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Here are the most recently added topics on the BenefitsLink Message Boards:
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Bird created a topic in Retirement Plans in General
"I probably know the answer to this but will ask anyway...employer has a SIMPLE IRA and only owners are contributing in 2020. If we start a 401(k) in 2021, and we cover NHCEs, do we get the credit? (NHCEs were eligible in 2020 but none were contributing.)"
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Gilmore created a topic in Retirement Plans in General
"Company A sponsors a 401(k) plan and purchases unrelated Company B in 2017, forming a controlled group. In 2018 Company B adopts its own 401(k) plan. The entire time through 2020 the controlled group has been relying on the coverage transition rules. It seems to me that Company A would have reliance, but Company B should not have had reliance since the Plan started after the transaction and during the transition period. If that is correct, and assuming the two plans could not satisfy coverage separately, would the correction be to retest both plans together starting with the 2018 plan year? Thank you very much."
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RaiCMC created a topic in Relius Administration
"Does anyone else use YEDC? If so have you been having a lot of issues with the 2020 questionnaire. The website has been going up and down every day for us."
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Scuba 401 created a topic in Correction of Plan Defects
"client started a 401(k) in the same year they also had a SIMPLE IRA and also excluded employees who were with a related employer (controlled group). VCP says basically for the first issue you just file the vcp and ask the IRS to allow the contributions to stay in the plan. However you also have to deal with the people you excluded and make a corrective contribution. Would IRS want you to make a corrective contribution for the improperly excluded employees to a plan the employer shouldn't have had?"
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still learning created a topic in Retirement Plans in General
"Company A, a C-Corp, was formed as a shell, started a 401(k), and the one employee of A rolled over his 401(k) account balance from a former employer. The 401(k) then bought all of the stock of A, and A bought a fast-food franchise with the proceeds. Some years went by, business grew, and A (still wholly owned by the 401(k)) wants to adopt a DB plan for the benefit of all its employees. Any reason this can't be done? It seems to me that A is run as any other business, and in fact already sponsors a qualified plan (the 401(k) plan that owns A), so I don't see any reason why not. Would the answer be any different if the franchise were its own entity, and instead of owning it outright, A and the other entity were a controlled group?"
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FORMER ESQ. created a topic in Correction of Plan Defects
"Suppose I have a traditional 401(k) plan without a match. Calendar year end. There is an employee who was not given the opportunity to defer into the plan from January 1, 2010 to February 15, 2016. Assume the error was discovered on February 1, 2016 and the participant was given the right to defer beginning on February 15, 2016. Suppose further that the reason for the missed deferral opportunity was a mistaken exclusion of the employee (so there was no deferral election in place). To determine the corrective QNEC amount, EPCRS has you look at the ADP of the group of employees (HCE or NHCE) that this employee belonged to during that period. Suppose the employee has been a NHCE for the entire period. Also, suppose the plan does the ADP test on a current year basis. For 2010 through 2015, the ADP for the NHCE is known. However, the ADP for the NHCE for 2016 is not known. What ADP is
used for the remaining 1.5 months (from January 1, 2016 to February 15, 2016) when the ADP for 2016 for the NHCE will not be known until at least 12/31/2016? I do not see an answer to this anywhere in EPCRS, but it could be that I am just missing something very basic. Does anyone have any thoughts?"
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Shuo created a topic in 401(k) Plans
"I recently started a company in the 401(k) space. I am looking for an advisor with extensive experience dealing with the recordkeepers and rollovers. Please let me know if you are interested. My email is jiao.shuo@gmail.com and here is my linkedin profile https://www.linkedin.com/in/shuojiao/"
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boomo99 created a topic in Qualified Domestic Relations Orders (QDROs)
"qdro was finalized, she finally signed it and my lawyer submitted to my ex employer. It was denied because her SSN was not submitted and they did not have it. I dont know it, so of course i tried in many ways to reach out to my ex to supply it to my lawyer and she just wont. so now what? is there a point i can just get my pension without her getting it if she doesnt comply? oddly, my lawyer has not returned any of my questions, so i have come here. thanks"
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Egold created a topic in Retirement Plans in General
"Please provide the uniform lifetime table for RMD commencing 2021"
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Egold created a topic in Retirement Plans in General
"It appears to me that if a participant was receiving RMD in 2019, (ex. 70 1/2 factor 27.4) The participant was not required to have a RMD, but for 2021 the factor to calculate RMD for 2021 is 25.6? Is this correct? Or is there a new table for calculation purposes?"
