TRA MAKES NEWS HAPPEN

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  CASE OF THE WEEK – Plan Permanency

  July 5, 2023 - Business owners who have already set up or are considering establishing a qualified retirement plan need to understand that the IRS expects this arrangement to be a long-term commitment. While plan sponsors have the option to terminate their qualified retirement plans, the IRS only accepts "business necessity" as a valid reason for abandoning the plan within the initial years of establishment. Continue
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  CASE OF THE WEEK – ERISA Budget Accounts

  June 23, 2023 - Is it permissible for a plan sponsor to utilize the ERISA Budget Account within the company's 401(k) plan to finance employer contributions? The ERISA Budget Account within a 401(k) plan can be utilized by the plan sponsor to cover plan administrative expenses, excluding settlor expenses. However, it cannot be used to offset employer contributions. To determine the specific guidelines regarding the use of revenue sharing payments, it is advisable to refer to the terms outlined in the governing plan document. Continue
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  CASE OF THE WEEK – When does a 401(k) deferral become a catch-up contribution?

  June 2, 2023 - There may be more to catch-up contributions than the average person realizes. An employee salary deferral becomes a catch-up contribution when it exceeds the lowest of a legal limit, a plan-imposed limit or the ADP limit. Continue
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  CASE OF THE WEEK – Retirement Proposals in the 2024 U.S. Budget

  May 26, 2023 - When the President took office, America faced acute and historic challenges: a once-in-a-century pandemic; an economy gripped by the most severe downturn since the Great Depression; a worsening climate crisis; and a legacy of racial injustice. From the first days of his Administration, the President moved swiftly to tackle these challenges, deliver results for the American people, and ensure the Nation emerged stronger than ever. Two years later, while significant challenges remain, America has made historic progress under the President’s leadership. Continue
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  CASE OF THE WEEK – What are PS 58 Costs in my 401(k) Plan?

  May 19, 2023 - If the plan uses deductible employer contributions to purchase life insurance for a participant, then the cost of the protection (PS 58 cost) is reported on Form 1099-R. The participant must include the amount in taxable income for the year the premium is paid. Continue
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  Plan Sponsors Ask…

  May 16, 2023 - Our company has been growing rapidly over the past two years, creating many current and near-future ground floor opportunities for younger, less-experienced workers. In discussing the benefits of our retirement plan, what do we need to know about the attitudes and views these younger workers have about saving for retirement? Continue
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  CASE OF THE WEEK – Partial Plan Termination and the Applicable Period

  May 12, 2023 - Based on facts and circumstances over the applicable period, a company could be deemed to have a partial plan termination. The participants affected by the partial plan termination must become 100 percent vested in their account balances upon termination. Plan sponsors should monitor their companies’ turnover rates and amendment activities to be aware of potential partial plan terminations. Continue
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  Mistakes Happen

  May 9, 2023 - As a plan sponsor, at some point you are likely to discover that a plan failure or error has occurred — especially after the plan testing season concludes. Mistakes do happen and you won’t be alone. A recent report published by the American Society of Pension Professionals and Actuaries (ASPAA) studied over 3,200 small business plans1 and found that nearly half of them failed the top-heavy test. Continue
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  Plan Sponsors Ask…

  May 2, 2023 - Our plan committee, with the help of our plan advisor, is considering reducing the number of investment options available to our employees. We currently have 27 investment options — how does that compare with industry averages? Continue
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  CASE OF THE WEEK – 401(k) and 403(b) MEPs

  April 28, 2023 - While the law permits both 403(b) MEPs and 401(k) MEPs, it is not possible to have one MEP that covers both types of plans. The IRS treats 403(b)s and 401(k)s as unlike plans and, therefore, incompatible, for the purpose of plan-to-plan transfers or mergers. Continue