"This is a discretionary match that was paid throughout the plan year. The plan document states the match computation period is payroll by payroll. My understanding is that the computation period dictates the mathematical components used to determine each participant's matching contribution. If the computation period is each pay period, then the formula is applied to deferrals/compensation earned only during that specific payroll period. Therefore, a true-up would only be applicable in a plan where the match computation period is annual (regardless if the match was actually PAID per payroll or annually). So the question is whether the true-up is possible with a per payroll computation period, and also does a true up provision need to be included in the plan document? I'm not sure if the mechanism is simply implied by the choice of computation period, or if it needs to be explicitly stated. What makes the situation even more confusing (and concerning), is that the plan document includes a last-day rule as a condition for receiving match contributions. Isn't the plan in operational failure if they fail to forfeit/refund all of the match paid to the employees during the year? Additionally, the employer wants to exclude terminated employees from their hypothetical true-up. I don't see how they can exclude them from a true-up (if they can make the true-up), without also acknowledging that they are not entitled to any match accrued during the plan year. As you can see, a lot of red flags here and a few inconsistencies with the plan document."

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"A non-owner participant was told that since she was over 72 she had to take an RMD for 2022, slightly over $1,000. Does this mean she has to continue in the future?"

"Some brothers and sisters just found out, after ten years, that their companies are not a brother-sister controlled group. (No brother-sister aggregation for this test.) They have always operated their 401(k) plan as if it were 'single employer' with everyone getting the same contribution. The 401(k) and (m) tests were also operated on a 'single employer' basis, which is the problem because those tests need to be company by company in a multiple employer plan. Maybe if they could find the data, the 401(k) and (m) tests would be passed. The document is set up since the beginning of time as a single employer plan, also a problem. Here's the question, and I am sure the answer is No, but it would be great to hear something different. Is there any permissive way that a plan can elect to aggregate as if it were single employer, even if there is no controlled group or affiliated service group but a family relationship among the owners?"

"Someone (Paychex) convinced a very small Employer to join a PEP containing an EACA provision in early 2022. The ADP test fails (terribly) for 2022 so the goal is to get them out of the PEP and establish a new single-employer plan with a more meaningful plan design as soon as possible.

• Can they leave the PEP mid-year (i.e., now) or do they have to wait until 12/31/2023? The plan document doesn't specifically address leaving the PEP.
• They intend to transfer assets from the PEP to the new 401(k) plan, so would this be accomplished through a 'spin-off' (vs. plan termination)?
• What is the earliest effective date the new single-employer plan without automatic enrollment and including a safe harbor provision can be established?"

"2022 excess contribution to Bank HSA. The HSA account has a 'cash' component and an 'investment' component (segregated and listed separately on the monthly statement) -- the cash portion earns .01% APY and the investment component is in mutual funds. Excess deposited in cash account on 12/19/2022, distribution from cash account on 2/14/2023 -- interest for 1/1/2023-1/31/2023 was about 4 cents. Taxpayer requested distribution of excess, and Bank calculated excess earnings. Bank used the entire account balance (cash and investment portions) to calculate earnings on the excess, and distributed $110 earnings on a $1,825 excess. The excess was a result of a severance from service and the taxpayer no longer participated in a HDHP -- Bank told taxpayer he could fund the remaining HSA contribution available from private funds as opposed to payroll deductions (this was not correct). Upon severance, taxpayer was able to draw down from cash/investments, but the investment account was frozen for additional contributions. I understand the HSA excess/earnings rules follow IRA rules, but is there a different calculation for earnings when the contribution went into a segregated cash account and distributed from that cash account (.01% APY), and never subject to investment experience in the mutual funds?"

"The plan document for a new 401k plan is written with a January 1, 2022 effective date, even though the deferrals do not commence until a date which is later than January 1, 2022, in order to avoid an initial short Plan Year, and the plan document does not include a special effective date for the deferrals. Does this result in a missed deferral opportunity?"

"For many years (and before turning 50), Jane has been, and still is, a partner in a business organization. With many partners, Jane's capital interest and her profits interest both have been always less than 5%. Now in her 90s, Jane remains an equity partner, still has her capital interest, and gets a draw on her profits interest. Jane still performs some personal services in the business. Assume the business organization's individual-account retirement plan requires no more than is needed to meet Section 401(a)(9) to tax-qualify. When is Jane's required beginning date?"

"Owner over age 50 defers $6,500 and receives a Profit Sharing contribution of $61,000. Does the $6,500 get testing for ADP?"

"Section 316 of SECURE 2.0 seems to allow the adoption of discretionary amendments improving accrued benefits up until the tax filing due date including extensions. IRC 412(d) seems to only allow reflection of such an amendment in funding if adopted within 2.5 months after the close of the year. Do we think that these new amendments adopted after 2.5 months but before the date indicated in SECURE 2.0 will fall in the same camp as 1.404(11)(g) amendments adopted after 2.5 months? Does this now trisect the window for retroactive plan amendments in terms of their effect for defined benefit plans? The SECURE 2.0 provision is not effective until 2024 years so we have time to digest this...."