Has anyone ever drafted a legal opinion for a TPA? I am having a hard time finding a sample/template specifically addressing EB services provided by a TPA.

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Owner A owns a practice 66%. Client also owns an office building and that company provides rental space to the practice and a few other clients. Rental Company is 100% owned by Owner A. I do not believe this comprises an affiliated service group. Would that change if the sole client renting the space was the practice? A follow-up: a transaction occurred mid-year that reduced his ownership to 66%. I am thinking the determination of a controlled group or affiliated service group is a snapshot determination date and that Owner A could set up another 401k plan for the leasing/rental company for the current year. Agree?

The DOL penalty for failure to distribute auto enroll notices is $1,700 per participant per day, if I am reading things correctly. This failure is not eligible for relief under the Voluntary Fiduciary Correction Program, so was hoping to find an overall penalty cap, at least. Is anyone aware of a cap on this penalty? Since VFCP is not available, simply provide the notices ASAP, include the error as an operational error in a VCP, and hope for the best?

If you saw the John Hancock webinar today on the EPCRS program and how to use it, you will understand where my questions originate. There was a lot of coverage of enrollment errors and the corrections seemed quite complex. Actually I should have said that the corrections themselves are not that hard, once you can identify what kind of error it is, what kind of money is involved, how long ago the error occurred, whether or not automatic enrollment is a factor, etc. That's the harder part -- figuring out which kind of error you have. My question is, how would I even know an error had occurred, and ultimately, who is responsible for figuring it out and correcting it? Our non-producing TPA shop does traditional, annual reporting for retirement plans of small employers. We are not usually involved in periodic enrollment meetings after the plan is established. Unless the employer volunteers the information or the participant complains to us, we would never know if someone was enrolled late. If the employer distributes an enrollment kit in May to someone who was eligible on January 1, and that person starts deferring on June 1, all I will ever see is the total deferred for the year and the total compensation for the year from the return of the annual census data. I don't ask and I am not given any data about when participants begin deferring. I suppose I could go look at each new person in the plan, if a platform like a John Hancock is involved, and see when deferrals commenced but even then, I wouldn't know if the person initially declined and then changed his mind later on. What are the rest of you doing? Are you closely involved with the enrollments of your client's employees? Do you collect copies of the enrollment forms or the forms declining the opportunity? Is this your responsibility as a TPA? Do you rely on the investment advisor to be on top of this? Outside of informing the client and the HR department (if any) of their responsibilities when the plan is first installed, do you follow up to see if procedures are actually being followed? My colleague here says he has done these corrections a number of times over the years, but it was because a savvy participant complained about not being enrolled properly, not because he as the TPA discovered the error or because the employer let him know there was a problem. I could probably count on one hand the number of times I made these calculations and it was so long ago I don't even remember the circumstances. We would like very much to know how other firms are handling this issue.

Company A sponsors a Safe Harbor (3%) auto enrollment plan. It recently purchased another company via a stock purchase. Purchased company is also a Safe Harbor (3%) auto enrollment plan. Company A intends to merge (not terminate) the acquired company's plan into Company A's plan. I'm trying to figure out if such merger culd occur mid-year, or instead whether it would need to wait until 1/1/2020.

Can I allow union employees to make elective deferrals but exclude them from the safe harbor match, or do I need to set up a separate plan for them?

29 C.F.R. Section 2520.104-46 provides its excuse from an audit of a plan's financial statements only if, among other conditions, at least 95% of the plan's assets are qualifying plan assets -- much of which involves regulated banking, insurance, and securities businesses. Imagine a small-business retirement plan with 100% of its assets in non-qualifying assets. An officer of the plan's sponsor serves as the plan's trustee. If a TPA goes about its work normally, how likely or unlikely is it that a TPA would see information from which the TPA would know that the assets don't qualify for a Section 2520.104-46 waiver?

One of our DB plans is considering termination by buying annuity contracts from an insurance company. This plan has about 40 participants, half of whom are nonresident aliens. The plan does not allow for lump sums (other than for small benefits). The plan's assets are about $18 million. We've contacted several insurance companies but none would provide a quote, either because the plan is too small or because it covers nonresident aliens. Can anybody recommend an insurance company that would be willing to sell annuities for this type of plan?

In the case of a multiemployer health plan maintained by one of the building and construction trades, an issue has arisen as to whether employees of some of the employers who do not perform work traditionally in the trade, e.g. clerical, could be permitted to join the plan. The concept would be not to include them as non-bargaining unit employees, but to actually have them join the union and participate as bargaining unit employees. Any knowledge as to whether this is permissible or not?