Message Boards Digest

January 16, 2019

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

Author's photo

Cynchbeast created a topic in Retirement Plans in General

Missed RMD for 2018: Reporting Consequences

We have client who missed paying an RMD for 2018 (seems to have been legitimate error because person normally handling this was out for illness). Participant will take RMD now -- [1] Form 5329 reports missed RMD. This goes with his 1040? [2] If taxes already filed, does he amend 1040? [3] He will attach letter of explanation; does he pay 50% penalty with 5329 or not? [4] If 2018 RMD taken now (January 2019), do we prepare 1099-R for 2018 or 2019? Anything else I'm missing? [5] Does the sponsor have to report this?
Number of replies posted  3 replies      Number of times viewed  51 views      Add Reply
Author's photo

JustMe created a topic in Correction of Plan Defects

Ineligible Compensation Used for Deferrals

We have a client that withheld deferrals on severance pay over the past several years. The participants have all taken distributions from the plan and most rolled their funds to another qualified plan or IRA. We are currently working on a VCP submission for the client for all other plan issues. For this issue, I believe the correct method is to issue two corrected Form 1099-Rs for the year of the distribution: one for the ineligible deferral amount and one for the updated distribution amount eligible for rollover; and notify the participant of the issue and that the funds were not eligible for rollover. Any thoughts on other corrective methods to pose to the IRS since we are going through VCP anyway? Suggest the participant will be taxed on the distribution anyway when the funds are distributed from the plan/IRA, so avoid double taxation and not issue the corrected 1099-R that may not prompt a "tax-free" distribution from the rollover IRA/qualified plan?
Number of replies posted  0 replies      Number of times viewed  21 views      Add Reply
Author's photo

Pammie57 created a topic in Defined Benefit Plans, Including Cash Balance

Defined Benefit/Defined Contribution Combo for Very Wealthy Individual?

We have a client who makes a ton of money -- well over $1,000,000 each year. He wants to put in more than the DC limit of $56,000. He is an S Corp with a W-2. I know very little about how DB plans work. Could he possibly put an additional $225,000 into a DB plan. What about a cash balance plan?
Number of replies posted  6 replies      Number of times viewed  48 views      Add Reply
Author's photo

perplexedbypensions created a topic in 401(k) Plans

415 Limit with Catch Up

If an employee does not fully utilize the 401(k) catch up provisions, and defers a total of $22,500, then the 415 limit would be $55,000 plus $4,000 for a total of $59,000? I just want to be sure that I should not be using the limit of $61,000. I feel no since if a participant over age 50 does not defer at all is limited to $55,000, but feel the need to check.
Number of replies posted  4 replies      Number of times viewed  49 views      Add Reply
Author's photo

lie created a topic in Litigation and Claims

Handling of a Section 79 Lawsuit

I am an expert witness on some section 79 cases but the lawyer is not going to file a class action against the insurance company. Any comments?
Number of replies posted  1 reply      Number of times viewed  28 views      Add Reply, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

Copyright 2019, Inc. All materials contained in this mailing are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

Links to web sites other than and are offered as a service to our readers; we were not involved in their production and are not responsible for their content.

Unsubscribe | Privacy Policy