Topic Archive: DWC

Pension Pontifications | Q4 2019

DWC | 12/12/19

Written by Keith Clark, Managing Partner

The end of the year is a time for reflection, and this year we have a lot to look back on.

We entered our 20th year of business this past May.  Eleven years ago, we started our TPA practice with the goal of differentiating ourselves from the standard industry model.  Our emphasis was understanding that we are a professional services firm, and that means providing consistently excellent service.  Our clients, advisors, and recordkeeping service providers must always come first. 

I never understood why I had to sit in a waiting room when I visited a doctor or dentist when I had a pre-established appointment. The old school service model where their time is more important than mine does not work anymore!  We know our clients’ time is valuable and they should never have to wonder when we will respond to them or be in doubt about the status of their deliverables.  This is why we developed the DWC Way - our service expectations and basic tenets:

- As originally published in our Q4 2019 newsletter. Didn't get it? Sign up here.

Read More

Do 401(k) Loans Impact a Participant's Credit Score?

DWC | 12/10/19

Facts

Our 401(k) plan allows participants to take loans from their accounts.  We have a written policy that describes how the loans work and spells out the requirements that the plan and participants must follow.  Among other details, the loan policy indicates that payments must be made via payroll deduction.

Read More

What is a Suspense Account and Can We Use Our Forfeiture Account Instead?

DWC | 12/3/19

Facts

The annual compliance report that our TPA provided to us indicates that we over-funded matching contributions for certain employees and instructs us to transfer the excess amounts out of the affected participants’ accounts and into a plan suspense account.  The only problem is that I am not sure what a suspense account is.  When I spoke to our recordkeeper, they said we have a forfeiture account but not a suspense account.

Read More

Tradition vs. Taste: What Classic Thanksgiving Dish Do You Secretly Dislike?

DWC | 11/26/19

Facts

Every year we gather with family and friends to stuff ourselves silly in honor of the first harvest here in the New World. Since that time, families have perfected and passed down Turkey Day recipes that have become staples on the dinner table. 

Read More

When More (Plans) Isn't Merrier: We've Got a Fix for That!

DWC | 11/21/19

Stop us if you’ve heard this one before – a SEP, a SIMPLE, and a 401(k) walk into a bar…unfortunately, there’s not a great punch line at the end of this one.  Instead of some good laughs, this situation is a recipe for some issues in need of attention.  While it might be unusual for a single company to establish one of each, it is not nearly as far-fetched to discover that related companies may have setup separate types of plans for their respective employees, one with a SEP or SIMPLE and another with a 401(k) plan.  This isn’t necessarily a problem with respect to the 401(k) plan, but the SEP and SIMPLE rules restrict how those types of plans can co-exist with others.

Read More

Are Rehires Immediately Eligible for our 401(k) Plan?

DWC | 11/19/19

Facts

We just rehired an employee that used to work for us but who terminated almost 4 years ago.  She was eligible for our 401(k) plan during her previous tenure but took a distribution of her account shortly after she left.

Read More

What is a Short Plan Year and What Does It Mean for My Deferrals?

DWC | 11/12/19

Facts

Our company operates on a calendar tax year, but our 401(k) plan runs on a fiscal year ending each June 30th.  It is a real hassle to manage two different year-ends, so we asked our TPA about aligning the two.  They said we could amend the plan to make that happen, but there is also something about it creating a short year which would require us to go through year-end compliance testing twice during the transition.

Read More

What Do You Do with the SIMPLE IRA Sponsored by the Company You Just Acquired?

DWC | 11/5/19

Facts

My company recently acquired another firm.  As we work to combine all of our operations, we’ve discovered a few differences in our employee benefits, specifically our retirement plans.  While we’ve sponsored a 401(k) plan for several years, the company we bought has a SIMPLE IRA.  I’ve done a little research and found that when a company offers a SIMPLE, it cannot also sponsor any other types of plans.

Read More

Is It Possible to Split Eligibility to Allow for Deferrals but to Postpone Safe Harbor Contributions?

DWC | 10/29/19

Facts

We allow new employees to join our 401(k) plan on the first of the month after they are hired.  They become eligible to make deferrals and also receive the company safe harbor contribution at that time.  We don’t have high turnover, but employees who leave often do so within the first year of joining us.  We don’t mind allowing new hires to contribute to the plan out of their own paychecks, but since safe harbor contributions must be immediately vested, it feels like we are wasting company money by giving a contribution to someone who might leave in a relatively short timeframe.

Read More

DWC News Update | Two Years in the Making: The Final IRS Hardship Distribution Regulations Are Here

DWC | 10/24/19

It’s been a while, but we finally have them! Late last month, the IRS published the final hardship distribution regulations, nearly two years after Congress passed the Bipartisan Budget Act and the Tax Cuts and Jobs Act. The good news is that this final version follows the proposed version very closely. So closely in fact, that the IRS outright states in the final version that any plan that followed the proposed regulations will satisfy the final regulations.

Read More
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.