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tedschumann created a topic in Operating a TPA or Consulting Firm
"I own a small RIA firm in Michigan. The majority of our assets under management are in 401(k) and 401(k)/Cash Balance combo plans. Similar plan provisions, model portfolios, and fund lineups. We also have an accounting/tax division with large overlap of our retirement plan clients. I've explored the MEP/PEP structure a few times over the past few years. Theoretically, it should be a great solution for a book of business like ours, however, I can't seem to make the fees or operations in a MEP/PEP structure materially better than our current set-up. I'm thinking of trying to buy a small TPA and Record Keeper that would mainly serve clients within the RIA. My hope would be that I could reduce price and streamline operations since so many of our plan are similar, and pass these savings along to clients reducing administrative fees. Has anyone ever done anything like this, or know of any
small firms that might be a good target for acquisition?"
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MHANSON created a topic in 401(k) Plans
"Hoping someone can help me determine if I have a controlled group issue between multiple businesses my wife and I fully or partially own. Businesses and ownership is as follows: - My wife owns 100% of a S-corporation that sponsors a 401K plan with safe harbor provisions in place. This business and plan have been active for many years.
- I am a sole-proprietor and have been funding an Solo(K) for several years - but my total annual contributions have always been below the employee-only contribution limit.
- I have an associate that also operates his own sole-proprietorship. That is his only business that I'm aware he owns and I'm not certain what he's been doing in terms of retirement plans.
- I am forming an S-corporation with the associate and each will own 50% to start. The s-corp will pay joint administrative and office expenses and will have one employee.
We will still own and operate our own sole-props and will only reimburse the S-corp for our pro-rata share of expenses. My associate and I will not be employees of the s-corp, but will be officers and directors. We would like to offer a retirement plan to the employee - but ideally a SIMPLE or SEP plan.
Considering the above, my questions are: - Is my sole-prop technically a controlled group with my wife's corporation? Although I think answer to that question is probably yes, I am hoping that I'm OK since I have not been contributing over what the maximum of would have been allowed had I been a participant in her safe harbor plan. However, going forward should I integrate my plan into her plan or am I OK keeping it separate? FWIW, I am utilizing a brokerage account for my plan while there is no brokerage account option in her plan so I hope I can continue to operate in
that same manner. Also, if I am a controlled group I assume I cannot (or at least should not) try to operate a different type of retirement plan such as a SEP for my sole-prop?
- Will the newly formed s-corporation be considered a controlled group with my sole-prop? And taking it a step further, if that is the case would it technically be a controlled group under my wife's corporation as well (assuming my sole-prop is a controlled group under her s-corporation)? If those are both YES I assume I would have to offer the employee coverage under the same 401K plan and likely change my Solo(K) to a regular 401K. However, I am hoping that this isn't the case since I only own 50% of the new corporation. As mentioned above, we would like cover the employee via a SIMPLE or SEP plan.
- Will the new s-corporation and my partners sole-prop be considered a controlled group? If that is
the case I would think that he could participate in the 401K plan if he desired. However, he probably should not operate a different retirement plan for himself. Once again, I am thinking that because he only owns 50% of the corporation that he is not in a controlled group.
So, my hope is that the only controlled group in the above is my sole-prop and my wife's s-corp and that I will be OK since I would have been operating within the parameters of her plan had I been participating in it. However, any insight into any of the above would be greatly appreciated. Thank-you! Matt"
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MHANSON created a topic in Health Plans (Including ACA, COBRA, HIPAA)
"I just posted a very similar question in the 401K section of this forum. As a matter of fact, I basically just copied the initial scenario description from there, but there are some differences in the questions I have. Hoping someone can help me determine if I have a controlled group issue between multiple businesses my wife and I fully or partially own. Businesses and ownership is as follows: - My wife owns 100% of a S-corporation that does not offer health insurance to her employees since most employees have coverage through their spouse. We feel it would be redundant to provide additional coverage and instead utilize the funds she would be spending on health insurance to provide additional bonuses and extra paid vacation time to the employees. This business and health plan have been active for many years.
- I am a sole-proprietor and have taken a self-employed health
insurance deduction for several years. We have been purchasing our insurance directly through the exchange.
- I have an associate that also operates his own sole-proprietorship. That is his only business that I'm aware he owns and he is now on Medicare but I think his wife is still covered via a plan through the state (retired teacher).
- I am forming an S-corporation with the associate and we each will own 50% to start. The s-corp was formed to pay joint administrative and office expenses and will have one employee. We will still operate our own sole-props and will only reimburse the S-corp for our pro-rata share of expenses. The associate and I will not be employees of the s-corp, but will be officers and directors. I would like to offer health insurance to the employee, but also want to look at options to obtain health insurance for myself and family through the
s-corp.
Considering the above, my questions are: - First, are there any issues with me taking the self-employed health insurance deduction through my sole-prop even though my wife doesn't offer any health insurance to her employees? While I believe I may technically be in a controlled group with my wife's business I am hoping that it doesn't impact my ability to take the SE health insurance deduction for our privately purchased insurance.
