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Message Boards Digest

July 3, 2019

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

PINO created a topic in 401(k) Plans

Distributable Event Triggered Due to Warehouse Closure?

One of our locations just closed due to a business decision. Employees were let go. Does this trigger a distributable event for the terminated employees who participated into the plan? Are they eligible to receive 100% of their accounts even if they did not meet the yearly requirement (20% for service after 2 years, increasing to 100% after 6 years)?
Number of replies posted  3 replies      Number of times viewed  49 views      Add Reply

draper1 created a topic in Retirement Plans in General

Operational Compliance vs. Controlled Group Testing?

We have three members of a controlled group of companies: X,Y, and Z. All three have a standardized prototype profit sharing plan. The adoption agreement states that all employers participate in the plan. Each plan has a different allocation formula -- one is pro rata, the other is fixed, and the third is integrated. Can each employer allocate a discretionary amount to just its employees based on its plan's allocation formula, and then use the general test as applied to all the employees for coverage and nondiscrimination?
Number of replies posted  2 replies      Number of times viewed  36 views      Add Reply

Belgarath created a topic in 401(k) Plans

Meaning of an 'Employee Elective Deferral Failure' Under Rev. Proc. 2019-19

Really splitting hairs here, but ... when looking at Appendix A, .05(9) and (10), let's suppose that everyone has been having deferrals withheld correctly, and all of a sudden, for ONE payroll, everyone who is deferring doesn't have anything withheld on a small piece of irregular (but not excluded) compensation. If corrected immediately, does this qualify for the "no QNEC" correction? (Assume no match.) While it seems reasonable, I suppose one could interpret the language in (10) that this isn't a "failure to implement" -- in other words, it seems like that might be designed more for an INITIAL "failure to implement." Has anyone seen/heard of the IRS addressing this issue?
Number of replies posted  0 replies      Number of times viewed  14 views      Add Reply

SSRRS created a topic in Retirement Plans in General

TPA or Plan Sponsor -- Which One Responds to Employee Requests?

Assume a plan participant (active, or terminated employee) requests information regarding a qualified DC Plan that a company sponsors. [1] Who is required to provide the information, the TPA or the plan sponsor/administrator (i.e., the TPA's client)? [2] Is the TPA prohibited from providing any information because the TPA is not the sponsor/administrator?
Number of replies posted  2 replies      Number of times viewed  43 views      Add Reply

JerT created a topic in 401(k) Plans

Still Time for Me to Make 401k Catch-up Contributions?

I'm older than 50 and have never made a catch-up contribution to my 401k. Can I make one every year from now on? To make the catch-up, can I simply keep contributing to the 401k weekly as I do now until I reach $25,000?
Number of replies posted  11 replies      Number of times viewed  98 views      Add Reply

oldman63 created a topic in 403(b) Plans, Accounts or Annuities

Nondiscrimination Testing for Two Identical Plans of the Employer

To avoid audit requirement for plan, employer is splitting the plan into two separate plans. Plan provisions will be exactly the same. Since the plans have provisions that are identical, can nondiscrimination testing be performed as if they are a single plan?
Number of replies posted  1 reply      Number of times viewed  30 views      Add Reply

401(k)athryn created a topic in 401(k) Plans

Asset Determination for Purposes of Amount of Required Fidelity Bond

While reviewing a plan's 2018 fidelity bond, I see that it is $30,000. Assets reported on the 5500-SF are $305,000 as of 1/1/2018, which includes $250,000 in assets and a $55,000 employer contribution that was not deposited until 2019. I could ask the client to increase coverage retroactively to meet the 10% requirement for 2018, but is this necessary if the assets actually invested in the plan were only $250,000?
Number of replies posted  2 replies      Number of times viewed  30 views      Add Reply

beartd created a topic in 403(b) Plans, Accounts or Annuities

Can a 403(b) Plan (Non-Church Sponsor) Invest in ETFs?

Can a 403(b) plan (non-church sponsor) invest in ETFs? It's my understanding that some ETFs are considered mutual funds as long as it is a Registered Investment Company under Section 851(a) of the code. Can anyone confirm, with a cite?
Number of replies posted  1 reply      Number of times viewed  13 views      Add Reply
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