If plan allows for Loans, can an employee who is on active duty (and has been 3 years) take a loan? Plan does allow for distribution for deemed severance of employment, but client wants to give loan option to employee if allowed. Thanks.

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My understanding is a more than 5% owner of a business who is still actively working has to take a minimum distribution each year. Does it make sense to contribute to their retirement plan? If they have an IRA, can they aggregate the 401k balance and IRA balance, taking the RMD out of their IRA? Thoughts?

Company owned 51% by Participant A and 49% by Participant B. December 28, 2018, Participant A sells shares to Participant B, who is now the 100% owner. Participant A compensation in 2017 was $108,000. For the 12/31/2018 Plan Year, both A and B are HCE's. Is Participant A considered a Key Employee or a Former Key Employee, since there is no ownership as of 12/31/2018. Thank you!

My understanding is a more than 5% owner of a business who is still actively working has to take a minimum distribution each year. Does it make sense to contribute to their retirement plan? If they have an IRA, can they aggregate the 401k balance and IRA balance, taking the RMD out of their IRA? Thoughts?

Has anyone else had their Form 5500 extensions denied? We have had two clients contact us this week regarding the extension letters they just received from the IRS that said their extension was denied. One client that had two plans had one plan extension approved and the other plan extension denied. I have never seen this happen before.

I've got a small pooled PS only plan. Participant R, who is a 10% owner, has about 80% of the money in the plan. She has had a medical setback and requested an in-service withdrawal to be paid as soon as possible; she completed the proper form and submitted it. I advised that the Plan Administrator should consider running an interim valuation, given that the assets are up ~20% year-to-date, and that's when I found out that there is currently a changeover in ownership and management and everything. So it's been almost two weeks as the other/remaining/new top people argue amongst themselves who will be the Plan Administrator and who will be Trustee and who will get to make this decision, and R has been waiting patiently. R called to ask where her money is, and noted that she might be separating from service soon. That triggered an alarm, because terminated participants are eligible to receive a distribution only after the end of the year of termination (to allow for the allocation of gains/losses during the year). So... if she does terminate while these people are still dithering about who should authorize what, or even if they get their acts together and authorize the interim valuation and she terminates while we're in the process of doing the interim valuation, would you think that invalidates her in-service request? I don't think so, since she made the request in good faith while she was an active participant, and it was only due to the... well, call it what you will of the people around her that caused it to not get paid timely.

I had a 401k plan for myself and one employee but was told in 2016 that they (Prime Plan Solutions) would no longer service the plan.... the document administrator was DST of kansas City, MO Prime Plan Solutions then merged with DST. Long story short .... I decided to terminate the plan at the end of 2016 however there were some late contributions for my one employee for plan year 2016. According to the VFCP calculater I needed to put in about $30 into her account which was transferred to a Fidelity IRA after the termination. So in other words that $30 was not added to her account before the termination. To make matters worse, Prime Plan /DST failed to send in the 5500SF form to the DOL, in 2016 ...which I did not know of util this summer 2019. I recently did get help to file the 5500 however still not sure what I need to do about getting the VFCP amount ($30) into her retirement account which now sits with Fidelity.

Client sponsors safe harbor 401K/profit sharing plan was going to be terminated as the employer would no longer be in business.All participants received the safe harbor non-elective. The non-highly compensated employees were terminated as of 8/30/2019. Plan is still active, employees have rolled over; owners are the only participants in the plan. Accountant now tells us the sale was an asset sale, the company is not out of business; he wants to take a deduction for 2019 for only the 2 owners and their sons. I don't see how he can.

I'm 60 years of age and withdrew out of my 401K for $5000.00 they took out $10.00 for a processing fee and $998.00 for Fed tax and $99.80 for Calif state tax ending with a check of $3892.20, do I need to worry about having a penalty or paying more taxes on this money?

Hello - I am trying to get some clarification on terminating a 403(b) plan and starting a 401(k) plan. This is already an ERISA B plan. They are a almost at the point of being a large plan filer. We are trying to avoid that of course. I have read so many different replies on if the 12 month waiting period applies. What I would like to propose is terminating the B plan 12/31/2019 and starting a K plan 1/1. However, the 12 month wait is the question. Help! The plan is invested in on the record keeper direct platform of AM Funds just as a side note. Please, any concerns or issues that occur with this, I would love the insight.

If a user of an IRS-preapproved document wants to add an arbitration provision, does any sponsor's document allow a user to specify an arbitration provision through an adoption-agreement choice or other norm of the preapproved document? If not, is an arbitration provision something a user can add without defeating reliance on the IRS's approval?