…more than the lesser of the base percentage or 5.7%. A couple of important keys to keep in mind: The allocation method or formula for each retirement plan is spelled out in its plan document and the plan would need to adopt an amendment if…
Reporting plan compensation right is integral to plan success. Compensation is the basis for determining contribution allocations, compliance testing as well as employee status. It is also one of the top sources of plan errors that can have long term, expensive consequences. The start of…
As a financial advisor, you know that the people who exercise control and authority over the management of a retirement plan’s assets are fiduciaries. So are professionals who provide investment advice with respect to those assets. In most cases, plan sponsors understand that they,…
…as number of participants, amount of assets in the plan, distributions made to service providers, and types of investments. Audit Requirements: Once a plan reaches 100 participants, an annual audit must be sent to the DOL along with the Form 5500. Among other things, this…
Answering the “Why Us?” Question Whether retirement plans are core to your practice or part of a larger strategy to help clients, you’ll compete more effectively if you successfully communicate how you differentiate yourself from other advisors. From the perspective of many business owners,…
…staff. Another approach involves outsourcing all retirement plan administration. Third-party administrators (TPAs) can be hired to provide nearly all the services that are needed to effectively run a plan. This strategy can relieve plan sponsors from nearly all the daily administrative tasks that a plan…
…the account balances of key employees is greater than 60% of the total assets held by the plan. We know that the goal of many company owners is to maximize how much they can contribute each year to their retirement. So, to avoid uncertainty about…
…– which determines if the account balances of key employees is greater than 60% of the total assets held by the plan. We know that the goal of many company owners is to maximize how much you can contribute each year to your retirement. So,…
…assets and maintain personal data on participants, which can make them tempting targets for cyber-criminals. Plan fiduciaries have an obligation to ensure proper mitigation of cybersecurity risks. Key Items Responsibilities to manage cybersecurity risks Retirement account online basic rules to reduce the risk of fraud…
…provide an ACA notice to participants can cost a plan up to $1,899 per day. And the list goes on. Penalties for plan reporting and disclosure failures are considered “settlor” expenses and cannot be paid out of plan assets. That means, the plan sponsor is…
…gift card. Whatever the incentive, they cannot be paid for with plan assets. The term “de minimis” is not defined; a suggested safe amount is $25. Clarification is needed on whether the amount should be treated as compensation. Plans can increase the cash out limit…
…the retirement plan—is a common oversight. For example, Company A purchased Company B in an asset sale and Company A did not take on Company B’s 401(k) plan. The person who had been identified as Company B’s Plan Administrator and signed the Forms 5500 no…