Corrective distributions must be processed by March 15 for a failed ADP/ACP test for a calendar plan year. Take these steps to prepare.
ADP/ACP Testing Deadline
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Defined Contribution Categories
A Defined Contribution plan is a retirement plan in which employees contribute a fixed amount or percentage of their compensation to an individual account under the plan. Contributions are invested on the employee’s behalf and they will ultimately receive the balance in their accounts upon retirement. Examples of defined contribution plans include 401(k) plans, 403(b) plans, employee stock ownership plans, and profit-sharing plans. For-profit companies can offer a 401(k) plan to help their employees save for their future by giving them the opportunity to defer pre-tax or after-tax dollars via payroll deduction into their account and select from a diversified investment menu. 403(b) plans provide retirement benefits for employees of public school districts, hospital groups, or 501(c)(3) organizations in these non-profit business sectors. An employee stock ownership plan (ESOP) is an employee benefit plan that gives workers ownership interest in the company; this interest takes the form of shares of stock. Profit-sharing plans are a way for a company to share profits with its workers and align the financial well-being of workers with the company’s success. 457 plans cover retirement benefits for state and local government employees and some non-profit businesses. There are benefits to Employers for sponsoring retirement plans; research applicable defined contribution articles on the Watkins Ross blog. Our Watkins Ross retirement team has the experience and knowledge to help you design a plan to meet your business goals; connect with us here to learn more.
Who Retains The Beneficiary Forms?
A beneficiary form determine who is entitled to the defined contribution retirement plan benefits upon the death of a participant. Is your form current?
Defined Contribution Compliance Calendar
A qualified retirement plan must meet various requirements throughout the year, check out our defined contribution compliance calendar today!
Changes to Hardship Rules
Regulatory changes as a result of the Tax Cuts and Jobs Act of 2017 and the Bipartisan Budget Act of 2018 may impact certain provisions of your 401(k) Plan.
Year-End Required Minimum Distributions (Defined Contribution Plans)
Failure to take your required minimum distribution could result in tax penalties, such as a 50% excise tax on the amount that was not withdrawn.
Year-End Bonuses and Compensation (Defined Contribution Plans)
Your plan document will dictate if bonuses are excluded from the definition of compensation and special rules for the treatment of deferrals on bonuses.
Finding Missing Participants in Your Defined Contribution Plan
Finding missing participants can be frustrating but employers carry the responsibility to provide disclosures to them just as often as active employees.
Bipartisan Budget Act of 2018
The Bipartisan Budget Act of 2018 impacts hardship distributions from defined contribution plans.
Safe Harbor Plan Amendments
Do you or your clients have a 401(k) plan that could benefit from amending to include a safe harbor provision?
National TPA Day
John Hancock has declared October 16, 2018 the fourth annual National TPA Day as a way to acknowledge what TPAs do to make 401(k) plans work the way they should. We love helping our clients understand and implement retirement plans designed to meet their goals. As a...