Safe Harbor 401(k) Plan Design Questionnaire

Transcription

1 Safe Harbor 401(k) Plan Design Questionnaire Please call Prime Plan Solutions at (888) , Option 4, if you have any questions regarding this Plan Design Questionnaire (Monday Friday from 8:30 AM to 6:00 PM Eastern Time). I. GENERAL PLAN SPONSOR INFORMATION 1. PLAN SPONSOR: (Legal Name of Business or Organization Establishing the Plan) 2. STREET ADDRESS: CITY / STATE / ZIP: COUNTY: 3. MAILING ADDRESS: (if different) CITY / STATE /ZIP: 4. PRIMARY CONTACT: Name: Title: Phone: ( ) E mail*: Fax: ( ) SECONDARY CONTACT: Name: Title: Phone: ( ) Fax: ( ) E mail*: *Plan Contact E mail address is required. Prime Plan Solutions uses e mail as the primary method of communication regarding your plan. 5. PAYROLL CONTACT: Name: E mail: Phone: ( ) 6. COMPANY TAX YEAR END: 1 of 10 Fax: ( ) 7. PLAN YEAR END: (Month) 8. PLAN SPONSOR S COMPANY TAX ID NUMBER: (1) (1) The Plan Sponsor must have its own Employer Tax ID. Sole Proprietors may not use their personal Social Security Numbers to sponsor a plan. 9. SIX DIGIT IRS CODE: (this should match the code on the business tax return) 10. BUSINESS STRUCTURE: Corporation S Corp. Partnership Sole Proprietorship L.L.C. L.L.P. Other (please specify) 11. BUSINESS FORMATION DATE: / / 12. HAS THE COMPANY EVER SPONSORED OR PARTICIPATED IN A QUALIFIED PLAN (Profit Sharing, 401(k), Money Purchase Pension Plan)? Yes No (If No, Skip to Question 13)

2 CURRENT ADMINISTRATOR INFORMATION: Name of Administration Firm: Contact Name: Street Address: Phone: ( ) City / State / Zip: Fax: ( ) E mail Address: PROVIDE CURRENT PLAN S TRUST ID NUMBER: PROVIDE CURRENT PLAN S EFFECTIVE DATE: DOES THIS PLAN HAVE ASSETS? Yes No NUMBER OF ELIGIBLE EMPLOYEES ESTIMATED PLAN ASSET VALUE WAS THIS PLAN FORMALLY TERMINATED WITH THE IRS? Yes No If Yes, please provide a copy of the Plan Termination Notice and Board Resolution. 13. TRUSTEES: (Two trustees are recommended, if possible) (a) E mail: (b) E mail: (c) E mail: 14. OWNERS AND OWNERSHIP (Additional information may be needed if the business owners are not individuals/ownership percentage should total 100%): Names Ownership % Family Relationship(s) to Other Owners OWNERSHIP IS THIS COMPANY PART OF A CONTROLLED GROUP OR AFFILIATED SERVICE GROUP? Yes No If yes, you are not eligible for this plan design. Please contact us to discuss our Choice and Choice Plus plans. *** Please contact your attorney or CPA to assist you in determining whether you are part of a Controlled group or affiliated service group. See Exhibit A. *** IS THIS COMPANY OWNED IN WHOLE OR IN PART BY A FOREIGN ORGANIZATION? Yes No If yes, please read Exhibit B and attach a signed copy to the completed Questionnaire. Name of Company Employer ID Number Business Structure 15. DOES ANY OTHER BUSINESS LISTED IN QUESTION 14 SPONSOR A QUALIFIED RETIREMENT PLAN? Yes No If Yes, Prime Plan Solutions may not be able to provide recordkeeping services for the Sponsor 16. FIDELITY BOND: (Check one) I currently have a Fidelity Bond that provides coverage for my company s qualified retirement plan. Fidelity Bond Carrier Amount of Bond $ I do not have a Fidelity Bond but will obtain one immediately. Please Note: A Fidelity Bond is required by Federal law for all plans except plans covering only the owners or plans without common law employees. If the Sponsor of an Owner Only Plan hires an employee who is eligible for the plan, the Sponsor must then purchase a bond. The Fidelity Bond should be specific for your plan and provide liability coverage to plan Trustees. You should contact your current business insurance provider for more information and assistance with adding a Fidelity Bond for your qualified retirement plan to your current insurance coverage. 2 of 10

