Message Boards Digest

March 23, 2023

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

401 Chaos created a topic in Cafeteria Plans

Puerto Rico Company Wants to Set Up Cafeteria Plan for its Continental US Employees

"Is is possible for an entity incorporated in Puerto Rico (and/or controlled group of PR corporation) to establish a Code Section 125 cafeteria plan for its employees in the continental US. The vast majority of employees of the controlled group are located in Puerto Rico and so generally wouldn't be expected to pass the eligibility or benefits test if a cafeteria plan must count all employees within the group for testing purposes as the PR employees are not generally eligible or able to benefit from the cafeteria plan under current PR law as I understand it. I'm not sure if there is any sort of SLOB or similar workaround that may be commonly attempted in these situations. Thanks"
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Leopurrd-401k created a topic in Retirement Plans in General

Electronic Filing Procedure for Form 5330

"Hi! 5330's can now be electronically filed -- which is wonderful news! But it looks like it follows regular 1040 tax filing procedures, not the 5500 (since its not going to the DOL). I'd really like to try and move towards electronic filing, but the documents on the IRS webpage are a bit scary. Does anyone know if there are providers out there at will assist retirement recordkeepers with this? We use FT Williams for 5500 purposes and they currently aren't supporting it."

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Peter Gulia created a topic in Communication and Disclosure to Participants

What Is the Penalty Amount to Show in an ERISA-Rights Notice?

"A summary plan description's ERISA-rights notice includes this: If you request materials from the Plan and don't receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan administrator to provide the materials, and pay you up to $nnn a day until you receive the materials, unless the materials were not sent because of reasons beyond our control. What is the current amount?"

3 replies so far   |    Click Here to Add a Reply

rblum50 created a topic in 401(k) Plans

Rolling Real Estate into an IRA

"Any recommendations for an IRA custodian that will accept Real Estate from a 401(k) Plan?"

1 reply so far   |    Click Here to Add a Reply

David Olive created a topic in IRAs and Roth IRAs

Missed RMD for Prior Year and Account Owner Now Deceased

"Account Owner of IRA failed to take RMD for 2022 (account owner was incapacitated and under conservatorship). Account owner subsequently passes away in 2023. The question is, how does 2022 RMD get addressed? Are the beneficiaries liable for the 2022 RMD?"

1 reply so far   |    Click Here to Add a Reply

L. S. created a topic in 401(k) Plans

SECURE 2.0: Automatic Enrollment Exception and Employee Count

"I'm hoping for help and clarification on this section of SECURE 2.0. With the automatic enrollment exceptions for small businesses with 10 employees or less, I am curious on how the employee count is defined. Is this looking at the total number of employees who received wages, tips, or other compensation from the employer (what would be reported on Form 941) regardless of whether all employees are still actively employed? Or is there another definition? As an example, - If Employer A has 8 employees at the start of the year. - 4 employees terminate mid-year. - Employer A then hires on 3 more employees before the end of the year. At the end of the year, they have 7 active employees. Would this employer be considered to have a total of 11 employees for that tax year and then be subject to the automatic enrollment requirements under SECURE 2.0?"
1 reply so far   |    Click Here to Add a Reply

matthny created a topic in 401(k) Plans

RMD for 5% Owner Who Is Still Contributing to the Plan

"Wondering if we can simplify the management of a small plan, owner is subject to RMD under Section 1.401(a)(9)-2(b)(3) 5% rule and currently contributing to the plan. Is it allowed to reduce the transfers of cash in such a situation, for example:

  1. RMD is $10,000.
  2. Contribution is $15,000.
  3. Contribute $5,000 and do not remove assets from plan.

It seems economically the same to the plan, and the owner still receives their 1099-R for $10,000 so they are paying appropriate taxes, just not sure if there is any rule that I might be overlooking here?"

8 replies so far   |    Click Here to Add a Reply

ClintonF created a topic in 401(k) Plans

Are Most 401(k) Plans Self-Directed?

"I am looking for credible sourcing of the percentage of 401(k) plans which claim 404(c) status. Any ideas? I thought an eFast search would get me there but no luck."

2 replies so far   |    Click Here to Add a Reply

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