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Message Boards Digest

May 4, 2022

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

Patricia Neal Jensen created a topic in Church Plans

Need Plan Document (Cycle 3) for Money Purchase Plan Sponsored by Non-Electing Church

"A Non-Electing Church sponsors a Money Purchase plan which needs to be restated for Cycle 3. We understand there's a newly allowed type of pre-approved plan for this situation under IRS procedures but our current document provider is not offering one. I found some notes published by ASC on such a document but have not located anything else. Does anyone know of a document provider with a pre-approved plan document (exempt from the requirements of Title I) for a Money Purchase plan sponsored by a Non-Electing Church?"

No replies yet   |    Click Here to Add a Reply

KJames created a topic in Retirement Plans in General

Trust as a Named Beneficiary

"A participant passed away in 2020. The family and employer just notified us in 2022. One of the named beneficiaries is a trust. The claim form states that 'The Trustee of the Trust must certify whether the underlying trust beneficiaries are designated or non-designated beneficiaries as defined by Section 401(1)(9)(E) of the Code. The trustee must provide the certification by October 31st of the year immediately following the participant's death.' Because 2 years already have passed, what's the impact of the trustee not having met that October 31 certification date?"

4 replies so far   |    Click Here to Add a Reply

dmwe created a topic in Other Kinds of Welfare Benefit Plans

Election Change Deadline After a Status Change

"Our RTO document doesn't specifically address this, and I can't find it in the regs.

After someone has a new child, so a Status Change event, is there any sort of deadline that they have to make an election to start contributing to a Dependent Care FSA?

It seems like during the 12 week or so maternity leave, the decision for child care could change a couple of times before something is decided. So I can see where an employer might give the employee a pretty long period of time before they shut off the ability to make a DCA election after this Status Change event.

Can someone point me to something in the Regs that states a definitive time period?"

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kimso created a topic in 401(k) Plans

One Employee in Excluded Class Mistakenly Allowed to Defer

"I have a plan that excludes a class of employees in the plan document but one of the employees of this class was allowed to defer during the plan year. What is the best corrective action? Distribute the deferrals? Or is there anything else that can be done?

Can't fix payroll since this is from last calendar year. There were also a few employees that did not meet any of the eligibility requirements that were allowed to defer. Can we do a retroactive amendment to let them in? If that's OK, would that be an issue with the employee above who is considered excluded?"

5 replies so far   |    Click Here to Add a Reply

legort69 created a topic in 401(k) Plans

Missed Deferral Opportunity -- Mid-Year Correction or Max Out Option

"A payroll system error caused a participant deferral to be deducted at a lower amount and as a result they did not get the opportunity to max out in 2021. The problem continued until April 2022. A 2021 QNEC for the MDO will be forthcoming. However, for 2022, do you give the participant the option to max out (maybe receive more match) or accept the QNEC? If they accept the 2022 QNEC then they cannot max out to the 402(g) limit for 2022 because the 402(g) limit takes into consideration the MDO. Or would you fund a 2022 MDO QNEC and notify the payroll admin to reduce the 402(g) limit for 2022?"

1 reply so far   |    Click Here to Add a Reply

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