Insights

Know Your Plan’s Definition Of Compensation It is important to understand the definition of “compensation” as defined by the plan and to distinguish between eligible and non-eligible compensation because a participant’s total earnings may not be entirely eligible for 401(k) deferrals. The plan document will dictate which types of earnings are deemed to be eligible…

What Is A “Blackout Period”? A blackout period results in a suspension of participant?s rights to make changes to their account, including features such as but not limited to: changing investment allocations, changing deferral percentages, requesting loans or distributions. A blackout period could occur for many reasons. The common two reasons a blackout period occurs…

Documenting Fiduciary Responsibility Maintaining and retaining documentation is one of the most important responsibilities of plan fiduciaries. Not only is it beneficial to have the appropriate documentation to support historical plan activities and participant elections regarding investment choices, distribution requests, loan requests, etc., it will also prevent confusion and problems down the road, and it…

Plan sponsors should be mindful as to which expenses are allowed to be paid out of the plan’s assets and which expenses are the responsibility of the plan sponsor. According to ERISA regulations, plan assets can only be used for two reasons: to pay benefits to participants, and to pay the reasonable expenses to administer…

Pursuant to section 29 CFR 2520.104-50, a plan administrator is not required to include the report of an independent qualified public accountant (“IQPA”) in the Form 5500 for the first of two consecutive plan years, one of which is a short plan year thereby resulting in a deferral of including audited financial statements until the…

The exclusion of up to $500,000 of gain* from the sale of a taxpayers’ primary residence is one of the sweetest plums the current Internal Revenue Code has to offer. Curiously, Section 121 of the Code — the governing authority for the exclusion — doesn’t define the term “principal residence.” Rather, it simply requires that during the…

An Accountant’s Perspective On The Mortgage Industry July 2011 Improving The Mortgage Lender’s Bottom Line The predictions seem to be holding true (well, the ones about mortgage volumes anyway): mortgage volumes were down dramatically for the first quarter of 2011. At the same time, expenses continue to increase thanks to continually more complex regulations, changing…