Message Boards Digest

September 22, 2023

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

Bcompliance2003 created a topic in Mergers and Acquisitions

Employee Notification of Being Bought?

"Few questions regarding employee benefits during an M&A [1] Does an Employer have to provide advance notice to its employees telling them the company is being sold? [2] The benefits are planning to end on the day of the sale, 10/2/23; when does the seller's benefits end? Would it be 10/2/23 or 10/31/2023 since their premiums for October are already paid for the month? [3] The plan is to allow the seller's employees enroll into the buyers plan retroactive to the date of the sale (10/2). However, the employees won't be officially onboarded yet as they will need to go through the full hiring process such as completing payroll docs, I-9s, etc. Because the seller's benefits will end on the date of the sale, our client doesn't want to wait until the onboarding process is complete to offer benefits. Could this be an issue? [4] If the benefits under the seller don't end until 10/31/2023, any potential issues if the buyer is the owner of the employees as of 10/2/2023?"

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Egold created a topic in Retirement Plans in General

Form 7004

"Is it necessary to include extension form with 1120? 1120 not filed electronically."

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ERISA-Bubs created a topic in 401(k) Plans

The 401(a)(17) Contribution Limit and Multiple Employers

"We have a 401(k) Plan in which several related (i.e. same controlled group) employers participate. An employee doesn't receive compensation in excess of the 401(a)(17) limit from any single employer in the Plan, but does have combined compensation in excess of the 401(a)(17) limit based on compensation received from the related employers. I know the 401(a)(17) limit is not combined (but rather a separate limit for each employer) if we are dealing with a multiemployer or a multiple employer plan (see Treas. Reg. Section 1.401(a)(17)-1(b)(4)). Since this participant is receiving combined compensation in excess of the limit from employers in the same controlled group, does that make a difference? Can we look at compensation from each related employer separately, or do we have to look at combined compensation from all related employers?"

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

New Cash Balance Plan for Recently Sold Company

"I have a company that just went through an asset sale that included the former employees. As of 9/1 there is only the owner left as an employee and he has income coming into the employer for the next few years. Would there be an issue starting a new CB plan effective 10/1/2023 with a short plan year and only covering the owner?"

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TPApril created a topic in 401(k) Plans

Auto Enrollment Trends

"I'm just curious the trends for auto enrollment between ACA, EACA and QACA? Are there many participants that take permissible withdrawals?"
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DavidO created a topic in Defined Benefit Plans, Including Cash Balance

Which Mortality Table to Use for Funding

"Plan Year: 7/1/22 -- 6/30/23; Stability Period: Plan Year. Assume 100% LS for Funding EOY Valuation. Using the annuity substitution rule for 430 funding, which 417(e) Applicable Mortality table should be used when valuing the LS -- 2022 or 2023? 1.430(d)-1(f)(4)(iii)(B) says to use 'the current applicable mortality table under section 417(e)(3) that would apply to a distribution with an annuity starting date occurring on the valuation date'."

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rblum50 created a topic in 401(k) Plans

Transfer 401(k) Balance to Individual IRAs When Participant Can't Be Found

"I have a terminated 401(k) that I am trying to remove all of the participants monies from before the end of this year. Several of the participants can't be located and/or won't return the distribution paperwork to the plan sponsor. It's my impression that the plan sponsor can establish individual IRA's for each of these individual's so that their monies can be removed from the plan trust and we can terminate the trust before the end of this year. Question: does anyone know of a financial institution that would establish individual IRA's without the participants signature?"

4 replies so far   |    Click Here to Add a Reply

52626 created a topic in 401(k) Plans

Timing of Deposits When Changing Recordkeepers

"Client deposits deferrals/loan payments on their payroll date. This means deferrals are funded in one day. Plan will migrate to Empower (formally Prudential) on 10/20. First payroll to be sent to Empower is 10/27. Issue: once the file is received, Empower will have a call with the client about the process to review and approve the file. This call will not take place until the file is received. Furthermore scheduling this call is first come first serve, so there is no idea when the first deposit can be funded. Client is concerned the deposit will be 3-10 days later than the normal deposit date. Client stated their auditors will flag the deposits as late. Question: Is there anything in the IRS/DOL guidance that grants a grace period for unusual circumstances? Our client is a former auditor and she feels the deposits will be deemed late."

3 replies so far   |    Click Here to Add a Reply

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