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Message Boards Digest

May 8, 2019

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

hch4cpa created a topic in 401(k) Plans

Elective Deferrals on Hold for Six Months Due to Hardship Distributions: Plan Document Aspects

Does a plan need to actually amend the plan document to eliminate the requirement that elective deferrals be put on hold for 6 months?
Number of replies posted  0 replies      Number of times viewed  26 views      Add Reply
 
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HarleyBabe created a topic in 401(k) Plans

Amending a Safe Harbor Plan to Change In-Plan Roth Rollover Provisions

Am I reading correctly that one cannot amend a safe harbor mid-year to change in-plan Roth rollover provisions? We want to amend to allow this for all amounts, whether a distributable event or not. Our document currently states there must be a distributable event.
Number of replies posted  1 reply      Number of times viewed  28 views      Add Reply

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

Cancellation of Health Insurance Over the Summer Due to Non-Payment of Premium

I'm working with an employer who has employees who do not work over the summer. They will continue to be covered under the employer's group health insurance plan but must pay for their portion of the premiums which would otherwise come out of their paycheck. We are concerned about what happens if the employee does not pay their portion of the premiums. My understanding is that there is a 30 day grace period under the ACA and that if the policy is canceled for non-payment, the employee is not eligible to re-enroll until the next open enrollment period. My questions are: [1] Is it correct that there is a 30 day grace period under the ACA? [2] If so, do you know what statute or regulation requires it? [3] Can state laws require a longer grace period (I believe they can for individual plans but can't find any information on group plans)? [4] Is it correct that they cannot re-enroll until the next open enrollment? Any cite for that?
Number of replies posted  1 reply      Number of times viewed  20 views      Add Reply

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

Hardship Availability: Count the Value of an Outstanding Participant Loan?

A participant has contributed $20,000 in pre-tax deferrals for the life of the account and a loan was taken in the amount of $7,000. The total cash balance in the participant's account is $15,000. Can the participant apply for a hardship withdrawal for the full account value because technically the basis is $20k? If the full amount is available for hardship withdrawal, is the assumption that the earnings are included in the loan asset account and therefore the withdrawal was correctly limited to solely to the contributions made by the participant?
Number of replies posted  1 reply      Number of times viewed  26 views      Add Reply

draper1 created a topic in Defined Benefit Plans, Including Cash Balance

Carving Out the 'Otherwise Excludables' -- Effect on Gateway

Suppose you have a typical DB/DC combo but with the DB 21 and 1 and the 401(K)/profit sharing immediate entry across the board. The two plans are a required aggregation group that is top heavy. Do the general rules that prohibit you from restructuring to avoid the gateway apply even if the restructuring is only to carve out the otherwise excludables?
Number of replies posted  1 reply      Number of times viewed  29 views      Add Reply

chuTzPA created a topic in 401(k) Plans

Owner Has Low Pay But Wants Higher Contributions

Thinking about plan design. Employer has one owner, 40's, minimizes pay. Would like to start up new plan and willing to increase pay to self to allow for contributions. 401k, safe harbor are fine. But this approach does not mesh well with cross-tested design because ratios are too high to pass. Pay too low for integrated formula to function too. Thinking about other design considerations.
Number of replies posted  3 replies      Number of times viewed  48 views      Add Reply

Belgarath created a topic in Retirement Plans in General

Revenue Procedure 2019-19: Some Practical Aspects

Just wondering how some of the practical aspects will play out with recordkeeping platforms, reporting, etc. For example, the SCP loan default correction. This is great, but suppose a loan defaults in year one. Deemed distribution is reported. Two years later, as allowed under the Rev. Proc., you "correct" this so that there is no taxation. Are you allowed to amend your previously filed income tax returns? How far back can you go to amend a personal return? What documentation is required to do so, etc.?
Number of replies posted  2 replies      Number of times viewed  37 views      Add Reply

doombuggy created a topic in 401(k) Plans

Group Becomes No Longer 'Controlled' -- When Does 'Multiple Employer Plan' Status Arise?

LLP with 3 PAs (1 for each doctor, LLP covered shared staff) broke up in February 2018. One of the doctors kept the LLP and his PA. Some of the staff left, as did the other two doctors. At this time we assume those two PAs still are in existence (they were on 12/31/18, PYE). All still are participating employers in the plan. When would the plan be considered a multiple employer plan? For 2018, the year the partnership broke up? Or for 2019, the first full plan year in which they were not a controlled group of companies? If the other 2 PAs (doctors) cease to be participating employers, when would that "kick out" the multiple ER "designation?" In the year it happened (like 2019 for example, if the plan is amended) or the year after the amendment? See where I am going with these questions?
Number of replies posted  0 replies      Number of times viewed  16 views      Add Reply

Megandps created a topic in Retirement Plans in General

Can One Beneficiary Form Cover Both the Retirement Plan and Insurance Policy?

If the beneficiary form clearly states the name of the retirement plan and the name of the insurance policy, can the one form be used? A client of ours was trying to cut down on making employees fill out two different beneficiary forms when the employee wants the same beneficiary for both.
Number of replies posted  4 replies      Number of times viewed  27 views      Add Reply
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