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

Finding Balance with Form 5500

It’s rare that updates to the Form 5500 warrant little more than a yawn, if anyone other than those who prepare the forms even notice. That is NOT the case with changes issued by the Department of Labor today. In nearly 250 pages of new regulations, revised instructions and sample forms, the DOL announced some changes for the 2023 plan year that ...

When Is the Best Time to Set Up a Safe Harbor 401(K) Plan?

DWC 06/17/21

Facts We have been thinking about setting a safe harbor 401(k) plan and have heard that there are some pretty stringent timing requirements depending on some of the provisions we select.

Designing Your 401(k) Plan for Combined Testing

DWC 05/6/21

Thousands of 401(k) plans are designed each year to promote savings in the most cost-effective manner. Most are established as stand-alone plans and will remain that way for their entire existence. Some, however, are initially set up as stand-alone, only to be paired with a cash balance plan down the road. Since most cash balance plans are ...

Overtime Is Up and Bonuses Are Down: Will This Year's Irregular Compensation Impact our Retirement Plan?

DWC 12/1/20

DWC 401(k) Q&A: Will Irregular Compensation in 2020 Impact Your Retirement Plan?

Facts We sponsor a 401(k) plan for our employees and provide a company matching contribution to those who defer. Our plan specifies that in calculating that match, we only consider employee base pay and exclude “irregular” forms of pay (specifically bonuses and overtime). This allows us to be more precise when we are building the expected cost of ...

Your Definition of Compensation Isn't in the ERISA Dictionary? We've Got a Fix for That.

DWC 08/27/20

Getting creative with the plan’s definition of compensation can be an effective way to target benefits, budget your benefit dollars, and maintain consistent benefit levels from year to year. However, with that creativity comes added layers of testing and compliance to concern yourself with. And, if you sponsor a safe harbor plan, those rules can ...

What Are My Options (and Deadlines) for Implementing a Retirement Plan This Year?

DWC 08/11/20

Facts We’ve been debating implementing a 401(k) plan for 2020. After much back and forth, we’ve decided its “a go!” for this year. Since we are still in a more relaxed summer vacation mode, we’d like to wait until sometime this fall to really get rolling on implementation.

Can We Offer Additional Matching Contributions Without Losing our Safe Harbor Status?

DWC 08/4/20

Facts We currently sponsor a 401(k) plan for our company. While we certainly want to be able to provide meaningful benefits to the owners, our goal is to encourage all our employees to save more for their retirement, and to reward those who do. We were failing our annual testing, so we implemented a safe harbor provision to provide a matching ...

Retroactively Decided Not to Make Safe Harbor Contributions for Your HCEs? We've Got a Fix (or Two) for That!

DWC 05/28/20

DWC 401(k) Q&A Correction of the Quarter: Retroactively Decided Not to Make Safe Harbor Contributions for HCEs?

If you’ve been with us for a while you’ve heard us say a few things time and again. First, the rules and regulatory agencies do not allow plans to disproportionately favor highly compensated employees (HCEs) relative to the non-HCEs. Second, a plan sponsor must be very careful about how and when it implements or removes benefits from the plan. ...

Can We Suspend our Safe Harbor Contribution Mid-Plan Year?

DWC 03/24/20

Facts Given the current uncertainty in the world economy and the unknown ongoing affects of coronavirus, I’m looking at all financial obligations for our company, and for opportunities to reduce risk. We currently sponsor a 401(k) plan for our employees and provide a safe harbor contribution equal to 3% of employee compensation.

Have the Rules for Safe Harbor 401(k) Notices Changed?

DWC 03/3/20

Have the Rules for Safe Harbor Notices Changed? | DWC 401(k) Q&A Question of the Week

Facts My company sponsors a safe harbor 401(k) plan and every year my TPA sends me a reminder to distribute a notice to participants. It’s not the biggest hassle but I’ve wondered if it’s really necessary that this same information be provided to participants each and every year.

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