3 II. PLAN DESIGN INFORMATION (for all plan types) 1. ELIGIBILITY REQUIREMENTS AND ENTRY DATES: (Specify an age, if desired and one Entry Date option) Option 1: Less than 12 Months; No Hours Requirement Entry Dates: Specify Age: Monthly (You may select any age up to and including age 21. If this line is Quarterly left blank, your plan will not have an age requirement.) Semi Annually Service Months (0 11): Option 2: One Year; 1,000 Hours Specify Age: (You may select any age up to and including age 21. If this line is left blank, your plan will not have an age requirement.) One Year of Service / 1,000 Hours of Service Required Option 3: No Age; No Service (Immediate Eligibility) No Age Requirement: No Service Requirement for this option Entry Dates: Monthly Quarterly Semi Annually Entry Dates: Monthly 2. DEFERRAL ELECTION CHANGES (2) ALLOWED: (Same frequency as Entry Dates is recommended) Election Change Allowed Monthly Election Change Allowed Quarterly Election Change Allowed Semi Annually (2) This election change only applies to the percentage of a participant s deferred compensation. Changes in Fund elections and in asset allocation may be requested at any time. 3. ROTH ELECTIVE DEFERRALS: Yes No The plan may allow Roth after tax contributions to be made by participating employees. These contributions are made at the employee s discretion. Roth after tax contributions are NOT excluded from taxable income at the time of deferral. Distributions of Roth after tax contributions (and earnings) may not be included as taxable income at the time of distribution if certain criteria are met. 4. EMPLOYEE DEFERRAL LIMIT: Eligible employees may defer up to 100% of compensation, not to exceed the limit in effect at the beginning of the calendar year. Participants age 50 or older may make an additional catch up contribution. The limits for 2013 are $17,500 for Elective Deferral and $5,500 for Catch Up. 5. PROFIT SHARING: Yes No The plan will include a discretionary pro rata non integrated formula with an equal percentage of compensation for each eligible participant. 6. HARDSHIPS: Yes No Hardship distributions are allowed from Pre tax Salary Deferral Contributions only (not including earnings). 7. IN SERVICE DISTRIBUTIONS: Yes No In Service Distributions may be allowed after age 59½ from all contribution sources except Roth Elective Deferrals. 3 of 10

4 8. EMPLOYER SAFE HARBOR PROVISIONS: (Select either A, B, or C) Selecting a Safe Harbor contribution in A, B, or C below will eliminate the need for the annual compliance testing by requiring a mandatory annual employer Safe Harbor contribution. Please note that employees must have the opportunity to defer three months of the year in order for the plan to meet Safe Harbor requirements. A. BASIC SAFE HARBOR MATCHING CONTRIBUTION: Plan Sponsor will calculate a Safe Harbor matching contribution on behalf of each eligible participant equal to 100% of the Elective Contribution (Salary Deferrals) not to exceed 3% of compensation, plus 50% of each Participant s deferral contributions in excess of 3% but not in excess of 5%. The Plan is intended to satisfy the 401(k) and 401(m) non discrimination tests by meeting the requirements for the 401(k) Safe Harbor methods. B. ENHANCED SAFE HARBOR MATCHING CONTRIBUTION: Plan Sponsor will calculate a Safe Harbor matching contribution on behalf of each eligible participant equal to 100% of the Elective Contribution (Salary Deferrals) not to exceed 6% with a minimum of 4% of compensation. Plan Sponsor elects to match Salary Deferrals at % of each employee s compensation. The Plan is intended to satisfy the 401(k) and 401(m) non discrimination tests by meeting the requirements for the 401(k) Safe Harbor methods. C. SAFE HARBOR NON ELECTIVE CONTRIBUTION: The Safe Harbor non elective contribution made on behalf of each eligible participant will equal 3% the participant s compensation regardless of any deferral contributions elected by the participant. The Plan is intended to satisfy the 401(k) and 401(m) nondiscrimination tests by meeting the requirements for the 401(k) Safe Harbor methods. 4 of 10

