Message Boards Digest

April 14, 2020

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

Peter Gulia created a topic in 401(k) Plans

What Is the Last Day on Which a Coronavirus Loan Can Be Made?

"CARES Section 2202(b)(1) refers to a loan 'made during the 180-day period beginning on [March 27].' Of the many explanations that law firms, accounting firms, retirement-services providers, and others have published, some describe the end of that period as September 23, and some say September 22. Many BenefitsLink mavens are careful about how to read a text, and about how to count things. What do you say: does the 180-day period end on September 22 or 23?"

6 replies   |    91 views   |    Add Reply
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rocknrolls2 created a topic in Multiemployer Plans

Apprentice Fund Requesting 501(c)(3) Determination - Puzzling Form 1023 Questions

"I represent an apprentice fund that was originally organized as a 501(c)(5) labor organization. It decided during 2019 to apply for recognition as a 501(c)(3) because it qualifies as a school. In preparing the Form 1023, there are a lot of questions about relationships and the instructions to the 1023 do not address how to respond to these types of questions.

For example, Part V. line 2a asks if any of the officers, directors, or trustees are related to each other through family or business relationships. It is not clear how far family relationships extend, such as whether in-laws would be included and it is not clear from the list of trustees whether any of them are in-laws to any other trustee or officer or director. As far as business relationship, is a union trustee who is also an officer of the local union in a business relationship with him or herself or with other trustees who are similarly situated?

Part V, line 1c asks whether any of the officers, directors or trustees are related to the highest compensated employees or highest compensated independent contractors who are listed in 1b or 1c above. Again they are asking about a family or business relationship.

Part V, line 3b introduces a new term. It asks whether each of the officers, directors, trustees, highest compensated employees and highest compensated independent contractors receive compensation through any other organizations related to the organization through common control. I noticed that the IRS Regs at Section 1.414(c)-5 contain regulations for determining whether tax-exempts are under common control. There is not an overlap of employer trustees among any of the funds established by the local union but there is overlap on the union trustee side. In fact, one or two of the trustees of some of the funds are either also trustees of some or all of the other funds as well as officers of the local union.

Given that the union local is very small in membership, it is likely that the officers ol the local, who appoint the union-side trustees would appoint themselves as trustees to one or more of their funds. Is this sufficient to give rise to common control?

Next, in Part VIII, line 15, another new concept is introduced. There, the question is whether the organization has a close connection with any organizations. What is a close connection? Is it overlapping union trustees of a small local union? Does it mean that two or more funds sometimes, often or seldom work together to accompish the same or similar goals?

Since the instructions are silent, is there some guide book toward preparation of a 1023 that explains these concepts in greater detail?"

0 replies   |    17 views   |    Add Reply

PensionPro created a topic in Retirement Plans in General

3-Digit Plan Number for SIMPLE IRA?

"Filing VCP for a SIMPLE IRA. The forms are asking for the 3-digit plan number. Do SIMPLE IRAs really have plan numbers? Should I leave it blank or just put 001 in there?"

2 replies   |    38 views   |    Add Reply

Lolo created a topic in 401(k) Plans

Qualified Individual for Purposes of Loan Deferment Under CARES Act?

"Would this participant be considered as experiencing 'adverse financial consequences as a result of being quarantined' and qualify for loan deferment? -- The participant has a 401k loan but has not had a reduction in hours/pay due to COVID-19. Participant's spouse has lost their job due to COVID-19 (not diagnosed with COVID-19 but cannot work).

CARES Act Qualified Individual: to an individual (a) who is diagnosed with COVID-19, (b) whose spouse or dependent is diagnosed with COVID-19, or (c) who experiences adverse financial consequences as a result of being quarantined, furloughed, laid off, had hours reduced, or other factors as determined by the Secretary of the Treasury during the COVID-19 pandemic."

1 reply   |    43 views   |    Add Reply

Peter Gulia created a topic in 403(b) Plans, Accounts or Annuities

A Typical Section 403(b) Plan Has No Minimum-Distribution Provision That the Plan's Sponsor Can Change

"Of the many requests for CARES Act instructions that service providers send, some are asking whether a plan’s sponsor prefers a halt on minimum distributions. Some ask that question even of a § 403(b) plan’s sponsor. Further, some ask the question without considering that the IRS-preapproved document the same service provider furnished makes clear that the plan imposes no involuntary distribution to meet a minimum-distribution requirement.

26 C.F.R. § 1.403(b)-6(e)(2):

26 C.F.R. § 1.408-8:

Unlike most BenefitsLink posts, this one asks no question. I put it here only so those reading for CARES Act ambiguities see another point."

0 replies   |    16 views   |    Add Reply, Inc.
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