Message Boards Digest

January 8, 2021

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

NW529 created a topic in 401(k) Plans

Key Determination - Initial Plan Year

"A plan is effective for the first time on 8/1/2020. When determining Key status for Officers and greater than 1% owners for the initial plan year, what compensation is used? 1/1/2020 - 12/31/2020, or 8/1/2020 - 12/31/2020?"
2 replies   |    52 views   |    Add Reply

401kLife created a topic in 401(k) Plans

Adding Safe Harbor mid-year

"With SECURE, can an existing plan add Safe Harbor mid-year?"
1 reply   |    27 views   |    Add Reply

Megan H created a topic in Distributions and Loans, Other than QDROs


"I know the cut-off date for relief for Coronavirus related distributions under CARES is 12/31/20. The situation is the participant requested the distribution before that date (instructions received on 12/29), however it was not actually processed until January. Could this qualify as a CRD?"
3 replies   |    44 views   |    Add Reply

B21 created a topic in Defined Benefit Plans, Including Cash Balance

DB/DC combined deduction limit (controlled group)

"Does the exemption to the DB/DC combined 25% deduction limit where the employer contribution to the DC plan is limited to 6% of compensation apply to the plans sponsored by a single employer regardless if the employer is part of a controlled group & there is a DC plan sponsored by another member of the group? Specifically, can a sole proprietor who operates two separate businesses sponsor a cash balance & profit sharing plan (limited to 6%) for one entity & a separate profit sharing plan for the second entity & contribute 25% of compensation?"
4 replies   |    58 views   |    Add Reply

mehmgo created a topic in 401(k) Plans

loan default

"if a plan has an early retirement age of 50 and 10 years of service in the plan and they have an active participant who wants to default their outstanding loan and pay the taxes and penalty which is all in the employee 401k source. Would they be able to default the loan and pay taxes this calendar year and not keep the interest continuing until termination with this option seeing this would be a distributable event for them"
4 replies   |    53 views   |    Add Reply

chhejr created a topic in 401(k) Plans

Question about forced termination of 401k

"I just received in the mail a check from my 401k from my previous employer ~$400. I had only been with the company for a very short period of time before quitting. I'd estimate it was only about 4-5 months. My question is. Is it possible to still rollover this cash into an IRA? It says that the distribution type on the statement attached to the check is "Termination Benefit", and the Distribution Category Code is 1. It shows that there was Federal withholding taken on the total amount but no state withholding."
1 reply   |    34 views   |    Add Reply

PaulT created a topic in IRAs and Roth IRAs

Traditional IRA funded in December, but backdoor conversion to Roth in January...

"Hello, new to the forum and new to the concept of a backdoor Roth. Over 50 years old with a combined household income of over $203K. Already maxing out our 401K's and was looking at catching up more on retirement funding (better late than never). Was suggested by Fidelity to try a backdoor Roth. Told it only takes two days for the funds to secure and then can perform the rollover, so waited until Dec. 28th to fund the Traditional IRA with $7K. Still in time to complete the conversion before the end of the year, I believed. But Fidelity took over a week before allowing the conversion, pushing the conversion into 2021. Question #1: The Traditional IRA was my only Traditional IRA and was funded with after-tax dollars. We make too much too attempt to try to deduct the contribution from our taxes, instead the desire is just to build up the Roth IRA over the next several years using the back door method. The Traditional IRA was only funded for a week and made no money so only the base $7K was converted to a Roth IRA. During the conversion, I was asked if I want to pay taxes on the money now (withhold) or later. I chose not to withhold. I am assuming that the withholding and paying of taxes is only for people who have either made a profit on the investment or have previously deducted this on their taxes. Is this correct thinking? Question #2: As I said, I want to contribute the maximum ($7K) every year into the backdoor Roth. What are my options for 2021? What is the important date here? Question #2B: In other words, what it the difference between two people, one who both contributes to a Traditional IRA and completes the backdoor conversion to a Roth IRA in December, and another person (me) who contributes to a Traditional IRA in December, but fails to convert it to the Roth until January? Are both people able to wait until, say late February, and refund the Traditional IRA with another $7K and convert it a week later in early March and have the December/January transaction count toward 2020 and the February/March one count as 2021? Question 3: Form 8086. Is this form needed now every time I file taxes so that I don't have to pay taxes on the $7K that I used to fund the Traditional IRA with after tax dollars? Thank you in advance for any help. I searched for this exact situation in the forum, but couldn't locate the same question. Paul"
2 replies   |    26 views   |    Add Reply

Here are the most recently posted jobs on, a service of BenefitsLink:

View job as Retirement Plan Administrator

Retirement Plan Administrator  View details

Femwell Group Health
Miami FL

View job as Quality Assurance Manager

Quality Assurance Manager  View details

Bates & Company
Winter Park FL

►View More Jobs

►Post a Job

►Get Instant Job Alerts, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

Copyright 2021, Inc. All materials contained in this mailing are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

Links to web sites other than and are offered as a service to our readers; we were not involved in their production and are not responsible for their content.

Unsubscribe | Privacy Policy