5 III. CHOICE OR CHOICE PLUS MODEL SELECTION With Prime Plan Solutions you have the opportunity to build your ideal plan structure. You can choose either the CHOICE or CHOICE PLUS model based on your plan s contribution and vesting needs. CHOICE plan model ($600 annual fee and $150 set up fee) 1. PROFIT SHARING: Yes No The plan will include a discretionary pro rata non integrated formula with an equal percentage of compensation for each eligible participant. 2. VESTING SCHEDULE: Immediate 100% vesting. CHOICE PLUS plan model ($1,100 annual fee and $500 initial set up fee) 1. COMPENSATION DEFINITION: For the plan year in which an employee first becomes a participant, the plan administrator will determine the allocation of employer contributions by taking into account compensation for the plan year or only compensation earned while a participant. The different compensation definitions apply only to the first year in which a participant is eligible to participate or the very first year a plan is effective. Plan year compensation is always used for subsequent years of participation, even if the participant chooses not to contribute for part of a year. CHOOSE ONE: PLAN YEAR COMPENSATION: The employee s compensation for the entire plan year. COMPENSATION WHILE A PARTICIPANT: The employee s compensation only for the portion of the plan year in which the employee is actually an eligible participant. 2. EMPLOYER MATCHING PROVISIONS: I will calculate and deposit Matching contributions every pay period, along with the employee deferrals (Must choose Compensation While a Participant in Section IV, Question 1) I will calculate and deposit Matching contributions annually after the last pay period based on the compensation definition selected above. 3. PROFIT SHARING ALLOCATION METHODS (FUNDED ANNUALLY): PRO RATA NON INTEGRATED FORMULA: Equal percentage of compensation for each eligible participant. PERMITTED DISPARITY TIERED FORMULA (SOCIAL SECURITY INTEGRATION): 100% integration of taxable wage base with a 5.7% applicable percentage. 4. VESTING SCHEDULE: Immediate Vesting 3 Year Cliff: Year 1 (0%), Year 2 (0%), Year 3 (100%) 6 Year Graded: Year 1 (0%), Year 2 (20%), Year 3 (40%), Year 4 (60%), Year 5 (80%) Year 6 (100%) Note: The plan trustee will be responsible for determining the proper vesting percentage for each eligible employee. Please note that a participant s vesting schedule cannot be reduced or decreased once they have entered the Plan. 5. YEARS OF SERVICE FOR VESTING: The plan may elect to exclude years of service completed prior to the effective date of the plan and prior to each participant s 18 th birthday when determining vesting. Unless you mark the box below, your plan will automatically include years of service from the participants hire date when calculating vesting. Exclude years prior to the Effective Date of the Plan and years prior to Age 18 5 of 10

6 IV. INVESTMENTS Please indicate which funds to include in the plan s investment lineup by placing an X to the left of each fund. A maximum of 15 mutual funds are allowed. Plans are required to select a default investment (mark with a D ) and are strongly encouraged to choose one of the highlighted funds since they meet the criteria of a Qualified Default Investment Alternative. Please consult your financial advisor for investment advice. LORD ABBETT INVESTMENTS ONLY; MADE IN SHARE CLASS: (check one) Class A Class R3 Advisors: Please refer to your firm s share class guidelines since certain share classes may be restricted. If Class A shares are selected for Lord Abbett funds, is a letter of intent attached? Yes No If Class A shares are selected for Lord Abbett funds, indicate the number of employees who will be currently eligible to participate in the plan. (This information will be used to determine whether Class A shares may be purchased without a front end sales charge. Class A share purchases may be subject to a front end sales charge. Certain purchases of Class A shares made without a front end sales charge may be subject to a contingent deferred sales charge (CDSC) of 1% if the shares are redeemed within 12 months of the purchase. Class R3 shares are purchased at Net Asset Value (NAV) with no front end sales charge and no CDSC when redeemed. They are subject to on going service fees. Domestic Equities American Century Heritage A Columbia Small Cap Core A Delaware Small Cap Value A Federated Max Cap Index R JPMorgan Equity Income A JPMorgan Large Cap Growth A MFS Growth R3 MFS New Discovery R3 MFS Research R3 Nuveen Santa Barbara Dividend Growth A Fixed Income American Century Inflation Adj Bond A Columbia Global Bond A Columbia Limited Duration Credit A Eaton Vance Floating Rate A Janus Flexible Bond S JPMorgan Core Bond A JPMorgan Government Bond A JPMorgan High Yield A Lord Abbett Bond Debenture A/R3 Lord Abbett Income A/R3 Lord Abbett Short Duration Income A/R3 Lord Abbett Total Return A/R3 Lord Abbett Us Government Money Market A MFS Bond R3 MFS Emerging Markets Debt R3 Alternatives Blackrock Natural Resources A Janus Global Real Estate S Please note: Prime Plan Solutions selection of funds may be subject to change. Visit our website for the most current lineup of funds. International/Global Equities Blackrock Emerging Markets A Janus International Equity S MFS Global Equity R3 MFS International Value R3 Thornburg Global Opportunities R4 Thornburg International Value R4 Managed Strategies American Century One Choice 2015 A American Century One Choice 2025 A American Century One Choice 2035 A American Century One Choice 2045 A American Century One Choice 2050 A American Century One Choice 2055 A American Century Strat Allc Conservative A Benefit FCI Life Strategy Conservative Growth Benefit FCI Life Strategy Growth D Benefit FCI Life Strategy Moderate Growth D Columbia Balanced A Columbia Income Builder A Columbia Thermostat A Lord Abbett Multi Asset Balanced Opportunity A/R3 Lord Abbett Multi Asset Income A/R3 Lord Abbett Multi Asset Growth A/R3 Manning & Napier Target Income K MFS Aggressive Growth Allocation R3 MFS Conservative Allocation R3 MFS Diversified Income R3 MFS Growth Allocation R3 MFS Lifetime 2010 R3 MFS Lifetime 2020 R3 MFS Lifetime 2030 R3 MFS Lifetime 2040 R3 MFS Lifetime Retirement Income R3 MFS Moderate Allocation R3 Templeton Global Balanced A DST Systems, Inc. may receive compensation with respect to plan investments, including, but not limited to, transfer agent, recordkeeping, shareholder servicing, 12b 1 or other fees. 6 of 10

