Message Boards Digest

July 7, 2020

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

TN CPA created a topic in Distributions and Loans, Other than QDROs

Thinking Through the Mechanics and Withholding Aspects of a COVID Distribution Followed by Repayment

"A client who own and runs a small hotel (and is obviously COVID-affected) wants to: 1) take out a $60,000 COVID Distribution, 2) elect to spread the tax out over 3 years, and then 3) repay $20,000 before 12/31/20, another $20,000 before 12/31/21, and the final $20,000 before 12/31/22, so that the entire amount is repaid equally over the 3 year period. If the IRS follows the Form 8915 disaster rules, this would seem to work, but I can't find any real guidance to say that is how the tax process will work. Does anyone else have any guidance or educated opinion? Also, the hardship would normally be subject to 10% withholding. Are there any ways around this for COVID Distributions intended to be repaid?"

1 reply   |    38 views   |    Add Reply
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Pensions2020 created a topic in Operating a TPA or Consulting Firm

Considering a Change to Our TPA Firm's Organizational Structure

"Considering a change to org structure to include Senior Plan Administrator and Plan Administrator (and possibly Jr. Plan Administrator). Did anyone have criteria to make someone a Senior Administrator vs. a regular Plan Administrator? Is it just experience in years worked in the industry (after 10 or 15 years?) or would it be taking on additional roles?"

3 replies   |    60 views   |    Add Reply

tsrl01 created a topic in Cafeteria Plans

Passive Enrollment for FSAs

Can someone point me to the statutory authority (or an IRS publication, etc.) which precludes passive enrollment for FSAs? I am trying to determine whether the spousal surcharge would roll over, and want to know more about a tobacco surcharge.

1 reply   |    26 views   |    Add Reply

pixmax created a topic in Operating a TPA or Consulting Firm

TPA for Sale or Merger

"Succesful Northeast TPA with under 200 plans looking to possibly sell or merge. Plans consist of 401k, 403b DB and CB. Serious inquiries only. You may email me your contact information at"

0 replies   |    32 views   |    Add Reply

Howie Simon created a topic in Defined Benefit Plans, Including Cash Balance

Valuation Date Change -- from EOY to BOY for 2019

"We are considering a change in valuation date from 12/31/2019 to 1/1/2019. I haven't checked IRS Revenue Procedure on funding method changes and whether it is eligible for automatic approval, but one major drawback to this proposed change is that AFTAP certification deadline would have been 9/30/2019. Because this didn't happen, then the plan is automatically frozen 10/1/2019, among other adverse operational changes. If they already received credited service for benefit accrual for the period 1/1/2019 to 9/30/2019 then for 2019 the automatic benefit freeze doesn't affect 1/1/2019 funding valuation results -- right?"

2 replies   |    34 views   |    Add Reply

Ken_BenefitScape created a topic in SEP, SARSEP and SIMPLE Plans

SEP Contribution Desired for 2019; Missed Deadline for Adoption?

"Can a 2019 contribution be made to a SEP that has not yet been established? We intend to set up one for an employee before July 15, 2020 and make a contribution. Or, if we elect an extension, could we postpone to October 2020?"

1 reply   |    24 views   |    Add Reply

Peter Gulia created a topic in Investment Issues (Including Self-Directed)

Can a Participant Pay Her Adviser's Fees from Her Plan Account?

"Considering only individual-account (defined contribution) retirement plans that provide participant-directed investments, can a plan (with its recordkeeper's or TPA's help) permit a participant to charge investment adviser fees (unaffiliated with the recordkeeper or TPA) against her account? When a recordkeeper or TPA allows such an opportunity, what conditions are imposed? What, if anything, does the recordkeeper or TPA require the adviser to sign to be recognized for a plan's payment regime? Does the regime for paying an unaffiliated adviser's fee allow any rate the participant instructs, or is there an upper limit?"

8 replies   |    49 views   |    Add Reply

cheersmate created a topic in 401(k) Plans

Can a Hardship Distribution Be Returned Within 3 Years If Participant Is a 'Qualified Individual'?

"A participant in a 401(k) plan received a hardship distribution in 2020. He is now a 'Qualified Individual' under the expanded definition under CARES Act ('the spouse of...'). He intends to make the election to pay the taxes over the next 3 years as permitted by a Qualified Individual under CARES, with the exemption from 10% penalty. Is he permitted to return the distribution the plan or an IRA if he is able to do so within 3 years of the distribution date?"

2 replies   |    31 views   |    Add Reply

Purplemandinga created a topic in 401(k) Plans

CARES Act Distribution a BRF as Far as Protected Benefits Are Concerned?

"If an employer allows participants to take a Cares Act distribution during early 2020, but say later in October of 2020 decides to no longer allow them, would this be a violation of protected benefits? My reasoning stems from participants who were previously allowed to take a distribution due to a particular event are no longer able to do so through the current statutory period that allows such a distribution to take place."

0 replies   |    12 views   |    Add Reply, Inc.
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