Message Boards Digest

March 25, 2019

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

BG5150 created a topic in Retirement Plans in General

Counting Service with a Predecessor Employer: What Entry Date?

Company A, which has a 401(k) plan, buys Company B (with no plan) today, and grants all service with Company B. The plan has the standard 21/1/semi-annual entry. When do the new employees enter the plan, assuming they all satisfied the 21/1 requirements? Can they be held out until 7/1, or do they have to be immediately be eligible since they have their 1 yr of service and already have passed an entry date, similar to a rehired employee?
Number of replies posted  2 replies      Number of times viewed  50 views      Add Reply

cpc0506 created a topic in 401(k) Plans

PEO Spin Off Plan -- PEO and New Plan Safe Harbor

Employer A was a participating employer in a PEO. PEO had a safe harbor 401k plan. PEO plan is a calendar year plan. Employer A has decided to leave the PEO 401k plan and establish its own plan. Effective in April, they want to spin out of the PEO into their own plan. It is my understanding that client would be subject to ADP/ACP test for the short year under the PEO because the safe harbor provisions were not in effect for a 12 month period. Is that correct? My thought is that the Plan (effective in 2019) essentially would be a new start-up plan for this Employer A with assets attributable to them being transferred from the PEO. This would be Employer A's #001 plan. If the 2019 Plan is a start-up (effective April 1, 2019) and this Employer wants to have a fiscal year end 9/30 PYE, would they be eligible to establish this Plan as a Safe Harbor plan? There obviously would be more than 3 months left in the PY to make elective deferrals, but would this fail the safe harbor rules of no consecutive short plan years? What about establishing the Plan Year as April 1 to March 31 for an initial full 12 months and then change to another fiscal year end in the future if need be?
Number of replies posted  1 reply      Number of times viewed  26 views      Add Reply

BG5150 created a topic in 401(k) Plans

Failed to Suspend Deferrals After Hardship -- Now What?

Participant took a hardship in 2018, but the employer did not suspend the deferrals. What to do now? I think we just suspend the deferrals for 6 months going forward. Right? What about the "no more suspension" rules for hardships?
Number of replies posted  3 replies      Number of times viewed  63 views      Add Reply

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

Increase NRA for DB Plan Participant's Accrued Benefit?

Have a one-participant traditional DB plan that has existed for 4 years. The employer (and participant) never had, and never will have, any employees. The participant is age 55 and the plan currently has NRA of 62. If the participant's accrued benefit is grandfathered, is there any problem increasing the NRA to 65?
Number of replies posted  1 reply      Number of times viewed  38 views      Add Reply

Sleuth created a topic in Distributions and Loans, Other than QDROs

Help with 945-X "Administrative Error" by Financial Institution

In mid-December 2019 I instructed my investment firm to transfer funds from my traditional IRA to establish a new Roth IRA and NOT to withhold taxes. I realized the 1st week of February that they withheld 10% and issued a 1099-R reflecting it. I requested a refund of the withholding at that time. They are telling me they can't refund the withholding because of the 945-X definition of "Administrative Error." I want the funds returned back into either IRA account. Is this possible, or is this $400+ billion firm not being truthful?
Number of replies posted  0 replies      Number of times viewed  12 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