"One of our clients maintains a profit sharing plan, one individual has a life insurance policy owned by the plan and he has terminated employment. As far as I can remember, the choices are either to surrender the policy for its cash value and the deposit the cash value into the participants' individual account -- just a change in investments OR participant buys the policy for the cash value from personal funds. When he purchases the policy, where does that money go? Part of the general assets of the plan, or into the individual participant's account? If the money stays in the plan, is it allocable to the remaining participants?"

"We have a client that is currently utilizing a 2 month eligibility requirement. They are changing the eligibility requirement to 12 months effective 1/1/2022. My question is an employee hired September 1, 2021 would be eligible as of November 1, 2021. The employee begins deferrals on Nov 1, 2021. on 1/1/2022 when the eligibility requirements change would the employee then be required to wait until September 1, 2022 to begin contributions? Or would they be somewhat grandfathered in under the 2 month requirement?"

"Small company (4 HCEs, of whom one is a Key Employee, and 3 NHCEs) has had a SH match plan for years.They recently got very successful and want to add a Cash Balance for 2021 with Key Employee getting $200,000 pay credit and as little as possible to others. One of the HCEs has no balance in the current 401(k) because he hasn't made any deferrals. The client wants to continue to give him nothing even though the plan is top-heavy and will be even more top-heavy with the CB in place.

Can this HCE be excluded from the Cash Balance plan and get nothing under the DC plan too, even though profit sharing contributions will need to be made to NHCEs to meet the gateway?

My thought is that he would need to get 5% of pay in the DC plan to cover TH minimum but I can see an argument to give him nothing or 3% of pay in DC because the HCE would be a participant in only one plan."

"Looking for billing software that works well with quarterly billing, flat fee+ per participant formulas. Anyone had great success with a particular package? Not Quickbooks."

"A plan's sponsor wants to provide an automatic contribution arrangement for some specified classes of non-highly-compensated employees, but not others. (All Highly Compensated Employees would be excluded.) May a plan provide this without tripping on a tax-qualification condition? Is it feasible to provide this using an IRS-preapproved document without losing reliance on its IRS letter?"

"I have a participant in a plan who signed a TEFRA election to delay RMD processing. This is the only one I've ever seen. The participant is now fully retired as of 12/31/2020 so I believe he now has no choice but to take an RMD for 2021. Per the election signed in 1983 it states, 'Specifically, I request that funds held for my benefit shall not be subject to distribution prior to my retirement, death or other separation from service with the corporation, or any successor employer.' Because he's now retired, it appears he has to start taking his RMD. Is there anything I could be missing?"

"Plan terminated. MOST of the assets paid out. One recalcitrant participant keeping brokerage account open, and not heeding calls to distribute the account. About $50k in there. Participant is NOT lost. She still works for the company. In fact, she answers the phone! Can the plan administrator still force her out? What is the cite?"