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Here are the most recently added topics on the BenefitsLink Message Boards:
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Belgarath created a topic in Retirement Plans in General
"Money Purchase Plan has 2-year eligibility. Years of Service for eligibility are 1,000 hours, measured on employment ANNIVERSARY years. Participant must have 'two consecutive years of service" without an intervening break year to be eligible. Let's call the end of the employment anniversary years in question, for ease of discussion, 2017, 2018 2019, 2020. So first employment anniversary year ending in 2017, has 1,000+ hours. Terminates before the end of the first employment anniversary year, then is rehired during second 1-year period. Has LESS than 1,000 hours, but MORE than 500 hours, during the second employment anniversary year period, so no break in service for Anniversary year 2018. Has 1,000+ for both employment anniversary years ending in 2019 and 2020. Because there was no break year, I believe the 2-year requirement,
even though it is a 'consecutive' years requirement, is satisfied on employment anniversary year ending in 2019. Participant isn't treated as a new hire, to start counting '2 consecutive years' from rehire date, since no Break in Service. So year two is 'washed out' and year 3 counts as the second 'consecutive year.' Agree/disagree? Should it still have to be two 'consecutive 1,000 hour years' STARTING AFTER the rehire?"
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Susan Graves CPA created a topic in Form 5500
"I have a client with a one-participant 401(k) who has always qualified for the maximum deferral and contributions. In anticipation of that, in 2019 they made their allowed 2018 contribution and they went ahead and made a $25k contribution towards the 2019 contribution. After receiving the documents from the investment folks, I filed the 5500-SF timely and included the 2019 $25k as a contribution along with the allowed 2018 contributions. Well, lo and behold, said client, in the process of retiring, didn't qualify for anywhere near the 2019 max contribution, let alone the $25k payment made in 2019 -- so we had the investment folks remove the $25k plus some earnings. This occurred this past month, in 2020. Do I need to amend the 2019 5500-SF that shows the 2019 $25k contribution that was made in 2019 but removed in 2020? Or do I show a negative
contribution on the 2020 5500-SF?"
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chibenefits created a topic in Retirement Plans in General
"LLC has elected to be taxed as a corporation. For purposes of the attribution rules under 1562(e)(2), do you still have to look at 5% owners of the LLC in determining whether a controlled group exists? Does it matter whether it is an S-Corp or a C-Corp? I cannot find anything in the 1563 regs, but my guess is that the answer to both questions is no."
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Below Ground created a topic in 401(k) Plans
"Mid-size 401(k) Plan (773 Participants) had ADP and ACP Testing done in late February 2020 for 2019 calendar year. Plan failed testing. Remedial distributions were paid timely to correct the failure. Subsequent review of participant accounts finds that Compensation and Deferrals Values provided by the Client's payroll system were wrong! Corrected values were finally provided (August 2020, delays were related to "COVID impact" at Client), so testing was run again. End result: testing results were improved for both ADP and ACP; therefore, remedial distributions paid were in excess of amounts defined by corrected testing. It's my understanding that the Plan Sponsor is expected to collect the overpayments and then return those monies to the accounts of the impacted people. (Amounts range from $2 to $100.) [1] Is that right? [2] How would that be done?
[3] How are taxes impacted/addressed by these refunds to the Plan?"
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Jakyasar created a topic in Retirement Plans in General
"Sole prop pays spouse consulting X amount as 1099 income, first time in 2019. Can 2019 be considered as date of hire for the spouse? Spouse works for another company and receives a W-2, totally unrelated to all here. Sole prop will do the same for 2020. Sole prop wants to set up a DB plan for 2020 and wants the spouse included as well. Because the spouse is getting income in form of 1099, she's considered a sole prop as well, correct? Hmmm, not so sure here. Can a DB plan be set up for 2020 and have the sole prop adopt the plan and have the spouse adopt as a second employer (assuming she can be classified as a sole prop)? Each entity would fund its own portion of the DB plan. Easy to do, because only HCEs, and different groupings. The sole prop would not/cannot fund the spouse's DB portion, if necessary, correct? Thankfully no other employees other
than their youngish children, who are excluded. Something doesn't smell right here. What am I not seeing?"
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Madison71 created a topic in Retirement Plans in General
"Could someone please provide me with the actuarial formula (possibly by way of an example with the answer) for calculating lifetime income out of the new DOL Interim Final Rule? I understand generally the assumptions used (age, balance, interest rate and mortality), but my numbers seem way off."
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52626 created a topic in Distributions and Loans, Other than QDROs
"Former participant received a notice from Social Security that she has a benefit under her former employer's plan. She terminated back in 1989. The plan has changed TPAs and recordkeepers a couple of times since the 1989 termination date, so finding the detail as to what happened to her account (paid/rolled to default IRA) has been challenging. What is the employer's responsibility regarding this matter? If they cannot prove the benefit was distributed, is the employer responsible to pay the former participant?"
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justatester created a topic in 401(k) Plans
"Plan has a fixed match with last day/1000 hours requirement (waived for RDD) 12/31 PYE Effective 7/1/2020 they amend to remove the match. Are they obligated to fund the match through 7/1. I say no since no participant (except RDD) met the last day/hours. For the RDD, I would think if the terminated prior to 7/1 they would be owed the contribution. What if the plan is a 6/30 PYE and they amended the plan effective 6/30 to remove the fixed match? (Plan has last day/hours requirement.) I am thinking they owe the match since it was removed on the last day. Had they amended the plan on 6/29, I think they would not owe the match.?"
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ESI2015 created a topic in 457 Plans
"Do any practitioners on this message board have a checksheet template you are using when you developed the processes you would put in place each year to help your administrators get acclimated with the steps that would need to be performed on a 457 plan each year from a recordkeeping standpoint -- trust accounting, tracking of increased salary reductions in 3 years before NRA, processing and timing of distributions, etc?"
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khn created a topic in 401(k) Plans
"Is adding a Managed Account option to a plan a fiduciary decision or a settlor function? It would give participants the option to enroll in a managed account feature for a fee; they would not be auto-enrolled. A company wants to add the option but we think the fidcuiary committee would need to vote on it."
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Here are the most recently posted jobs on EmployeeBenefitsJobs.com, a service of BenefitsLink:
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BPAS
Houston TX / Huntingdon Valley PA / Pittsburgh PA / Fairport NY / Utica NY
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Pension Benefit Guaranty Corporation [PBGC]
Telecommute / Washington DC
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Pension Benefit Guaranty Corporation [PBGC]
Telecommute / Washington DC
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Lois Baker, J.D., President loisbaker@benefitslink.com
David Rhett Baker, J.D., Editor and Publisher davebaker@benefitslink.com
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