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Message Boards Digest

December 3, 2019

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

bzorc created a topic in IRAs and Roth IRAs

RMDs Taken for Many Years: Now the Divisor Is 1

"A beneficiary of an IRA has been taking distributions for many, many years. For 2019, the divisor (subtracting 1 for each year) is 1. The IRA balance at 12/31/18 was $50,000, and currently has a value of $60,000. MRD for 2019 appears to be $50,000. But what of the remaining balance? Never have seen the divisor get to 1. Any thoughts would be appreciated."

Number of replies posted  1 reply      Number of times viewed  46 views      Add Reply
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LisaS created a topic in Distributions and Loans, Other than QDROs

Cash-Out Rules in a Money Purchase Plan

"The plan document has a cash-out provision at age 62 for balances that are greater than $5,000: 'Involuntary cash-out of a terminated Participant's Account balance when it exceeds the cash-out amount specified in F.11a ($5,000) is deferred under Section 7.03(b) until: Later of age 62 or NRA -- payment made in lump sum only.' In this money purchase plan, some participants' balances are greater than $5,000. Because the plan is subject to the J&S rules such that spousal consent is required, is the plan prevented from cashing out participants who have a balance greater than $5,000?"

Number of replies posted  1 reply      Number of times viewed  39 views      Add Reply

Jakyasar created a topic in Distributions and Loans, Other than QDROs

RMDs Needed for Parents Due to Being Deemed 5% Owners?

"I own a company (100%) and have my parents as employees (no ownership). My company sponsors a pension plan. Under the Code section 318 attribution rules, my parents are 5% owners, so RMDs are required. Correct?"

Number of replies posted  2 replies      Number of times viewed  45 views      Add Reply

Jim Bender created a topic in 401(k) Plans

Disclosure to Participants When Fees Are Reduced

"When there is a reduction in fees (paid from plan assets), what is the required timing to inform participants/sponsor?"

Number of replies posted  0 replies      Number of times viewed  23 views      Add Reply

BG5150 created a topic in 401(k) Plans

Assets Still in DC Plan at One-Year Termination Anniversary

"What happens if a plan has a termination date of 12/1/2018, but not all the assets have been distributed by 12/1/2019? It's a 401(k) plan."

Number of replies posted  11 replies      Number of times viewed  104 views      Add Reply

Christopher Wilson created a topic in 401(k) Plans

Separate Plans Maintained by Members of a Controlled Group

"I'm double-checking my understanding of the nondiscrimination testing rules with respect to separate plans maintained by members of a controlled group. Each spouse has a separate business and sponsors a plan. Husband receives compensation from his wife's business. When performing nondiscrimination testing for the wife's plan, one uses only the compensation paid to the husband from the wife's business, correct? In other words, compensation paid by two different businesses is not aggregated even if those businesses form a controlled group."

Number of replies posted  2 replies      Number of times viewed  63 views      Add Reply

MjInvestments created a topic in SEP, SARSEP and SIMPLE Plans

SIMPLE IRA -- Move from 5305 to 5304

"We have a client who owns a small business. The small business operates a SIMPLE IRA with the 5305-SIMPLE form being the governing document. She wants to move her account to our firm to manage the investments, but not force the other partners and employees to move their accounts. Obviously this would mean amending the plan to be governed by a 5304 document. Can she amend the plan to be a 5304 whenever, or would it be subject to the 11/2 (60 Day) notices? Are there any other issues I am not thinking of that could be of concern? I thought about the two year rule, but this is SIMPLE IRA to SIMPLE IRA so we are good and I think her account is older than 2 years."

Number of replies posted  1 reply      Number of times viewed  12 views      Add Reply
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