7 Please read and consider the prospectuses for risks, applicable sales charges, conditions for purchases without a front end sales charge, and conditions for which a CDSC is applied. To obtain a literature on any of the funds, please contact your Investment Professional or visit Read the prospectus carefully before investing. V. ENROLLMENT MEETING VI. VII. E mail a copy of the Enrollment Kit to: Plan Sponsor Broker Please allow 3 5 business days for Prime Plan Solutions to create an Enrollment Kit. FINANCIAL ADVISOR / BROKER Financial Advisor Name: Dealer Firm: Branch #: Branch Street Address: City / State / Zip: Rep #: Phone: ( ) Fax: ( ) E mail: PLAN ADMINISTRATION NOTES Plans with more than 100 participants may be subject to additional Department of Labor reporting requirements, including the need for an annual independent audit of the plan at the plan sponsor s expense. Top Heavy Plan. A Defined Contribution Plan (e.g., a 401(k) Plan) is top heavy if the total of the accounts of all Key Employees exceeds 60% of the total of all accounts of all employees. In making the top heavy determination, the accounts of all plans sponsored by the same employer are aggregated. Please understand that the 401(k) plan is, or may become, top heavy. If the Plan is top heavy, a minimum employer discretionary contribution of 3% will be required for each non key employee who has satisfied the Plan s eligibility requirements and has not separated from service at the end of the plan year, regardless of whether such employee has completed 1,000 hours of service during the plan year and makes any elective deferrals. Our company has has not sponsored another retirement plan prior to the current plan. If we have sponsored another plan, I understand that we must review participant account balances and/or benefit distribution amounts in order to determine the top heavy status of the current plan. 7 of 10

8 VIII. BANKING INFORMATION / ACH AUTHORIZATION Please indicate the type of bank account: Checking Account Savings Account If the bank account is for an affiliated company, please provide the company name: Bank Name: Bank Phone Number: ( ) Bank Routing Number / ABA # : Bank Account Number: Bank Account Registration*: * Typically the first line listed on a check / deposit slip. Example: ABC Company401(k) Plan A voided check must be attached if establishing a checking account. Please attach a savings deposit slip if creating a savings account. IX. PLAN DESIGN QUESTIONNAIRE CERTIFICATION I submit the enclosed Questionnaire as the design requirements for the Employer named on Page 1, along with the first year s annual fee of and the one time set up fee of. I understand there may be additional charges if changes are requested after the final plan documents have been produced. I certify, to the best of my knowledge, that the information provided on this Questionnaire is true and correct and the employer company named above does not currently have eligible employees. I understand if any of the data provided is later discovered to be incorrect, false, or misleading the plan may be subject to penalties and fines up to and including plan disqualification. I certify that my current or any prior plan was in full compliance, in form and in operation including timely filing of all required Annual Reporting with all applicable Department of Labor and Internal Revenue Service requirements. The plan trustees retain sole responsibility for the qualified status of that Plan. Plan Sponsor Name: Plan Sponsor Signature: Date: / / X. RECORD KEEPER CONTACT INFORMATION Regular Mail: Prime Plan Solutions Overnight Mail: Prime Plan Solutions P.O. Box W. 9 th Street Kansas City, MO Kansas City, MO Web Address: E mail: Phone: (888) Fax: (816) primeplansolutions@dstsystems.com 8 of 10

