Message Boards Digest

March 15, 2019

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

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Melissa created a topic in 401(k) Plans

Excluded Class

I have a profit Sharing only plan that has Union employees excluded. We just learned that all the employees became non-union on 10/1/2018. Does this become their date of hire for eligibility purposes?
Number of replies posted  5 replies      Number of times viewed  84 views      Add Reply

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Chaz created a topic in Health Plans (Including ACA, COBRA, HIPAA)

HRA Reimbursement for Expense Subsequently Paid

(Facts changed and simplified.) Employee participates in a self-insured health plan with an HRA feature. Employee receives medical services from out-of-network provider and is balance billed $1,000 for the cost of services that exceeded what plan paid. Employee submits claim for $1,000 to HRA and receives reimbursement. Before employee pays balance bill, plan reevaluates the claim and pays the provider the $1,000, thus the employee now owes $0 to the provider. The employee did not initiate or participate in the reevaluation. What is the consequence of these events? Can the employer seek to have the employee return the $1,000? If the employee does not or the employer does not wish the employee to do so, does the $1,000 become taxable to the employee? If it does become taxable compensation is it the obligation of the employer to treat it as W-2 compensation or is it up to the employee to address? Anyone come across this situation?
Number of replies posted  0 replies      Number of times viewed  17 views      Add Reply
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thepensionmaven created a topic in 401(k) Plans

Sole Proprietor Overshoots Maximum Allowed Deferral Amount

My client is a PLLC, taxed as a sole proprietor. His total contribution of $55,000 goes on his 1040. Participant accounts are in group annuity contracts with buckets for employee, employer safe harbor and employer profit sharing. He apparently overshot his $18,500 by $3,200. Since he does not get a W-2, accountant wants to know if the $3,200 would be able to be considered as SH, assuming the fund holder made aware there was some sort of bookkeeping error on how the contribution was coded into their system.
Number of replies posted  2 replies      Number of times viewed  44 views      Add Reply
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MLML created a topic in Defined Benefit Plans, Including Cash Balance

PVAB or Paycredit in Cash Balance Plan (with Top Heavy)

A paycredit for an employee is 25% and equals to $12,000 in hypothetical account balance. This is approximately 170 in accrued benefit. This is also approximately 6,300 in PVAB (under the plan assumption). The accrued benefit an employee is entitled to under Top Heavy is 235. PVAB is 9,000 using the plan assumptions and 11,000 using 417e assumptions. [1] Is $12,000 correct amount that an employee is entitled to (if the payout was due today), since it is bigger than the TH PVAB in both assumptions? [2] Which accrued benefit (benefit increase) do I use for the testing purpose? Am I using 170 or 235? 170 passes the test, but if 235 is used for testing, do I need to increase the paycredit rate so that the accrued benefit (under paycredit) is close to 235, or is this not relevant since $12,000 is already bigger than TH PVAB?
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