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Message Boards Digest

June 13, 2019

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

5500sorBust created a topic in 401(k) Plans

Summary Annual Report Model Notice Updates: What Changed?

With the newly released Summary Annual Report model notice updates, were any changes actually made to the wording from the prior version?
Number of replies posted  5 replies      Number of times viewed  132 views      Add Reply

Kingpin created a topic in 401(k) Plans

Sec. 404 Cushion Amount Includes Sec. 415 Increase?

I have a sole prop DB plan where the benefit is limited by the 415 comp limit. The Comp limit is still being phase in over the 10 year period. Question: Can the 404 "Cushion Amount" include the increase in the 415 comp limit during the year?
Number of replies posted  0 replies      Number of times viewed  35 views      Add Reply

BG5150 created a topic in ERPA (Enrolled Retirement Plan Agent)

ERPAs, do you put a Circular 230 blurb in your e-mail signature?

As an ERPA, do you put a Circular 230 blurb at the bottom of your correspondence? Just e-mails? I can't remember ever getting any paper correspondence with that disclaimer on it (nor can I remember I got any paper correspondence from an ERPA).
Number of replies posted  3 replies      Number of times viewed  56 views      Add Reply

Tom Poje created a topic in Retirement Plans in General

Projected Limits for 2020

Using the just-released CPI factor (256.092), I (Tom Poje) have the following:

YearCatch upCatch up
unrounded
Deferral
Limit
Def limit
unrounded
Comp LimitComp Limit
unrounded
2019$6,000 $6,405.50 $19,000$19,217$280,000$283,740
2020$6,500$6,504.00$19,500$19,512$285,000$288,120

(far column HCE limit unrounded $130,192)

DC $ LimitDC $ Limit
unrounded
DB $ LimitDB $ Limit
unrounded
Key EmployeeKey EE
unrounded
HCE LimitHCE Limit
unrounded
$56,000$56,748$225,000$226,992$180,000$184,431$125,000$128,208
$57,000$57,624$230,000$230,496$185,000$187,278$130,000$130,192
Number of replies posted  1 reply      Number of times viewed  60 views      Add Reply

susieQ created a topic in 401(k) Plans

Safe Harbor Mid-Year Retroactive Amendment OK?

A safe harbor match 401(k) plan currently has a six month eligibility (no hours per month requirement). Due to some part-time students who work on an as-needed basis, the Employer would like to amend the plan to require 200 hours per month as part of the 6 month eligibility. It would like this amendment effective date 1/1/2019. I believe the amendment is permissible, but only PROSPECTIVELY with a 30-day notice. A coworker believes the amendment can be effective retroactively to 01/01/2019 because it will only apply to those hired on/after 01/01/2019.
Number of replies posted  1 reply      Number of times viewed  42 views      Add Reply

Daggered created a topic in Qualified Domestic Relations Orders (QDROs)

QDRO In Force But Participant Won't Claim Pension

What if a QDRO is approved but the participant's benefit never gets into pay status? Can the alternate payee still get his or her payments?
Number of replies posted  2 replies      Number of times viewed  49 views      Add Reply

QP_Guy created a topic in 401(k) Plans

Using EPCRS for Correction of Defaulted Participant Loans

Anyone have any experience using EPCRS to correct defaulted loans?
(d) Defaulted loans. A failure to repay a loan in accordance with loan terms that satisfy Section 72(p)(2) may be corrected by (i) a single-sum corrective payment equal to the amount that the affected participant would have paid to the plan if there had been no failure to repay the plan, plus interest accrued on the missed payments.
That's pretty cool, but I'm stuck on the details. I have a 2018 deemed loan with a 1099R. The participant and employer did all they should to self-correct. How does the participant handle the 2018 Form 1099-R? Don't report income and wait for the IRS to ask? Must the custodian issue a corrected 1099? Something else?
Number of replies posted  2 replies      Number of times viewed  46 views      Add Reply

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

High 25 Lump Sum Restrictions -- How to Apply to Terminating Plan?

I have a small client with a couple of retirees who are interested in the new lump sum window that the IRS has recently started allowing for participants who are already in pay status. One of these retirees was a High 25 and was not allowed to select a lump sum when he retired originally. The client is making steps towards terminating the plan. If it were not terminating, the plan would need to fund up so that they were 110% funded for this High 25 retiree to receive his lump sum. Because it's terminating, does that 110% still apply or does it go away? Logically it doesn't seem to make sense and it seems like they should only fund to pay out the benefits for the plan termination, but logic and the regs don't always agree. Does timing matter? We can't terminate the plan and then create a window to pay out the lump sums. If we create a window for the lump sums, then does the 110% apply since we haven't yet terminated? If we can't do it before or after, how can we do it "at the same time"?
Number of replies posted  2 replies      Number of times viewed  36 views      Add Reply
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