401(k) Q&A | Plan & Industry Content From DWC - The 401(k) Experts

How Can We Improve ADP/ACP Test Results Without Offering Safe Harbor?

DWC 06/18/19

Facts My architectural firm sponsors a 401(k) plan. We have 38 architects and 2 administrative assistants. We currently provide a matching contribution to participants and, some years, a profit sharing contribution too. I’m reluctant to utilize a safe harbor design, because I really value the vesting schedule on our employer contributions to help ...

Spouse or Not a Spouse? That is the Question...of the Week

DWC 06/4/19

QOTW - 6.4.2019 - Spouse or Not a Spouse - Plan Compliance

Facts Our company has sponsored a 401(k) plan for a while and although it’s not new to us that certain situations - from beneficiary designations to annual nondiscrimination testing - might require us to provide information about spousal relationships, we are seeing that different types of relationships, and statuses, are becoming more commonplace.

What Does Safe Harbor Mean, Exactly?

DWC 05/28/19

QOTW - 5.28.2019 - What Does Safe Habor Mean Exactly - Plan Compliance

Facts When we set up our new 401(k) plan last year, we decided not to add a safe harbor provision because we were not in a position to commit to the required contribution. Then we heard our TPA say something about our deferral deposits fitting within the safe harbor deadline. Now I’m just confused.

Which Compensation Do You Use When Your Company Fiscal Year is Different Than Your Plan Year?

DWC 05/21/19

Facts When we set up our 401(k) plan, our partnership operated on a fiscal year that ran from July 1st to June 30th. We set the 401(k) plan year to line up with our company’s fiscal year. We recently changed our company’s fiscal year to follow the calendar year and didn’t think to notify our TPA to discuss the impact to the Plan. Now, they are ...

Top Heavy vs. ADP: What's the Difference?

DWC 05/7/19

Facts As a plan sponsor, I do my best to review the annual compliance reports my TPA sends to me, but to be honest, it might as well be written in a foreign language. For example, several of our participants were recently required to receive corrective refunds due to contributing too much for 2018. I thought it was because our plan was top heavy ...

Who are Leased Employees & Are They Eligible for my 401(k) Plan?

DWC 04/16/19

QOTW - 4.16.2019 - Who are Leased Employees and Are They Eligble for my 401k Plan - Plan Compliance

Facts I own a small manufacturing company that specializes in office supplies, and I sponsor a 401(k) plan for my employees. One of my former employees, Tim Halpert, worked full-time with me for the past several years but recently left to work for a staffing agency called Prestige Worldwide. Tim was a great employee for many years, and Prestige ...

What is the PBGC & Does it Cover our Cash Balance Plan?

DWC 04/9/19

QOTW - 4.9.2019 - What is the PBGC and Does it Cover our Cash Balance Plan - Plan Compliance

Facts Our company is thinking of setting up a cash balance plan. In our research about what that entails, we keep running into information about the PBGC and paying premiums.

What is the Form 8955-SSA and What Does It Do?

DWC 04/2/19

Facts Our company has been very fortunate to have low turnover over the years. Those that have left either were not eligible for our 401(k) plan, or they had very small balances and had their accounts forced out when they terminated. We recently did have one longer-term employee leave us. She was an active participant in our plan and has a ...

How (and for How Long) Can I Extend the Deadline to File our Form 5500?

DWC 03/26/19

Facts We’ve had our retirement plan for a couple of years now and feel that we are finally getting the hang of the various deadlines for our plan. There is just one deadline that I always have trouble remembering: the extended deadline for filing our Form 5500 with the DOL. I’ve heard that if we extend our corporate taxes, it is the due date of ...

What Common Compliance Issues Should We Be Watching For?

DWC 03/19/19

QOTW - 3.19.2019 - What Common Compliance Issues Should We Be Watching Plan - Plan Compliance

Facts Our company sponsors a 401(k) plan, and we want to make sure we do everything correctly. We have a great staff and have put processes in place to help ensure we operate the plan in a compliant manner. With all the moving parts, however, there is still a concern that we might miss something.

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