Following a corporate acquisition, the profit sharing plan of Target merges into the profit sharing 401(k) plan of Buyer. Prior to plan merger, participants of Target profit sharing plan filed beneficiary designation forms. Buyer's profit sharing 401(k) plan is silent as to the effectiveness of these beneficiary designations. Are these beneficiary designations effective with respect to Buyer's plan and, if so, participants' entire interest in Buyer's plan (i.e., profit sharing account plus 401(k) accounts accruing post-plan merger), only profit sharing accounts in Buyer's plan (i.e., the profit sharing account from Target's plan plus the profit sharing account accruing post-merger), or only the profit sharing account transferred from Target's plan? Because IRC section 414(l) provide that a merger of plans is the combining of plans into a single plan, it would appear that by operation of law the beneficiary designations made with respect to Target's plan remain in effect under Buyer's plan, which is post-merger the combination of two plans, until a new beneficiary designation is filed. Thoughts?

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I have a client who receives income on a W-2 and on a K-1. For 2017, his W-2 is $140,000 and his K-1 income is -$26,000. Do I need to subtract the K-1 income from the W-2 before calculating the 25% of compensation limit for profit sharing, or can I ignore the K-1 negative income? Thanks for any responses!

A 401k plan closed a bank account and transferred the funds to their Defined Benefit bank account. Six months later the funds plus interest earned were transferred back to a new 401k bank account. Should this transaction be reported on Schedule G as a non-exempt transaction? or can it be recorded as a "mistake" in the auditors report?

e have a SARSEP that has always passed the testing in previous years. It did not pass. The 2 HCE's are over 50. Can the excess be re-characterized as catch up contributions as in a 401k plan?

Company wants to deduct its 2017 PS and SH contribution on its 2018 taxes? Scenario 1: taxes filed 3/15. Contrib made Aug 15. Scenario 2: taxes on extension. Contrib made Aug 15. Taxes to be filed 9/15. Scenario 3: taxes filed 9/1. Contrib made 11/1.

A U.S. 401(k) participant is married to someone who resides in India. Originally when she filled out the 401(k) beneficiary form she left the money to someone else. When we told that she would need to get her spouse's consent to leave him off, she filed a new beneficiary form with the same non-spouse beneficiary and has specified that she is single. What are the ramifications of this to the plan sponsor?

Plan has 401(k), Safe Harbor Match, and Class Based Allocation for Profit Sharing. 1,000 hours and last day required to receive the Profit Sharing. When I run rate group testing, two employees who terminated before the end of the year show up. They both worked 1,000 hours, but they are not benefiting because they terminated their employment. If these employees are not benefiting and are receiving no employer contribution, why would they be included in the rate group testing? Is it because they do not meet a statutory exclusion?

Other than a management function scenario, I believe there must be some cross-ownership for an affiliated service group to exist, correct? In other words, suppose you have an employee of an accounting firm (no ownership) start his own firm. Then 100% of his work is done for the accounting firm. He owns 100% of his corporation but has 0% and has never had any ownership in the accounting firm. No affiliated service group?

Employer has several U.S. divisions. There are 3 401(k) Plans -- Plan A, which is handled by other TPA -- age 21 and 6 months, with monthly entry dates, Safe Harbor Match. Two plans are handled by us as TPA -- Plan B has entry on the date of hire and is a Safe Harbor Match. Plan C has a 2-month wait, with monthly entry dates and discretionary match. Plan C is a smaller Plan and will not pass coverage on its own. However, this Plan was effective 01/01/2017 but they did not hire anyone until mid-November 2017 (i.e. no contributions as no one was eligible). We cannot use the RPT for coverage -- correct? If not, I believe we can use the ABT -- correct?

An employer is considering becoming an adopting employer in a MEP. We advised this potential adopter to ask for a copy of the 408b2 notice. The sponsor of the MEP refuses and states they have no obligation to provide the 408b2 notice to adopting employers. Their reasoning is that the 408b2 regulations apply to the covered service providers and themselves as plan sponsor of the MEP (i.e the fiduciary referenced in 408b2). They state the adopting employer is not a plan fiduciary and therefore will not provide it. After reviewing 408b2 I think the MEP sponsor is right. However, how is an employer supposed to make a good decision for their employees if they don't know who is being paid what? All they have is the participant fee disclosure and cannot compare total cost between a MEP or sponsoring their own plan? Curious of anyone's thoughts.

Medical group sells practice July 31, 2018. Former doctor employee terminated employment in 2016 and is 20% vested in PS source. The terminated doctor has not incurred a forfeiture because he has not been cashed out nor has he had 5 "one-year breaks in service." We believe full vesting is required but the client isn't happy due to the circumstances surrounding the 2016 termination. Are we correct?

2 plans with common ownership, have a different match. For ADP and ACP, one is prior year and one is current year. Can we voluntarily combine the plans for just coverage?

Putting aside all of the other complications and concerns with ROBS, let's assume the structure has already been finalized and implemented. Now, the C corporation that is owned by the Plan goes to a lender to borrow money to finance its inventory, general operations, what have you. The lender is happy to lend the money to the corporation as long as the principals -- i.e., the individuals whose Plan accounts own the stock -- will guarantee the loan. Would providing that guarantee be a prohibited transaction?

A deemed distribution of unpaid loan balance in 2015 after leaving employment was recorded on tax return as income. If loan is then paid back three years later including all interest etc. can an amended tax return be filed to remove the 1099R distribution?

One-participant plan owns real estate that is rented out. An organization filed a complaint against the property manager and the 401k as the owner of a house. Are attorney fees a settler function or can the plan pay the attorney fees?