plus the cost of any assets acquired during the plan year from the current value of all assets at the end of the year minus assets disposed of during the plan year. Line 2e(1) Directly to participant. payments made (and for accrual basis filers) payments due to or on behalf of participants or beneficiaries in cash, securities, or other property (including rollovers of an individual’s accrued benefit or account balance). Include all eligible rollover distributions as defined in Code section 401(a)(31)(D) paid at the participant’s election to an eligible retirement plan (including an IRA within the meaning of Code section 401(a)(31)(E)); How do yall think this should be in the 5500? I'm leaning more on the Benefit payments directly to participant. This is a new situation for me. I appreciate all the inputs. Thank you.

It is my understanding that an employee's contributions to a governmental defined benefit plan cannot be refunded to an employee who is no longer covered by the plan if he or she remains employed with the sponsoring employer unless he or she reached normal retirement age. This issue arises in the context of a collectively bargained employee who leaves the bargaining unit to become part of management. Does anyone know of any exceptions or is there any authority that supports the refund of employee contributions to someone who transferred to a position not covered by the plan but has not separated from service?

Hi- I have an employee who elected the Roth within our plan and had one deduction. She is stating she didn't mean to sign up for it and changed back to all pre-tax. She is reqeusting a refund for the one pay period where the Roth was withheld. Since she made a Roth election which was correctly withheld in PR are we allowed to refund her? I have always gone with we need to withhold based on the elections made. Are we able to refund the deduction based on her reqeust? I can't find any wording to back up either way. Thanks!

Client failed testing. Refunds issued and cashed. Discovered bad data was used. Tests rerun and client still failed but refund required for HCEs was less than what was issued? As to issue of refund, can they self correct?

I have a client that fails the ACP test and is required to refund match to two HCEs. One of the HCE is not fully vested in the match contriubution. How is the refund handled in this case - does he still receive the full refund, or is part of it forfeited?