Topic Archive: 401(k)

The 2019 Retirement Plan Contribution Limits

DWC | 11/1/18

The IRS has released the 2019 contribution limits! Since not everyone was awaiting them quite as eagerly as we were, here is a quick summary.

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Plan Sponsors & Fiduciaries: Here's What You Should Be Watching

DWC | 10/11/18

DWC stays on top of what's trending, and our self-proclaimed pension geeks often offer their insights in industry publications. As we transition into the fourth quarter the theme has been, "What Plan Sponsors Need to Know." Get caught up with this month's round up:

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Delinquent Deposits of Employee Deferrals? There's a Fix for That!

DWC | 09/27/18

While it might not seem like that big of a deal if 401(k) deposits are made a couple days or weeks late, the Department of Labor (DOL) considers those payroll withholdings to be plan money on the deposit deadlines regardless of where the money is physically located.  To the extent those monies are still in the plan sponsor’s control, the delayed deposit is treated as a prohibited loan of plan assets to the plan sponsor, which is a very big deal (not in a good way).  If that wasn’t motivation enough to fix the delinquency, the fact that late deposits must be reported on the Form 5500 each year until fully corrected (which is like waving a red flag in front of a bull, only the bull here is the DOL) certainly should be motivation to fix it.  Pronto!


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Breaking News: The IRS PLR on Student Loan Benefits in 401(k) Plans is Much Ado About Not Much

DWC | 08/21/18

We interrupt your regularly scheduled programming to highlight the IRS’ not-so-ground-breaking entrance into the world of student loan benefits in 401(k) plans.

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Retirement Planning & Regulatory Trends You Should Be Watching

DWC | 08/16/18

Feeling out of the loop on industry happenings this summer? DWC stays on top of what's trending, and our self-proclaimed pension geeks often offer their insights in industry publications. Get caught up with this month's round-up: 

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Decoding the Alphabet Soup: What's With All the Acronyms? | Part 1

DWC | 07/24/18

Facts

People in the retirement plan business sure do like their acronyms.  All these letters get thrown around, and I do not know what half of them mean.

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Here's What Happens to Your 401(k) After a Company Merger or Acquisition

DWC | 07/12/18

Corporate mergers and acquisitions can be stressful. When employees hear that their company is part of such a deal, they instinctively worry about their jobs. Even with reassurances that there's no need to worry about layoffs any time soon, employees should expect changes in their benefit plans, particularly their 401(k)s or other retirement savings plans. DWC Managing Partner Keith Clark highlights these changes in this article published by Kiplinger.

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Correcting a Failure to Withhold Deferrals from Eligible Compensation

DWC | 06/28/18

Facts

ABC Company maintains a 401(k) plan that includes the following provisions:

  • It operates on a calendar year.
  • Compensation is defined as W2 wages with pre-tax deferrals added back and no exclusions.
  • Eligible participants can defer up to the IRS limit $18,500 + $6,000 for those age 50 or older (2018 limits, indexed for inflation)
  • The company provides a match equal to 100% of the first 5% deferred by each participant, calculated using compensation and deferrals for the full year.

In addition to regular compensation, ABC pays performance-based bonuses at the end of each calendar quarter.

While compiling the year-end census, it was noted that the overall deferral percentages did not appear quite right for certain employees based on their elections.  On closer review, it was determined that employees who received quarterly bonuses did not have any 401(k) deferrals withheld from those amounts.  With no deferrals withheld, ABC also did not make the corresponding matching contributions.

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Can We Exclude Seasonal Employees From Our 401(k) Plan?

DWC | 06/5/18

Facts

Our company’s workload fluctuates throughout the year with big spikes during the summer. As a result, we often hire seasonal workers who help us out during the busy times, but do not work during the regular workload months.

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Can You Make Extra Payments on a 401(k) Loan to Pay It off Faster?

DWC | 05/29/18

Facts

A participant in our 401(k) plan took out a loan a couple years ago. She could only afford to make the bare minimum payments at the time, but is now in a financial position to pay down the loan more quickly.

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The views expressed in this blog are those of the authors and do not necessarily represent the views of any other person or organization. All content is provided for informational purposes only and is not intended to be tax or legal advice.