Message Boards Digest

February 23, 2018

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

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Belgarath created a topic in Retirement Plans in General

New Disability Regs; Can Amendments Be Avoided by Adopting an Administrative Policy?

Like many people, I'm looking for methods to have these regulations not apply to normal 401(k) plans. Amending hundreds of plans (and attempting to explain this to clients) isn't high on my fun list. Sure, we can do a plan sponsor level amendment -- and that's probably where we'll end up. So I toss this out there for you attorneys. Suppose a pre-approved Plan document currently says that the determination will be made by a licensed physician. It doesn't specify who chooses the licensed physician. If the Plan Administrator institutes a written policy that the determination of Total and Permanent Disability is made by a licensed physician CHOSEN BY THE PARTICIPANT (and also accepts a SSA determination or under the employer's LTD program) is this sufficient to remove discretion, so that an amendment isn't even necessary? (I'm not saying this is necessarily a good idea -- in fact, it might be a very bad idea if participants get names of licensed physicians who are "easy" and will certify practically anything.) The real-life application of all this is so limited and a denial situation so uncommon that it is a whole lot of time for, generally, nothing.
Number of replies posted  1 reply      Number of times viewed  34 views      Add Reply

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austin3515 created a topic in 401(k) Plans

11(g) Amendment to Integrate at 20% of Taxable Wage Base?

Can we do an 11(g) amendment to change profit sharing allocation method from each in own group, to an integrated allocation with the allocation at 20% of the taxable wage base?
Number of replies posted  8 replies      Number of times viewed  65 views      Add Reply
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jim241 created a topic in Defined Benefit Plans, Including Cash Balance

Involuntary Cash-Out for Governmental Plans?

Can a governmental plan mandate that participants may only select a lump sum (in lieu of a month annuity) if the value of their accrued benefit does not exceed $5,000? If so, can this be done without consent?
Number of replies posted  1 reply      Number of times viewed  37 views      Add Reply
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Dave Baker created a topic in Retirement Plans in General

Transamerica to Require Use of TPAs for New Retirement Plan Business with Less Than $3M in Assets

This seems very important, so I'm reprinting it here -- it's a press release that was sent to me about ten minutes ago

(Thursday, 3:10 p.m. ET): BALTIMORE -- February 22, 2018 Transamerica Expands Commitment to TPAs and Small Retirement Plan Market Transamerica today announced that the services of a third party administrator specializing in retirement plans are required for new retirement plan business with less than $3 million in assets.

"Our experience is that smaller companies benefit significantly from the expertise of a third party administrator who can have deep conversations about their client's business and goals," said Joe Boan, senior vice president and executive director, individual and workplace distribution for Transamerica. :With this announcement, we are firmly stating that working with a retirement-focused third party administrator is a best practice for small retirement plans."

Transamerica is demonstrating its commitment to third party administrators by raising the underwriting minimums for in-house administrative services. TPAs will have access to Transamerica's streamlined retirement platform to help their clients.

"Transamerica values its alliance with third party administrators. We listen to TPAs' needs and seek out their feedback about our retirement plan program, and we take action. We agree that small retirement plans benefit greatly from the direct guidance that retirement third party administrators offer," said Boan. "We believe every company needs to have access to a quality retirement plan, and we are delighted for the opportunity to help more people pursue their financial goals for a secure retirement." There are many reasons small companies will want to consider using third party administrators for their retirement plans, including:

* flexible plan design support customized to meet the specific needs of both the business and their employees

* high levels of compliance and technical expertise on issues like loans and distributions

* enhanced consultative services

* the assumption of time-intensive responsibilities.

Transamerica believes that the future of financial wellness is the connection between wealth and health for a better quality of life. For decades, Transamerica has helped people pursue a lifetime of financial security.

To learn more about Transamerica's workplace solutions, please visit

About Transamerica Retirement Solutions, LLC

Transamerica Retirement Solutions, LLC (Transamerica) is a leading provider of customized retirement plan solutions for mega- large-, mid-, and small-market organizations. Transamerica Retirement Solutions partners with financial advisors, third party administrators, and consultants to cover the entire spectrum of defined benefit and defined contribution plans, including: 401(k) and 403(b) (Traditional and Roth); 457; profit sharing; money purchase; cash balance; Taft-Hartley; multiple employer plans; nonqualified deferred compensation; and rollover and Roth IRAs. Transamerica Retirement Solutions helps more than 5.4 million retirement plan participants save for a lifetime of financial security. For more information, visit

Number of replies posted  0 replies      Number of times viewed  51 views      Add Reply
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Sue B created a topic in Retirement Plans in General

2017 SIMPLE Plan Replaced by 2018 Profit Sharing -- Contributions Deduction Issue

Our client terminated their SIMPLE plan effective 12/31/17, and started a profit sharing plan on 1/1/18. They would like to make a contribution this week to the profit sharing plan for 2018, and they've already funded their 2017 SIMPLE. Their fiscal year is 3/1 through 2/28. Are they able to deduct both the 2017 SIMPLE contributions and the 2018 profit sharing contribution on their 3/1/17 -- 2/28/18 tax filings? They are two distinct plan years, but would be deducted in the same tax year.
Number of replies posted  3 replies      Number of times viewed  71 views      Add Reply
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teckert created a topic in 401(k) Plans

Deemed Distribution from My Employer's 401(k) Plan Due to One Missed Payment (Payroll Deduction)

I have a loan out on my 401k. In May I was out of work for two weeks and did not receive a paycheck. So, one payroll deduction was missed of $93.61. I received a letter from Wells Fargo regarding the missed payment and that if I did not bring the loan current the loan would default and then become a taxable distribution. The letter stated I should call them, which I did. The person who took my called stated they were unsure how I was to make a payment since this was a payroll deduction and they would call me back, if I had to do anything because is was a payroll deduction. (The person was not sure.) I gave them my cell number. I received a 1099R so obviously the loan was deemed distributed to me. I called 401(k) and stated they were supposed to call and tell my how to correct the problem. They are telling me they called a office number at my work and left a detailed message on how to correct the matter. I did NOT get that message. They are telling me there is noting that can be done once the loan is deemed distributed. Can anything be done so I do not have to pay the tax on the loan? I am still making payment via payroll deductions.
Number of replies posted  8 replies      Number of times viewed  69 views      Add Reply
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Chippy created a topic in 401(k) Plans

Fixing Missed Deferrals -- Automatic Enrollment Amount, or 50% of ADP?

Plan has immediate entry for deferrals. A participant was hired on 9/17/2013. (2/28 PYE). Switched to 12/31 pye at 12/31/2014. 2% initial deferral, no increase. They have never included this employee, so have to make up for 2/28/2014, 12/31/2014, 12/31/2015, 12/31/2016, 12/31/2017 and January and February 2018. Is the missed deferral 2%, or do I use the ADP and give them 50% based on that? Never had this with automatic enrollment.
Number of replies posted  4 replies      Number of times viewed  29 views      Add Reply, Inc.
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