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Roth, Roth and More Roth – as Far as the Eye Can See

Adam C. Pozek 01/31/23
Congress seems to be in a continual love fest with two retirement concepts – automatic enrollment and Roth contributions – and SECURE 2.0 (S2) continues the trend for both. I guess it’s not surprising. Automatic enrollment means more tax-deferred contributions (and, therefore, less tax revenue), whereas Roth contributions kick the tax can down the ...
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Anticipating a New Hire - You Might Change Your Mind

DWC 01/28/21
Sponsoring a retirement plan can provide significant benefits to a company (and its participants). But with great benefits comes great responsibility…responsibility to follow all of the various regulatory requirements. Since these plans provide hundreds of billions of dollars in tax deductions each year, Congress and the various agencies want to ...
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DWC's Thanksgiving Dinner Prep Playlist

DWC 11/24/20
Facts All year long we've been leaving little rock 'n' roll Easter eggs in our Cash Balance Corner feed. ICYMI: Each post title incorporates one of our favorite songs. And for our 20th century rock music fans, our retirement plan-savvy business owner, Robert Smith's name should ring some bells. (Hint: His music has the cure for what ails you.)
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How Do Furloughed Employees Impact Our Plan at Year-End?

DWC 11/17/20
Facts Like many businesses, we had to furlough some employees earlier this year in response to the coronavirus shutdowns. We’ve been fortunate enough to bring back a few of these employees, but a number still remain in limbo. As we approach year-end, we’ve started wondering how this might affect our 401(k) plan and potential company contributions.
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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 ...
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Is There a Plan Design that Combines the Benefits of Automatic Enrollment and Safe Harbor?

DWC 10/15/19
Facts My company sponsors a 401(k) plan, and we fail the annual ADP test pretty consistently. We really want to increase participation; not only to help our test results, but also to encourage our employees to save for retirement. Automatic enrollment would help with participation, but we would have to set the default rate too high in order for it ...
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Can Higher Than Normal Turnover Affect my 401(k) Plan? | Part 3 of 3: The Results

DWC 02/19/19
Facts In last week’s QOTW, you provided some tools we could use to identify which participants were affected by our decision to close one of our locations, and to calculate our actual turnover rate for purposes of determining whether a partial plan termination has occurred. We’ve performed the review, and our minimum turnover rate will exceed 20%. ...
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Can Higher Than Normal Turnover Affect my 401(k) Plan? | Part 2 of 3: Doing the Math

DWC 02/12/19
Facts Last week, we asked whether the turnover we are expecting as a result of closing a facility would have any impact on our 401(k) plan, and you mentioned a partial plan termination. We have some follow-up questions. As a quick recap, we are in the process of closing one of our manufacturing facilities. Some of those working at that location ...
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Can Higher Than Normal Turnover Affect my 401(k) Plan? | Part 1 of 3: Overview

DWC 02/5/19
Facts Our company designs and manufactures boats. Due to some advancements in technology, we will be closing one of our older facilities. While we offered those workers the option to relocate to one of our other facilities, many have elected not to do so and will be terminating employment. That group comprises roughly 20% of our total workforce.
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Can We Change our Plan's Vesting Schedule?

DWC 01/8/19
Facts We set up our company 401(k) plan soon after we started the business. At the time, being able to afford to make a match or profit sharing contribution seemed so distant as to not be worth thinking about. We were so focused on the only contributions being employee deferrals that we set the vesting schedule at 100% across the board. The ...
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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.