"Law firm that is a partnership. Bill and Mary and married and both work for the firm. Bill owns 5% profits interest and Mary owns 5% profits interest. When they reach RMD age, must they start the RMDs while they are still working? Neither one has more than 5% profits interest. I am reading several articles that state that the reference in 416 to the constructive ownership rules of 318 will require Bill to be deemed to own Mary's interest, and vice versa. Therefore they will each be deemed to have 10% profits interest and therefore must start the RMDs. My question is, 'what is the significance of 416(i)(1)(B)(iii)(I) which says that 'constructive ownership' only applies if a person owns more than 50% of the stock of a corporation, or (II) in the case of an employer that is not a corporation, principals similar to the principals of (I) apply. To me, this seems to be saying that Bill would not be deemed to own Mary's profits interest unless Bill owned 50%, and vice versa. So while 318 requires constructive ownership, it seems like 416 is saying that for purposes of determining a 5% owner, the constructive ownership rules will only apply if a person owns at least 50%. Thanks!!"

"I believe that you should be able to set up a solo 401k just as you would any other 401k but wanted to make sure that the automatic enrollment feature was available and that then you could also receive the government tax credit for this?"

"An employee was re-hired after incurring five 1-year breaks in service. He never took a termination distribution from the plan. Since he is now an active employee but not yet eligible to re-enroll in the plan, is he able to borrow against his account in the plan?"

"For services about an individual-account (defined-contribution) retirement plan, here's a few key due dates, and whether each is (or isn't) adjusted under the Treasury department's rule about a return or payment due on a Saturday, Sunday, or legal holiday."

"Let's say a 457f plan says participants balance becomes vested at age 55. The participant is currently 50. Can the plan be amended (At the employers election) to become vested at age 54 instead? What about 53? Is this strictly forbidden no matter what, or can these kinds of changes be made within certain parameters?"

"Suppose you have a state where state withholding is NOT mandatory -- let's use NY as an example. Can a plan refuse to do state withholding on a taxable distribution, since it isn't required, even if the participant WANTS to have state tax withheld? I know that many platforms will accommodate the request, but I believe it is not required. Thoughts?"

"A TPA friend of mine who still does a lot of ADP testing mentioned that this section of SECURE 2.0 could sink a lot of plans: Section 603, Elective deferrals generally limited to regular contribution limit. Under current law, catch-up contributions to a qualified retirement plan can be made on a pre-tax or Roth basis (if permitted by the plan sponsor). Section 603 provides all catch-up contributions to qualified retirement plans are subject to Roth tax treatment, effective for taxable years beginning after December 31, 2023. An exception is provided for employees with compensation of $145,000 or less (indexed). This is for 2024 so there is time to provide guidance but a lot of plans get around having to return excess deferrals to HCEs after a failed ADP test by recharacterizing deferrals for some HCEs as catch-up. Would this no longer be possible if the deferrals were all regular 401(k) as catch-ups would need to have been Roth?"

"For someone born in 1959, is 73 or 75 the “applicable age” that sets a required beginning date? The Consolidated Appropriations Act, 2023’s SECURE 2.0 Act of 2022 division includes this section 107: SEC. 107. INCREASE IN AGE FOR REQUIRED BEGINNING DATE FOR MANDATORY DISTRIBUTIONS. (a) IN GENERAL.--Section 401(a)(9)(C)(i)(I) is amended by striking “age 72” and inserting “the applicable age”. (b) SPOUSE BENEFICIARIES; SPECIAL RULE FOR OWNERS.--Subparagraphs (B)(iv)(I) and (C)(ii)(I) of section 401(a)(9) are each amended by striking “age 72” and inserting “the applicable age”. (c) APPLICABLE AGE.--Section 401(a)(9)(C) is amended by adding at the end the following new clause: “(v) APPLICABLE AGE.-- (I) In the case of an individual who attains age 72 after December 31, 2022, and age 73 before January 1, 2033, the applicable age is 73. (II) In the case of an individual who attains age 74 after December 31, 2032, the applicable age is 75.”. (d) CONFORMING AMENDMENTS.--The last sentence of section 408(b) is amended by striking “age 72” and inserting “the applicable age (determined under section 401(a)(9)(C)(v) for the calendar year in which such taxable year begins)”. (e) EFFECTIVE DATE.--The amendments made by this section shall apply to distributions required to be made after December 31, 2022, with respect to individuals who attain age 72 after such date. Someone born in 1959 attains 73 in 2032, and attains 74 in 2033. Someone born in 1959 fits both clause (I) and clause (II). Imagine six Congresses (for twelve years) begin and adjourn with no enactment of any revision. Is there any reading of this statute that harmonizes clause (I) and clause (II)? If not: Is age 73 or age 75 the applicable age for someone born in 1959. What is the reasoning for your choice? And here’s a perhaps more immediate question: A summary that explains a plan--whether a summary plan description or a summary of material modifications--must “be written in a manner calculated to be understood by the average plan participant, and shall be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan. A summary of any material modification in the terms of the plan . . . shall be written in a manner calculated to be understood by the average plan participant[.]” ERISA § 102(a), 29 U.S.C. § 1022(a). How would a summary you write explain the “applicable age” that sets a required beginning date?"

"Employer has a 401(k) Plan -- Plan A. Employer, for reasons as yet unknown, (although I suspect sales commissions MAY have been a factor, but maybe not) established another 401(k) Plan as well -- Plan B. Employer transferred most of the funds from Plan A to Plan B, but there was no plan merger agreement, no plan termination of Plan A, etc. The rest of the funds will apparently be transferred once there is no surrender charge. Can the employer just randomly transfer funds from plan A to Plan B? No option given to participants, it was just done -- and no distributable event such as a plan termination. I'm thinking this has VCP written all over it, although I'm not sure what the 'fix' would be. Am I missing something absurdly basic? Never have I seen anything like this...."

"Husband Owns 51% of CORP A with >50 employees Wife Owns 100% OF Corp B. Solo 401k. Only Employee. Both have their own 401k plans. CORP B does not derive any revenue from CORP A but they are in the same line of business (Consulting). Are these two considered Controlled Group or Affiliated Service Group? thanks"