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Message Boards Digest

June 29, 2020

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

Catch22PGM created a topic in 401(k) Plans

Prevailing Wage and ACP Test

"A 401(k) plan has enhanced Safe Harbor Match (100% - 4%) that only satisfies ADP. There is a discretionary match of 25% up to 20% for a small group of NHCE so ACP testing is required (don't ask why -- a previous TPA let them put it in without explaining the ACP issue). There is a large population of Service Contract Act employees who receive prevailing wage contributions in the plan. The plan document specifies that prevailing wage contributions are QNEC's that offset Safe Harbor Match.

When running the ACP test, should all of the prevailing wage contributions be included for all of the SCA employees -- with the 10% limit taken into account? I am having difficulty finding an answer and our software doesn't want to do it. I can usually rely on our software to do the right thing, but I think the prevailing wage contributions should be included in ACP based upon the Safe Harbor Match offset."

0 replies   |    42 views   |    Add Reply
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TPApril created a topic in 401(k) Plans

Owner's 401(k) Deposit Does Not Match Amount Reported on Tax Returns -- Amend Returns, or Make a Late Deposit?

"Small plan, 20 employees. Just discovered that the expected accrued deposit of 401(k) (for owners only) at beginning of prior year does not match the 5500 as well as personal and company tax returns. Contemplating 2 options: amend all tax returns and the 5500 to match actual deposit; or deposit the 401(k) amount (~ $5,000 total), over a year later."

2 replies   |    73 views   |    Add Reply

Jakyasar created a topic in Retirement Plans in General

H-1 Visa Employee with U.S. Income

"Plan document excludes non-resident aliens (standard language). Employee is residing and working in the U.S., working under H-1 visa and paid a salary through payroll from his employee in the U.S. As far as I remember, he is included in all pension related matters like all non-discrimination testing (he is excluded under a job category but part of all testing). Also, if he were not excluded, he would get what contributions are due to him including the option to defer. Did I miss anything?"

1 reply   |    64 views   |    Add Reply

JOH created a topic in Church Plans

1099-R Reporting for Housing Allowance

"How would I report on a 1099R a distribution from a church plan that was made associated with housing allowance when the minister was under 59-1/2? Code 1 or Code 2? Why would that code would be used?"

1 reply   |    42 views   |    Add Reply

JMH ERISA created a topic in Form 5500

Delinquent 5500s, 5500-EZ and SF's Across 18 Years

"Small plan is filing a delinquent 5500 for years 2002-2008, delinquent 5500-EZ's for 2009-2012 and 2018, delinquent 5500-SF's for 2013-2017, and will file a timely 5500-SF for 2019. Essentially, this company downscaled after 2008 but continued operating with a few part-time employees each year since then. There were some years where only the business owner and spouse were eligible and covered under the plan.

I think this plan will need to file under both the DFVCP and the 5500-EZ late filer programs and pay the maximum fees under both programs. Is there any way around this?

Also, is there a good way to indicate on the 5500-EZ and/or the 5500 & 5500-SF's to explain the gap in filings when it is switching back and forth between ERISA and non-ERISA filings?"

4 replies   |    52 views   |    Add Reply
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