9 Exhibit A A related group can consist of a controlled group of businesses, a business under common control or an affiliated service group. The definition of controlled group can be found in Internal Revenue Code (IRC) Section 414(b). These provisions provide specific details regarding the types of controlled groups that may arise, which interests may be disregarded, a definition of effective control, etc. Also, IRC Section 318 and 1563 provide guidance on the attribution rules for Highly Compensated Employees (HCE) and when ownership of separate entities is considered to be one employer, respectively. Businesses under common control can be found in IRC Section 414 (c). In situations where there is insufficient common ownership to satisfy the controlled group requirements, an affiliated service group (ASG) may exist. The employees of each member entity are treated as if they were employed by a single employer. IRC Section 414(m) provides specific direction in addressing ASG issues. Listed below are several questions that an employer will want to consider and if appropriate, obtain legal advice in regard to related groups issues. Does the ownership interest of a single individual, or the combined ownership interests of 5 or fewer people, equal 80% or more of the equity interests in the employer? If yes, do any of such individuals have ownership interests in other businesses? Do family members (parents, grandparents, children) of any owners of the employer have ownership interests in the employer or in other businesses? Does a trust own any part of the employer? Does a foreign corporation or business entity own any interest in the business? Does the employer have an ownership interest in other businesses (e.g. stock ownership in another corporation)? Does the prospective plan sponsor provide services to another business in which the employer has an ownership interest or in which any highly compensated employee of the employer has an ownership interest? Does the employer provide or receive services to or from another business/company in which the employer has an ownership interest, or in which any highly compensated employee of the employer has an ownership interest? Does the employer provide or receive management services to/from another company? Is the proposed plan sponsor engaged in providing professional services, particularly if the professional services are provided jointly with any other business entity? Some examples are medical, legal, accounting, actuarial and engineering services. Is the employer a partnership that has any partners who are separately incorporated? 9 of 10

10 Exhibit B Date: / / Employer Name: Plan Name: As authorized individual of the above named employer ( Employer ) and on behalf of and in the name of such Employer, I have been asked, by Prime Plan Solutions ( the Provider ), to review with my attorney the above business eligibility to establish and make contributions to a qualified retirement plan under Section 401(a) of the Internal Revenue Code ( the Code ). Based on such review, the Employer hereby instructs the Provider to proceed with the establishment and administration of this qualified retirement plan. The Employer hereby accepts full responsibility, both legal and financial, should the Internal Revenue Service, the United States Department of Labor, any other United States governmental entity or authority, any financial advisor or attorney determine that the above Employer, including its successors or assigns, was not eligible to provide a qualified retirement plan on behalf of its employees, including owner employees, partners, members of a Limited Liability Corporation or Partnership because the Employer failed to include employees of any related firm. The Employer acknowledges that Provider accepts no responsibility for the determination of Employer s status regarding controlled group or affiliated service group classification, or its exemption from regulations regarding a controlled group of companies or an affiliated service group as defined by Sections 414(b), 414(c) and 414(m) (or any other related section) of the Internal Revenue Code. Employer acknowledges that such responsibility is and remains solely that of the Employer and that Provider s responsibility is limited solely to the services set forth in the agreements between Employer and the Provider. The Employer agrees to indemnify and hold harmless the Provider, its officers, partners, board members from any and all loss, damage, costs, charges, interest, penalties, liability or expenses resulting from any claim, action, demand or suit which may arise out of, be connected with, or made due by the Employer s failure to include employees of any related firm in the qualified plan or defined benefit plan or which may be incurred by a Provider to enforce this indemnification in event of a failure or undue delay by the Employer to fulfill the Employer s obligations hereunder. Employer shall, at its own expense and risk, defend or settle any such claim, demand or suit that is covered by this indemnification and brought against the Providers and the Employer shall satisfy any judgment or assessment that may be rendered against Providers in respect to any such claim, demand or suit. Name of Authorized Individual Title of Authorized Individual Signature of Authorized Individual 10 of DST Systems, Inc. The information provided herein is intended as general information and is not, and should not be considered or relied upon, as legal, tax or retirement planning advice. Neither DST Systems, its affiliates or their respective control persons have been authorized to give legal, tax or retirement planning advice. For tax and retirement planning, employers and their plan participants should consult a financial advisor. Participants should read the relevant fund prospectus before making any decisions about allocating investments in their 401(k) plan.