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Message Boards Digest

August 21, 2019

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

ombskid created a topic in Retirement Plans in General

Mortgage as Profit Sharing Plan Investment

Business owner wants to use part of his profit sharing segregated account to make a mortgage loan to an unrelated individual. Proper documentation and an attachment or lien will be filed. Any problem with this type of loan?

Number of replies posted  5 replies      Number of times viewed  68 views      Add Reply
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justanotheradmin created a topic in 401(k) Plans

NHCEs Are Currently Eligible: Amend Plan to Exclude Some of Them Going Forward?

Small employer has a a fairly vanilla 401(k) plan with deferrals, safe harbor, and profit sharing. Would like to reduce the contribution to the NHCE by adding an excluded class. The one HCE also would be excluded from everything except deferrals. A number of the eligible NHCE would be excluded from the plan. Assuming coverage testing passes, this feels like a cut-back, or a violation of BRF, but I know the ability to defer is not protected, nor is right to receive an employer contribution. Usually if initially setting up a plan we are proactive in class exclusions as part of the design process, so I don't see requests for exclusions after the fact and just feel like I am missing something. Is there something that would prohibit or make this type of amendment problematic?

Number of replies posted  3 replies      Number of times viewed  49 views      Add Reply

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

Voluntary Contributions Cause 415 Excess

We have a SHNE 401(k) with voluntary contributions, all testing done. Affected participants of course owners, removed the excess and claimed the earnings as taxable. In calculating the excess, SHNE for these HCEs was not contributed. Plan doc allows SHNE for owners, but I believe the thinking was, since the SH contribution has not been made yet, why treat as excess. Is it permissible for the owners to "waive" the SHNE for 2018, or do they have to contribute, then remove it from the plan?

Number of replies posted  1 reply      Number of times viewed  28 views      Add Reply

KaJay created a topic in Retirement Plans in General

Descriptions of Eligibility Requirements Differ in Personnel Manual and 403(b)(9) Non-Electing Church Plan Document

An employer's personnel manual (dated 1998) states all employees are eligible to participate in the 403(b) plan. The same employer's plan document (2009) provides a default eligibility for employees working at least 20 hours per week. For employees working for the employer 2009 and beyond, which document governs participation eligibility?

Number of replies posted  5 replies      Number of times viewed  53 views      Add Reply
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