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February 9, 2024

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

Belgarath created a topic in 401(k) Plans

LTPT, Top Heavy and Safe Harbor

"In a safe harbor plan that does NOT use the OEE provision, LTPT employees can be excluded from all employer contributions, and the plan does not automatically lose its top heavy exemption, assuming only contributions made are deferrals and safe harbor match or nonelective. However, the loss of top heavy exemption remains in place if the safe harbor plan uses the OEE exclusion, even though LTPT employees are still permitted to be excluded from safe harbor and top heavy if the plan is top heavy. Have I got that right?"

5 replies so far   |    Click Here to Add a Reply

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

Single Plan for Spouses with Separate Businesses?

"Husband owns his S corp, Wife owns her S corp. Business are not related (different fields). Can one DB plan cover both H&W? State NC. Just trying to keep the admin cost on a low side."

8 replies so far   |    Click Here to Add a Reply

Tax Cowboy created a topic in Employee Stock Ownership Plans (ESOPs)

Constructing a USTC Rule 213 Reply

"It's been a while since I filed a Declaratory action for retirement plan disqualification filed in USTC. In the Reply to Govt Answer am I correct the only paragraphs I should reply to relate to where the Govt has burden of proof. Under USTC rule 213 says: Rule 213 Form and Content: 'In response to each material allegation in the answer and the facts in support thereof on which the Commissioner has the burden of proof, the reply must contain a specific admission or denial; however, if the petitioner lacks knowledge or information sufficient to form a belief as to the truth of an allegation, the petitioner must so state, and that statement will have the effect of a denial. ' I've always thought that unless there's a new issue under US tax court rule 142 the burden almost always stays with petitioner. Or of course if the court shifts burden under 7491. Which seems to be very rare. Thoughts on how do you prepare your Reply? Do you Reply to each Answered paragraph? Thoughts and comments appreciated."

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Santo Gold created a topic in Distributions and Loans, Other than QDROs

1099-R Mega Backdoor Roth

"Solo 401k plan. Owner doing the mega backdoor Roth. Contributes $30,000 after-tax in 2023, converts $30,100 to a Roth IRA in 2023. The 1099-R would be as follows: box 1: $30,100.00 box 2a taxable: $100.00 box 5: $30,000.00 Box 7: G Does this look correct?"

2 replies so far   |    Click Here to Add a Reply

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

Written Loan Repayment Procedures Unintentionally Changed with Restatement

"We have a client that was using a Custodian that allowed for participant loans to be repaid using ACH. The Plan permits a terminated participant, making payments via participant ACH, who has elected to defer receipt of a final distribution, to continue making scheduled installment payments on the participant's outstanding loan. When the Plan document was restated as a Post PPA document, the ACH/terminated participant repayment loan provisions were not maintained. Since 1/1/22, the Plan has not been operating in accordance with their written loan policy. (They continued to allow for ACH/terminated participant repayment because it was never their intent to remove this provision. The Post PPA loan policy change was a Scrivener's error.) We are thinking about doing a retroactive amendment to return the ACH/terminated participant repayment loan provisions to the Post PPA document. Is this an appropriate correction?"

No replies yet   |    Click Here to Add a Reply, Inc.
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