- Second, for health insurance benefit purposes, would the new s-corp being formed be considered a controlled group with my sole-prop and/or my wife's s-corp? I'm thinking this isn't the case since I am not an 80%+ owner of the new corp. Assuming it's not the case I am under the impression that there should not be any issues providing health insurance benefits to the employee even though my wife doesn't offer health insurance to
her employees.
- Finally, if we are OK so far, would I be able to acquire health insurance for myself and my family by nature of being an officer of the s-corp without impacting my wife's business? In a perfect scenario we will obtain a small group policy through the s-corp that covers employees and officers. My partner would be exempted as he is on Medicare - though possibly he would be eligible to cover his wife through the group policy until she becomes eligible for Medicare. In any case, I believe this all hinges on the new corporation not being in a controlled group. IF it is part of a controlled group including my business and my wife's business I am hoping we can just reimburse the employee for individually obtained insurance through the health exchange and I can continue to purchase my own insurance and write if off via the SE health insurance deduction through my
sole-prop.
Any help or insight on the above would be very appreciated. Just trying to cover my bases so we don't get a nasty surprise down the road... Thank-you! Matt"
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thepensionmaven created a topic in Distributions and Loans, Other than QDROs
"We prepared a loan document for a client in December, 2019, at that time, prime rate +2%, and loan issued at 5.75%. With the COVID suspension and re-amortization, would the interest rate need to be the same? Since the new re-amortization can not go beyond the original term of the loan, and this participant only made 3 loan payments prior to suspension, the new loan amount plus accrued interest from date of suspension through 12/31/20 at the same 5.75%, yields a higher monthly payment than the existing amortization schedule. That does not make sense."
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austin3515 created a topic in Correction of Plan Defects
"When a participant has a small voer-deposit, and there have been gains, in lieu of calculating the applicable gains can we just withdraw the principal? I looked it up in the EOB so I think the answer is no, but the terminology is throwing me a little because I'm referring to a "corrective distribution" just an overdeposit. I assume there is no distinction, but asking anyway because we do spend a lot of time making sure we take as much money as possible from an NHCE which seems silly. 6.j.(1) Losses. If the Earnings are negative, a corrective contribution or allocation does not have to reflect a net loss incurred under a defined contribution plan. See section 6.02(4)(a) of the EPCRS Procedure. Note that this exception to reflecting a loss applies only to a corrective contribution or allocation. A corrective distribution is required to reflect net losses.6.j.(1) Losses. If the Earnings
are negative, a corrective contribution or allocation does not have to reflect a net loss incurred under a defined contribution plan. See section 6.02(4)(a) of the EPCRS Procedure. Note that this exception to reflecting a loss applies only to a corrective contribution or allocation. A corrective distribution is required to reflect net losses."
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Ken McDonnell created a topic in Other Kinds of Welfare Benefit Plans
"The Consumer Financial Protection Bureau (CFPB) and Federal Deposit Insurance Corporation (FDIC) are co-hosting a joint webinar on Thursday, January 14, 2021, from 2:00 pm to 3:15 pm ET. The webinar will help you better understand the CFPB’s Your Money, Your Goals and the FDIC’s Money Smart materials. These financial education resources help people enhance their knowledge and skills to meet financial goals. In the webinar, you will learn what these materials have in common and how they differ. Participants also will learn how they can work together to help serve communities. Join us to learn more about these available materials. Webinar Details Date: Thursday, January 14, 2021 Time: 2:00 p.m. – 3:15 p.m. Eastern Time To register, please click here. https://web.cvent.com/event/3b6817a4-3469-4d6d-9a55-beb77c6233de/summary The session will showcase the FDIC’s Money Smart and the CFPB’s
Your Money, Your Goals materials and resources. Presenters will describe how the materials can be used in different settings and how to access these free resources."
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Here are the most recently posted jobs on EmployeeBenefitsJobs.com, a service of BenefitsLink:
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Cherry Bekaert LLP
Telecommute / Virginia Beach VA / Rockville MD
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Quantech Pensions LLC
Anaheim CA
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Nova 401(k) Associates
Telecommute / Houston TX / Dallas TX / Scottsdale AZ
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Nova 401(k) Associates
Telecommute / Houston TX / Dallas TX / Scottsdale AZ
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Blue Ridge ESOP Associates
Telecommute
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Blue Ridge ESOP Associates
Telecommute
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HowardSimon, Inc.
Deerfield IL
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The MandMarblestone Group, llc
Telecommute / Philadelphia PA
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Pollard & Associates, Inc.
Telecommute / Hunt Valley MD
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Benetrends Financial
Lansdale PA
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