Message Boards Digest

March 20, 2020

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

taxllm created a topic in Correction of Plan Defects

Improperly Excluded Employee -- Timing of ADP Test When Making Corrective QNECs

"Eligible employees were improperly excluded from plan participation in 2009. Plan was not SH but no ADP/ACP tests were run. We correct the defect in 2020 as follows:

  • first we run the ADP/ACP tests for 2009
  • if the tests fail, we correct the ADP/ACP
  • we determine the correct contribution amounts based on EPCRS

QUESTION: do we need to re-run the ADP/ACP tests before making the corrective QNECs?"

7 replies   |    49 views   |    Add Reply

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Sue created a topic in Retirement Plans in General

Catch-Up Contribution in a 401(a) Plan

"Can an employer deposit the $6,000 catch-up contribution to his account (for 2019) if the only source is a discretionary profit sharing? Meaning, can his total PS contribution be $62,000?"

1 reply   |    33 views   |    Add Reply

30Rock created a topic in 401(k) Plans

2019 ADP Testing Deadline -- March 13 or March 16?

"Was the ADP/ACP deadline this year Friday March 13 or Monday March 16? Does anyone recall the statutory cite for this?"

5 replies   |    59 views   |    Add Reply

MGOAdmin created a topic in 401(k) Plans

Buyer Takes Over Plan Sponsorship -- What Are the Consequences?

"I have a client that recently sold their business (ABC) to a private equity firm (XYZ). Before the sale the two owners Tom & John owned 50% each. As of 10/31/19, they sold the business to the private equity firm, and the private equity firm took over as plan sponsor. [1] Are the employees deemed to be terminated as of 10/31 from ABC and hired by XYZ on 11/1? Does this create an opportunity for employees to take distributions that are not 59.5? [2] For 2019, is testing based on the whole year or should it be split between 1/1-10/31 and 11/1-12/31? [3] Is anything else affected by the change? Maybe I'm overthinking this, and it's a situation where for plan purposes, it's as if nothing happened."

1 reply   |    27 views   |    Add Reply

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