"I'm looking at a life insurance annuity inside of a 412e plan that has an account value that exceeds its guaranteed cash value because more than just the premium payments have been paid to it it over the years. Is this a cause of concern?"

"DB/DC combo - top heavy plans.

DC is 3% non-elective safe harbor, PS requires 1000 hours + last day rule.

DB required 1000 hours for accrual.

Top heavy requirement is met under the DC plan, i.e., DB is not required.

Gateway is 7.5%, i.e., 3% of safe harbor plus 4.5% of PS.

Participant works 750 hours during the year and is employed at the end of year.

Does not get a DB accrual though covered.

Needs to get 4.5% of PS as must satisfy gateway. Correct?"

"Is ftwilliam the best (or just one of a few) in marketplace to help create ESOP documents? Are they owned by Wolters Kluwer? I'm looking for a resource (or service provider, i.e., an attorney or TPA) familiar with ESOP document design and plans with participants in excess of 100. Along with knowledge in participant notice requirements for material changes. Not looking for freebies. And willing to pay to consult."

"Employee's gross comp is $2,000. They contribute $1,900. What's their ADP rate using net compensation? Is it $1,900/$100?"

"I note on these message boards there have been several discussions on the IRS elimination of the 5-year cycle to amend certain ESOP Plan documents. (Rev. Proc. 2016-3?)

I thought I read that at this time there is still no requirement to apply for and receive a determination letter for prototype ESOP Plan documents. I can't seem to find a cite/rev proc/advisory opinion/case that says this.

I note the Form 5300 and 5307 (determination of adopters of modified volume submitter plans) seem to still be available on IRS website.

[1] Is there even a process to apply for a determination letter for an ESOP Plan document? Or is this still in a state of flux given the pandemic and new admin in White House? [2] Is it your usual practice, notwithstanding no requirement to apply, to submit the 5300 or 5307?

The ESOP Plan document I've used over the recent years was designed by a volume submitter (who has a letter from 2009 time frame). The esop plan document and AA itself has been updated with changes in the law over the years. And this ESOP Plan document and AA was provided recently in a TEGE audit with a successful no change outcome."

"The following formula is provided for computing interest rate for Form 5500:

i = 2 x I / (A + B - I)

where i= effective rate of return, I= total interest or net gain/loss A=Beginning Balance, B=Ending Balance. It seems to work fairly well but can't find the source or prove it myself. Has anyone else looked into this?"

"A 401(k) plan has 1000 hour and last day requirement to receive match--fails the 401(m) ratio% test for 2020. In regards to correcting Coverage, the plan document states:

'The Employer Contribution will also be allocated to individual Participants in the order specified until the Plan satisfies the minimum coverage requirements. A Participant, and all similarly situated participants, will be included only if necessary to satisfy those requirements.'

It then goes on to say you start with participants that worked the most hours that were still employed on the last day of the year, then work your way down to terminated participants with the most hours....

We need to bring in several NHCE that terminated prior to 12/31/2020 to pass the ratio% test for 401(m). We have two HCE that are not benefiting under 401(m) because they terminated employment before 12/31/2020 who worked more hours than any of the NHCE we are bringing into the match. Does the 'only if necessary to satisfy those requirements' allow us to ignore those two HCE's? I sure hope so because we can't pass if we have to include those two HCE."

"I represent a labor-management relations fund which is intended to comply with Section 302(c)(9) of the Labor-Management Relations Act, under an amendment adopted by the Labor-Management Cooperation Act of 1978. The DOL has consistently taken the position that since such funds provide neither a pension benefit nor a welfare benefit that they are not subject to ERISA. Ironically, there are a number of court cases in which such funds sue to recover delinquent contributions under ERISA Section 515 which have been accepted by the courts (presumably because the opposing party never raised the ERISA issue as a defense). Does anyone have a sample or specimen trust agreement that can be used for such an arrangement to the extent it is funded by employer contributions?"

"I think it's time for plan documents to update the NRA to something more realistic.... such as 66 1/2, to be more in line with Social Security retirement ages."

"We have a plan that has a short plan year for 2021. A participant exceeded the 415 limit because of the short-plan year. Would the distribution code be 'E' or '8'?"