What fees and expenses can be paid for by a plan? In general, fees and expenses associated with the on-going administration of a retirement plan may be paid from plan assets provided they are necessary and reasonable. Certain expenses known as "settlor" expenses, however, cannot be paid for from plan assets. What is considered reasonable? In order for an expense to be reasonable, the Department of Labor (DOL) requires all of the following conditions be satisfied: The expense must be

Deposit Rules for 401(k) Plans One of the most common mistakes made by 401(k) plan sponsors is failure to deposit participant contributions (i.e. 401(k) deferrals/Roth contributions) and loan payments in a timely manner. Having said that, it is worthwhile reviewing the rules and consequences of making late deposits. What are the rules? In general, the Department of Labor (DOL) requires that participant contributions and loan payments be deposited as soon as the amounts can be reasonably segregated from the general

On August 24, 2016 the IRS released Rev. Proc. 2016-47 providing a new “self-correction” program for taxpayers who miss the 60-day window for rolling over a distribution from an IRA or qualified retirement plan. Prior to this guidance, a taxpayer who was unable to complete a rollover within the required time frame could only qualify for a tax-free rollover after the 60-day period by seeking IRS approval. This new guidance allows plan administrators, IRA custodians and IRA trustees to accept

When can a participant receive a distribution from a retirement plan while still working? It depends. A plan may (but is not required to) allow participants to receive in-service distributions. In addition, certain conditions must be satisfied which are set forth under the Internal Revenue Code, regulations and IRS guidance. Are the rules different depending upon the type of contributions? Yes. Elective deferrals (i.e. 401(k) and Roth contributions) can only be distributed while a participant is still working under limited

In January 2016, the IRS issued Notice 2016-16 providing long-awaited guidance on when changes can be made to safe harbor 401(k) plans mid-year. Previous IRS guidance (formal and informal) seemed to indicate there were only limited circumstances under which a safe harbor plan could be amended prior to the first day of the following plan year. Thankfully, this notice reflects an apparent shift in the IRS’s position and provides sponsors of safe harbor 401(k) plans with much greater flexibility throughout