So, suppose you have CG, consisting of Corps A, B, C, and D. A & B sponsor plan #1, and they run on a calendar plan and fiscal year. C & D sponsor Plan #2, and they run on a 10/1 to 9/30 plan and fiscal year. The numbers are such that either plan, no matter how you look at it, passes 410(b) and 401(a)(4) EASILY, as very few HCE's participate. However, as an academic exercise for future reference, suppose you are testing Plan #1 (calendar year) and you wish to determine the HCE's for 2019. When doing the 5% owner test, are you looking at 5% owners only in 2018 and 2019, or, would an owner who was a HCE in plan #2 in the 2017-18 plan year by virtue of ownership in December of 2016 be included? Seems like it should be the former and not the latter. Same type question for compensation test - for Plan # 1, are you looking solely at compensation during calendar year 2018, and HCE status under plan #2 for the plan year ending 9/30/19 is technically irrelevant? Maybe to try to condense the question, for plan #1, is the HCE determination made solely under the normal plan #1 timeframes (but taking into account all employees of all members of the controlled group)? I believe this is how it works...

[Advert.]

Worldwide Employee Benefits Network helps me connect with thought leaders in the Benefits Industry. Join WEB today at www.webnetwork.org.

Self insured plan wants to cap payments made for air ambulances to some arbitrary number, $20,000 for example. Does it matter that this is for emergency care, and is this a essential health benefit under the ACA? Any source you can point do would be appreciated. Thank you!

We have a client that has an existing safe harbor 401(k) plan that does the enhanced match. There may be a new participating employer joining due to control group issue that does not have a current plan but cannot afford the enhanced match. May new employer do the basic match instead and have special language to that affect on their participating employer agreement? Both companies have HCEs.

Is there an additional requirement that if an Owner who is LESS than a 5% owner, over age 70 1/2 and is still employed MUST take RMDs because they are in a "position of control" with the Plan Sponsor/Employer? The TPA is stating this to our client, but I haven't been able to easily find anything requirement this by the IRS. Perhaps it's a Plan Document requirement? Trying to find an answer for the Owner/Employee. They actually serve as the "Chairman of the Board". Not really sure how much "control" they really have. Your help is greatly appreciated!

Taking over a 401(k) set up by one of the payroll companies in 2017. It is a law firm organized as a partnership of professional corporations. The three partners did make 401(k) deferrals both years, however the processing payroll company did not include the individual PCs as adopting sponsors of the plan. Think IRS would approve a correction for them to adopt the plan now retroactive to 2017? There are about 50 non-partner employees of the partnership who are in the plan (about 2/3 of them are NHCEs). Thanks.

One of my clients is going through an IRS audit and is getting frustrated. We have been supplying her with everything but she now wants us to take over speaking with the auditor. Years ago, I would complete the Form 2848 as an unenrolled return preparer and using my CAF number. Looking at the 2848 now, it appears that I can no longer do this? Do I need to apply for a PTIN? Am I no longer allowed to speak with the auditor at the client's request? Any advise would be appreciated.

Here is an interesting question. Participant has $10,000 of Fund A in his 401(k) account and $5,000 of a participant loan in his 401(k) account. He also has $7,000 of Fund A in his Match account. Can I have the participant sign an investment election to rebalance his portfolio and shift $5,000 of Fund A from his Match Account to his 401(k) account, and then transfer $5,000 of his loan from his 401(k) account to his match account. His 401k account would be reduced by the $5,000 loan leaving, but increased by $5,000 of Fund A being transferred in. As a result, the account has the same balance in the end. The same thing happens in reverse order on the match side. Is there anything in a reg or whatever that indicates the source of a loan can never be altered? There is much in the rules that is quite clear that loans are INVESTMENTS like any other. A consequence of that definition is that this should be doable.

A new health and welfare plan was established in 2016 and had less than 100 participants in 2016 and 2017 so no Form 5500 was filed. For the 2018 plan year, we were incorrectly told by the client that the number of participants at the beginning of the year was 145 so we filed an extension before July 31 indicating this is the first extension for the plan. Upon additional review, the client confirmed there were only 20 participants at the beginning of 2018 , therefore a 5500 report is not required. Do we need to do anything to notify the IRS to disregard the extension? Will we get any inquiry from the DOL about a potential filing? Now that we filed an extension, do they expect to receive a 5500? Thanks.