"Pension plan unmarried participant elects life annuity with 10 years certain and names three children as beneficiaries for one-third each. Participant dies before the 10-year guarantee period ends so remaining payments are due to the beneficiaries. However, one of the three beneficiaries also died, shortly after the participant but before receiving any benefits if that matters. Are remaining benefits now paid to the two surviving beneficiaries at 50% each, or does the deceased beneficiary's portion go to that person's estate? The plan is silent, as are the SPD and benefit election/beneficiary designation forms. Nothing specifically allows for beneficiaries to also elect their own beneficiaries so I'm inclined to say split remaining guaranteed payments between two remaining children. Thoughts? Do you think it different if beneficiary had started receiving payments and then died? Unless there is a specific legal avenue we must pursue (reason for my question) I think we ultimately need to have Plan Administrator interpret and decide upon how proceed."

"We have a client that turned into a co-op, so all 14 employees own an equal percentage of the company (about 7%). So technically all employees are greater than a 5% owner and therefore an HCE. Am I correct in saying that there would be no compliance testing?"

"I have a 401k/PS/SH plan (participants choose their own funds and are in individual SDBAs) Their provider is telling them it's mandatory now to have a form opting in or out of participation. I've searched through Secure 2.0 and I don't see anything that references that. Am I missing something? Are they describing it incorrectly? They don't have an QACA or EACA or anything like that."

"Our payroll system allows catchup contributions all year long, as a separate 'bucket', distinct from other contributions (401k, Roth, and 401a). There is no control on whether the employee is on target during the year to qualify for catchup once they designate catchup contributions. We noticed an issue with some employees not deferring enough to meet the statutory limit, however the catchup functionality in the payroll system is programmed to stop at $7500, regardless of the amount of the deferral or satisfaction of the underlying statutory limit by the employee. In the case where an employee either doesn't qualify for all or part of the catchup because they didn't meet the statutory limit but designated catchup deferrals, the plan 'recharacterizes' the catchup at year's end, but doesn't make any adjustment for match on the recharacterized funds, even if the employee wasn't provided their full match for the deferrals that year.

'Example on this is that in 2023, one employee was stopped $10,000 lower than the elected deferral to the 'catchup bucket' (deferral was designated at approximately $17,510 into catchup) and didn't meet the statutory limit due to this cap (the employee contributed a total of $9000 to the pre-tax and Roth accounts). The employee ended the year with ~$16,000 deferred instead of what she believes she designated (~$26,000).

'I have two questions based on this situation: [1] is stopping the contributions to the 'catchup bucket' at $7500 generally a problem or an operational error when the employee elects a higher catchup amount than $7500? [2] is there an issue with not retroactively contributing matching funds to the recharacterized funds if the employee didn't already receive their full match for the year?"