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Message Boards Digest

February 2, 2018

Here are the most recently added topics on the BenefitsLink Message Boards:

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ERISA-Bubs created a topic in SEP, SARSEP and SIMPLE Plans

Eligibility Requirements under a SARSEP

We have an engineering client who operates a SARSEP that requires a new employee to satisfy the 3/5 rule for eligibility. This is not attractive to new prospective employees. Could the employer amend the SARSEP to allow earlier eligibility and, if so, would the eligibility requirements need to be the same for all non-excludible employees? Also, is there any sort of industry standard for eligibility under a SARSEP?
Number of replies posted  4 replies      Number of times viewed  43 views      Add Reply
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Doghouse created a topic in 401(k) Plans

Puerto Rico Compensation Included in Section 3401(a) Comp Definition?

Plan defines 'Compensation' as IRC section 3401(a) compensation. The plan covers a couple of Puerto Rican residents/participants. Their compensation is reported to Hacienda. Does their compensation constitute 3401(a) compensation?
Number of replies posted  3 replies      Number of times viewed  38 views      Add Reply
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Belgarath created a topic in Distributions and Loans, Other than QDROs

Age 55 Penalty Tax Exception upon Loan Offset 'Distribution'

This is the 72(t)(2)(A)(v) exception. Any reason this wouldn't apply to a loan offset distribution (not a prior deemed distribution) upon termination of employment? I don't see any basis for saying this wouldn't apply, but we have a State tax department giving someone a hard time.
Number of replies posted  2 replies      Number of times viewed  40 views      Add Reply
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Pixie created a topic in 401(k) Plans

Failing Gateway Test But Passing Rate Group Test and ABT

Client wants to excluded commission-only salespeople from benefiting. Plan passes coverage because some of the salespeople are HCEs. It also passes the average benefits tests and the rate group tests. The only failing test: gateway. Do we need to benefit the lower-income salespeople at 5% to meet our gateway requirements?
Number of replies posted  5 replies      Number of times viewed  68 views      Add Reply
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LKSmoke created a topic in 401(k) Plans

Class Exclusion; Employee Enters Covered Class; How to Count Earlier Service?

An employee was a nonresident alien receiving non-US source income for a few years. He comes to the United States, and is no longer a statutory exclusion for plan purposes. Does his service during the period prior to his change from a statutory exclusion to an eligible employee class count toward determining his plan entry date and determining his vesting service?
Number of replies posted  2 replies      Number of times viewed  34 views      Add Reply
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