Two unrelated entities are merging into a new entity (a type A or C reorg; accountants are working out the details). They wish to merge their retirement plans. Both are calendar year plans. Plan A is a safe harbor 3% QNEC, Plan B is not safe harbor and has a matching contribution. Their goal is to merge the plans as soon as possible (in mid-year) with the new resulting entity becoming the sponsor of the resulting plan. They also want the merged plan to be a safe harbor (3%) plan. Can the merged plan be treated as "new" and adopt SH provisions? Do we need to wait until 2019, etc.?

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A retiree that is interested in starting a solo 401(k) plan in order to defer some consulting income he'll receive over the next 3 to 5 years. He also receives compensation from serving on the boards of directors for two businesses (reported using Form 1099). Can compensation for service as a director support a 401(k) deferral?

Hospital has a governmental 457b. They have multiple plans. In one of them, the hospital contributes on the behalf of participants up to the deferral limit. Is the employer limited at the 402(g) limit before catch-up, or instead can it contribute up to the additional annual catch-up limit? Because the employer has contributed $24,000 to a participant for 2017, do we need to return $6,000 so that they are only funding $18,000? My thinking is that the catch-up is available only if the participant actually defers.

Someone was full-time and has received discretionary non-elective contributions. They're now seasonal and working only 300 hours per year. Plan document calls for a forfeiture after 5 Breaks in Service. Would you forfeit while still employed?

If a MEWA plan is level funded, can it possibly be considered fully insured? And if it has not existed for a year, does that give us any out from being considered a MEWA? Seller is part of a MEWA and hasn't been in compliance with state insurance laws.

Due to an error in the client's payroll system, a participant's deferral was not taken for the plan years 2016 or 2017. They received their 3% SHNE, which was the only employer contribution. With the new 25% corrective contributions, can they still do this? I just want to make sure, because it says "the last day of the second plan year after the plan year in which the failure began" (which was 2016). So that would be 12/31/18, correct?

While reviewing W-2s for 2017, client informs me one of the employees was employed prior to the effective date of the plan (1/1/16) and was rehired 11/5/16. Because there was no plan prior to his leaving the company, isn't he treated as a new employee and thus,the waiting period would apply?

As part of a plan merger we are looking at one of the plans subject to the merger. Organization has four owners who each have established their own LLC and elected to be taxed as an S Corp. Each LLC owns 25% of the organization and is receiving guaranteed payments from the Organization. Each S Corp is then paying W-2 compensation to the owner from proceeds received as guaranteed payments. Current arrangement allows each S Corp to have its own retirement plan and be tested separate from the Organizations plan. The TPA firm says based on ownership and related that they should not be considered related organizations for retirement plan purposes. The Organization is in a service business. I am trying to explain the technical reason they should be considered one plan for testing purposes. Any thoughts?

In a recent publication -- https://www.spencerfane.com/publication/congress-eases-restrictions-hardship-withdrawals/ -- the authors say: [1] Can include earnings from deferrals; [2] Don't have to require the employee to take a loan first; [3] Don't have to suspend deferrals for 6 months; [4] Plan would have to be amended for these provisions, after 12/31/2018 (entirely optional, not required to amend). Will you amend your clients' plans to take advantage of those rules?

Plan is set up to be a non-ERISA, deferral-only plan. In order to avoid ERISA status, operational requirements apply in addition to the plan provisions. The Plan Administrator, upon receipt of a domestic relations order, refers it to the Vendor because the Plan Administrator doesn't want to kick the plan into ERISA status by making a determination as to whether the order meets the requirements for a QDRO. Vendor kicks it back and says, "I'm not going to make this determination." A similar situation could occur with hardship withdrawals. How do you folks or your clients handle these situations?