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Message Boards Digest

May 31, 2019

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

Stash026 created a topic in Distributions and Loans, Other than QDROs

Participant Defaulted on Previous Loan, Now Wants Another One

I was looking through the loan regulations and couldn't put my finger on relevant guidance here. Is there anything in the regulations that limits (or prohibits) a participant who has defaulted on a loan previously from taking a subsequent loan?
Number of replies posted  4 replies      Number of times viewed  62 views      Add Reply

Belgarath created a topic in Cafeteria Plans

'Mega Wrap' Documents to Avoid Filing Multiple 5500s

I've seen wrap documents for Section 125 plans that allow you to file just one 5500 for all of the benefits that fall under the 125 plan. I've also seen reference to a "Mega Wrap" document, which incorporates the cafeteria plan and underlying benefits in addition to certain health/welfare benefits that are NOT under the cafeteria plan. Is this a viable technique? Ignoring document issues, for now anyway -- just interested in the 5500 question.
Number of replies posted  0 replies      Number of times viewed  13 views      Add Reply

MarZDoates created a topic in SEP, SARSEP and SIMPLE Plans

Violation of 'Exclusive Plan Rule' When Contributing Earlier-Missed SIMPLE IRA Contributions?

Plan sponsor terminated its SIMPLE IRA plan as of 12/31/18. Started a new 401(k) effective 1/1/19. Employer now realizes it missed the deposit of SIMPLE deductions/deferrals for payroll periods in December 2018. Will it violate the exclusive plan rule to deposit the SIMPLE deferrals now (in 2019) along with lost earnings? I'm thinking "no" because we are correcting late deposit of deferrals for 2018.
Number of replies posted  0 replies      Number of times viewed  14 views      Add Reply

Steve A created a topic in Operating a TPA or Consulting Firm

In Acquisition Mode

I am the owner and founding partner of a midsize TPA firm interested in acquiring a similar organization in the North East. Please respond here or by phone at (516) 238-9639
Number of replies posted  0 replies      Number of times viewed  19 views      Add Reply

Belgarath created a topic in Cafeteria Plans

Must Cafeteria Plans Use the New Procedures for Disability Claims?

The 125 plans I've seen use disability insurance, and disability is determined by the insurance company, so the "new" DOL disability procedures wouldn't apply. Are there 125 plans out there where the situation is otherwise, so that the plan/SPD must be modified to take these procedures into account?
Number of replies posted  0 replies      Number of times viewed  14 views      Add Reply

Tax Cowboy created a topic in Communication and Disclosure to Participants

Ask Participants If They're Happy with a Retirement Plan's Features?

Does anyone have a sample (or a resource/guide/service they've used) questionnaire they pass out for participants in an employer-sponsored plan (e.g., a 401k, defined benefit, or defined contribution plan). For instance, the questionnaire would ask whether the employee/participant like a certain provision such as the 401k matching provision. It would measure whether the plan sponsor is satisfying the reasons for setting up the plan.
Number of replies posted  0 replies      Number of times viewed  18 views      Add Reply

PensionPrisoner created a topic in 401(k) Plans

Direct Rollover from 401(k) to IRA: Custodian Not Happy with 'Payable To' Notation

Is it required that a direct rollover check from a 401k to an IRA have the verbiage "FBO Participant Name" in the Payable To? The receiving IRA Custodian has asked us to take the "FBO" off the check. This is a direct rollover via participant distribution request, not a trustee to trustee transfer.
Number of replies posted  3 replies      Number of times viewed  64 views      Add Reply

CLE401kGuy created a topic in 401(k) Plans

Employees Made 'Unauthorized' Changes to Elective Contributions Using Recordkeeper's Website

Client instructs participants to make elective contribution changes via their payroll system. In error, the online elective contribution change feature was activated on the recordkeeper's website. Several participants made elective contribution changes on the recordkeeper's website. Does the sponsor need to recognize the changes on the record-keeper's website?
Number of replies posted  1 reply      Number of times viewed  39 views      Add Reply

pjb1835 created a topic in 401(k) Plans

Sale of One Company in Brother-Sister Controlled Group

One of 2 brother/sister companies covered under a single 401k plan is about to be purchased. Buyer has a plan already and doesn't wish to merge or transfer. Wants to sponsor only one plan post-acquisition. Does the entire brother/sister plan need to be terminated before the acquisition in order to avoid the successor plan rule issues? Should it be separated into 2 plans and then terminate only the separate plan of the soon-to-be-acquired company?
Number of replies posted  0 replies      Number of times viewed  16 views      Add Reply

TPApril created a topic in Form 5500

Asserting 'Reasonable Cause' for Failure to File Form 5500-EZ

The majority of 5500-EZ's that are filed late and then use the IRS Penalty Relief Program seem to have a similar reason -- i.e., that they didn't know they were supposed to file (upon reaching $250K in assets, for example). Anyone have experience with using that explanation as a "reasonable cause" for the late filing of the form (rather than going through the Penalty Relief Program)? Also, another question: when reviewing the IRS instructions, it's not clear to me whether a 5500-EZ should be submitted to the standard address as well as to the Penalty Relief address, similar to filing for relief for regular 5500's.
Number of replies posted  1 reply      Number of times viewed  33 views      Add Reply

Stash026 created a topic in 401(k) Plans

Adding a Provision for After-Tax Contributions

I have a client asking to include after-tax contributions (not a Roth) up to the DC maximum for two partners in a plan. Are there any ramifications for doing this? I haven't had to handle a plan with it in some time.
Number of replies posted  1 reply      Number of times viewed  29 views      Add Reply
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