Bird

Yes it is possible. Generally, your employER contribution is going to drop from a max of 25% to 6%. After taking into account the max 401k deferral and the 6% max employER, the remaining money already contributed might be able to be considered an after tax contribution. If you are a sole proprietor, it's fairly easy. If you are operating a corporation and getting W-2 income, not so easy. It might be considered aggressive because in theory the money going in should be designated as what it is when it goes in.

Just to be argumentative, to put the Schedule C proprietor on the same playing field as an employee, they can make contributions during the year. The only possible problem is exceeding the 100% of pay limit and that is solved by removing the 415 excess.

So sorry to hear this. I go back to PIX days.

I don't want to go down the rabbit hole of making decisions based on facts and circumstances. We* set a limit of 2 loans or maybe 1 loan, and then just apply the policy without having to think about it. A defaulted loan is still on the books and counts. if it is repaid, so be it; that frees up availability. The government doesn't care if one or two loans default; 4 or 5 I can see being problematic although the next enforcement of allowing "too many" loans might be the first. *"We" being the TPA. Our (small) plans look to us for guidance.

I'd really like to know the answer to this. PS, you come up with some really bizarre situations that just "happened" as if by random chance. The practical problem is that the IRS has $80,000 in error. There is a way to get it back but I never had to figure it out so don't know. But that's what has to happen, along with corrected reported as noted above. The real problem is that someone didn't think enough about the ramifications of paying the estate and withholding $80,000 (!). I think we would all be curious to learn how this could happen. FWIW I have never heard the term "cross tax correction."

You ask a great question(s). I'm nearly fully retired now; just can't wean myself from this board and some direct work activities, but sometimes wondered the same thing towards the end. I couldn't quite bring myself to pull the trigger but we too spent an awful lot of time getting "our" account statements to equal the recordkeepers'. Most of the time it was some kind of import problem, but often enough there was some kind of contribution deposit error or whatnot that wouldn't be caught without going through the whole process, so I always felt that was part of our job (catching such errors) and kept it up. But it's frustrating when you know others aren't doing that. It's not exactly "right" but a solution to the TH testing and 5500 count is to import everything from the vendors and not worry too much about reconciling. Being forced to deal with crappy systems like FasCor is one of the reasons I got out. And of course the incessant changes in the law.

IMO, no. These investments/tail-wagging the dog scenarios are almost always problematic.

There are several possibilities. One is that the reports are wrong; that is, the vested calcs are messed up because of the loan(s). I wouldn't immediately assume that but I've seen it. Another is that loan fees could be eating at your account. Yes your non-loan balance might increase overall due to contributions and loan payments, but you might be experiencing losses due to loan fees. Loans might have fees of $150 or more at inception, plus ongoing quarterly fees. Not judging, but if you still have loans, you might consider increasing your loan payments rather than increasing your contributions. Conventional wisdom says to maximize your contributions, but if it means you have to turn around and borrow for small expenses, then that is self-defeating.

Unfortunately different situations might have different "right" documents. For the vast majority of us (?) using pre-approved documents, "it is what it is." What prompted someone to say "IRS regulations state that grandchildren are not eligible to receive distributions" is beyond me. And then I guess that "misunderstanding" (being polite; it's just stupid) led them to not pay the granddaughter even though the plan says she is entitled (although I remain skeptical of that detailed language, sorry). Plus you have the son bringing in an attorney, which is going to cost him half of what he received, if this plays out. It's a cluster f*ck. The lesson here is, IF YOU DON'T KNOW WHAT YOU'RE DOING, DON'T DO IT.

That's a key detail. I still find that language unusual, but it seems to clearly state that the granddaughter was entitled to half. I think they have to try to get half back from the son - good luck with that. I'm always curious about these types of posts - what is your role here?

I agree with prior posts. I think it is highly unlikely the granddaughter is entitled to anything. In the absence of a named beneficiary, the plan has a beneficiary under default provisions. It's not like this is a gray area; it is simply a matter of reading the plan provisions to see who the beneficiary is. That is typically going to be spouse, otherwise children, otherwise the estate. (as fmsinc notes, there may be a longer list; it might even be shorter, as in - spouse, otherwise estate). The only way the granddaughter gets anything is if she is the daughter of a deceased child (i.e. not the son's daughter) and the plan says that the benes are "issue per stirpes" (i.e. per branch of the family tree) but I've never ever seen that in a default. (All right, I suppose the plan designation could be "estate" and it is possible the granddaughter is is entitled to something under the will or intestate laws.) I repeat, this is not mysterious/subject to discretion/gray area.

No, I think you are correct.

So you're saying that Company A should allow the former Company B employees to contribute to the B plan from their A compensation? No, I don't think so. (I think) the transition rules are for a scenario where A buys B and B continues payroll.

How did they overdeposit if they use individual accounts? (American Funds does not have "brokerage" accounts, unless it is through a different brokerage account.)

I agree that the TPA should not be providing investment advice, but there's potentially* a lot more non-investment advice to be provided, other than "you need to get a bigger bond." If that's all you say then the advisor will tell the sponsor that you said it is ok and it only costs a little bit more for bonding, and they'll buy it and then you and they have to deal with the other issues - liquidity, valuation, etc. *If this is a publicly-traded REIT then our typical concerns about real estate may not apply.