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Message Boards Digest

October 13, 2022

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

pam@bbm created a topic in Form 5500

5500 Schedule of Delinquent Contributions -- Include Lost Earnings in the Reported Amount?

"Question about preparing the attachment Schedule H/I Line 4a Schedule of Delinquent Participant Contributions. Do you include the calculated lost earnings in the amount or is it just the late contribution amount? The 5500 instructions only discuss the contribution. I have someone telling me to include the earnings."

1 reply so far   |    Click Here to Add a Reply

t.haley created a topic in Health Plans (Including ACA, COBRA, HIPAA)

Applying ACA Rate of Pay Safe Harbor to Employee Paid Both Salary and Hourly Pay

"Looking for guidance on how an employer applies the rate of pay affordability safe harbor to an employee that is paid both a salary (for work performed in one position) and an hourly wage (for work performed in second position). My first thought is to just use the W-2 safe harbor, but the client wants to explore the other possibility. I found language in the final regs allowing the employer to apply different safe harbors to different categories of employees but nothing about applying a safe harbor to an employee with two categories of pay. Any ideas?"

1 reply so far   |    Click Here to Add a Reply

david rigby created a topic in Defined Benefit Plans, Including Cash Balance

Social Security Level Option

"Have you seen any study about possible anti-selection (e.g., higher average mortality than the overall population or plan population) with respect to a Social Security Level Option?"

No replies yet   |    Click Here to Add a Reply

tsrl01 created a topic in Correction of Plan Defects

Self Correction of Newly Discovered Issue Despite Prior Submission Under VCP for Other Issues?

"We submitted our plan to the IRS under VCP about 6 months ago and just found an issue completely unrelated to the VCP submission. I do not see any requirements that we can't still self correct the recently identified problem, but wanted to see if anybody had a different opinion. In my mind, because there isn't a specific exclusion, as long as the issue would otherwise qualify for self correction, I can."

1 reply so far   |    Click Here to Add a Reply

JHalligan created a topic in Retirement Plans in General

Avoiding Controlled Group Status by Selling Stock So as To Drop Below 80% Ownership

"I got a request today asking for clarification on whether two companies are a controlled group. There are partners who have common ownership; one partner owns 80% of a related business. If he sells his interest, bringing it under 80%, will that be enough? I have a feeling that the other partner(s) have enough ownership to make this idea a non-starter. The businesses have seperate DC plans, and have been advised by someone else that they may need to amend those plans, but I thought there was a grace period for that. (I am assuming this is to provide substantially equal coverage between the two companies)."

1 reply so far   |    Click Here to Add a Reply

justatester created a topic in 401(k) Plans

ACP Failure In Year of Participant's Death -- Refund Was Made to Surviving Spouse

"Owner/participant retires 12/31/2021, dies shortly after. Plan fails the ACP portion of testing. Owner is due a 'refund.' Money has been moved to a spouse's account as beneficiary. The transaction was treated as a 'funds on deposit' and transferred to the spouse. No 1099-R was generated.

Question: because the money has been moved, we need to make the distribution. Whose Social Security number should the distribution be taxed under?

Also, because the 'transfer' took place in February of 2022, would the plan be considered to have been timely corrected?"

No replies yet   |    Click Here to Add a Reply

Jakyasar created a topic in 401(k) Plans

Correction of Late 401(k) Deferrals for 2020 and 2021

"Looking at a 401(k) plan for 2020 and 2021. Both years had deferrals deposited late. No VFCP calculations were made nor any adjustments deposited into participant accounts. No 5530s filed. How can this be corrected?"

10 replies so far   |    Click Here to Add a Reply

Bird created a topic in Distributions and Loans, Other than QDROs

Notice 2022-53 -- When Do the Unpaid 2021 and 2022 Distributions Get Paid?

"The notice says that the excise tax will not apply for distributions not taken in 2021 or 2022 under the 10 year rule. But I don't think they say when those distributions must be taken. That is, do they get pushed to 2023, or do you do the RMDs over the remaining 10 years, or what? Or did I miss something? The notice makes reference to the intent to publish final regs and I guess that's where the answers will lie. Seems weirdly incomplete though."

2 replies so far   |    Click Here to Add a Reply

metsfan026 created a topic in Defined Benefit Plans, Including Cash Balance

PBGC Payment Date Deadline is October 17 -- Is That the Date of Required Receipt?

"Quick question regarding the PBGC payment. I know it's due by 10/17/22 this year. [1] Does it have to be received by the PBGC by that date, or [2] Does it have to be postmarked that date Thanks! Have a few that waited till the last minute, so have to let them know if they have to overnight the check or just get it in the miail."

No replies yet   |    Click Here to Add a Reply

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