401(k), 403(b), 457(b): Why Are the Rules Different?

Posted By: Maria Hurd, CPA Why Ask Why? Why should the rules that determine how and how much a person can save for retirement be different depending on whether the person works for a government entity, a nonprofit, or a for-profit employer? People are people, and their retirement needs are not different based on what type of entity employs them. … Continued

The Who, What, Where, Why, and How of Retirement Plan Audits

The Who, What, Where, Why, and How of Retirement Plan Audits

Posted by Chris Ciminera, CPA, QKA You (or your client) may have just found out that an audit is required for its retirement plan. Many questions may be running through your head such as Why must an audit be performed? What must be audited? Who performs audits? Who is required to have an audit? How is an audit performed? Well, … Continued

“Give it BACK!!!”…”No!”…”OK, Keep It!”

Posted By: Maria T. Hurd, CPA, RPA What if the Participant Already Spent the Overpayment from the Plan?     Ineligible or excess distributions from qualified plans happen all the time. In our last 30 years of auditing retirement plans, our distribution tests have uncovered all the following ineligible or excess distributions:   Hardship reason not met: A participant doesn’t … Continued

Why Should Taking a Hardship Distribution be a Hardship?

Posted By: Maria T. Hurd, CPA Taking a hardship distribution should not be, in itself, a hardship to a participant going through challenging times, nor should it be an administration hardship to the employer trying to help. Although obtaining documentation to substantiate a hardship is not, in itself, difficult, missing hardship backup is one of the most common operational errors … Continued

Party in Interest Versus Related Party

Posted By: Maria T. Hurd, CPA Transactions with Related Parties and Parties In Interest: What are the GAAP disclosure requirements? ERISA’s definition of a party in interest is broader than a related party as that term is defined by GAAP. Parties in interest include all entities and individuals that provide services to the plan; however, these entities may not necessarily … Continued

Form 5500 Penalties Increased by How Much?

Posted By Maria Hurd, CPA The SECURE Act increased IRS Late Filing Penalties for Form 5500 by how much? How can I avoid them? IRS Penalties Tenfold. That’s how much the SECURE Act (the “Act”) increased the penalty for the late filing of a Form 5500 –TENFOLD! Before the Act, the IRS could assess a civil penalty of $25 for … Continued

Correction Options for Retirement Plan Errors

Posted by Maria T. Hurd, CPA In a highly regulated industry with complicated rules that always have exceptions (except when the exception does not apply) it is inevitable that sooner or later a failure to follow the plan document will take place. Such operational errors can be corrected through the IRS Employee Plan Compliance Resolution System (EPCRS) in one of … Continued