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Financial Resources & News

Upcoming Compliance Deadlines

February 2024 28th:  IRS Form 1099-R Copy A – Deadline to submit Form 1099-R Copy A to the IRS for participants and beneficiaries who received a distribution or a deemed distribution during the prior plan year. This deadline applies to scannable paper filings. For electronic filings, the due date is April 1, 2024, as the typical March 31 deadline falls on a weekend. March 2024 15th:...

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Reminder: Long-Term, Part-Time Employee Rules Effective January 1, 2024

As part of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act), part-time employees who worked at least 500 hours each year in 2021, 2022, and 2023 qualify as Long-Term, Part-Time (LTPT) employees. LTPT employees were eligible to make elective deferrals on January 1, 2024. What happens if you missed enrolling one of these employees? Mistakes happen. When it comes...

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401(k) Deferrals: Don’t Exceed The Limit!

Excess deferrals occur when a 401(k) participant defers a greater amount than the annual IRS limit permits. The annual deferral limit was $22,500 for 2023 and $23,000 for 2024. For participants 50 years old and older, an additional $7,500 can be deferred. When this limit is exceeded, excess deferrals and earnings need to be removed from the plan and returned to the participant. Employer matching...

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Components of Defined Contribution Plan Compliance Testing

Save More for Retirement in 2024 Plans must be tested each year to ensure that they are compliant with the laws governing retirement plans. To understand the testing performed for your plan, it may be helpful to review some of the terms that are commonly used. First, let’s examine how your plan’s noteworthy individuals are identified. Highly Compensated Employees (HCE): There are two...

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Does My Plan Need an Audit?

The main determining factor in whether your plan needs an audit performed by an independent qualified public accountant is the participant count. An audit will be required if the beginning of year participant count is more than 100. For the plan year that began in 2023, there is a change to how the participants are counted. Prior to this, the count included active participants—regardless of...

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Markets in Review

Equity markets rebounded in the fourth quarter 2023 with the S&P 500 Index1 up 11.7%, and finishing the year up 26.3%. This was a welcome performance after the steep declines experienced in 2022 as the Federal Reserve was battling high inflation. Inflation figures fell to tolerable levels during the year and the Federal Reserve paused their interest rate hiking cycle, with the potential to...

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SECURE 2.0 Provides New Retirement Savings Options in 2024

The SECURE 2.0 Act, passed in December 2022, made wide-ranging changes to U.S. tax laws related to retirement savings. While some provisions were effective in 2023, others did not take effect until 2024. Here is an overview of some important changes for this year. Matching student loan payments Employees who make student loan repayments may receive matching employer contributions to a workplace...

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Good News on Catch-Up Contributions!

Catch-up contributions are additional employee deferrals that can be made to 401(k), 403(b) and governmental 457 plans for those participants who are age 50 or older. These contributions can be made on a pre-tax or Roth (after-tax) basis. As originally laid out in the SECURE 2.0 Act of 2022, catch-up contributions for those earning over $145,000 in the prior year would need to be Roth deferrals...

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News Alert: Grace Period Extended for EFAST2 Login Credentials

If you electronically sign your Form 5500 through the ERISA Filing Acceptance System (EFAST2) and haven’t yet obtained new credentials from www.login.gov, you will need to do so by December 31, 2023. This date extends the original September 1 deadline. The new credentials established during this transition can be used across many government services. If you do not currently have login...

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Upcoming Compliance Deadlines

December 2023 1st:  Participant Notices – Annual notices due for Safe Harbor elections (note that some plans are no longer required to distribute Safe Harbor notices), Qualified Default Investment Arrangement (QDIA), and Automatic Contribution Arrangements (EACA or QACA). 29th:  ADP/ACP Corrections – Deadline for a plan to make ADP/ACP corrective distributions and/or to deposit...

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Considering Changes to Your Business? Don’t Forget About Your Plan!

In today’s changing work environment, the sale or purchase of another business is not uncommon. If you’re planning to make changes to your business structure, remember to include the retirement plan in your negotiations. The type of sale can have a major impact on your plan, so it is highly recommended that you understand which type you are considering and notify your Third Party Administrator...

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Cost of Living Adjustments for 2024

Save More for Retirement in 2024 On November 1, 2023, the IRS announced the Cost of Living Adjustments (COLAs) affecting the dollar limitations for retirement plans for 2024. In October, the Social Security Administration announced a modest benefit increase of 3.2%. Retirement plan limits also increased over the 2023 limits. COLA increases are intended to allow participant contributions and...

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Markets in Review (Q3 2023)

The first half of 2023 was shaping up to be a record-setting year but reversed course in August and September as higher interest rates and fears of a rebound in inflation weighed on the markets. Global equity markets posted negative returns during the third quarter with small caps declining the most as the Russell 2000 Index was down -5.1%. However, on a year-to-date basis, the S&P 500...

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Bonds: Is your plan covered?

The Employee Retirement Income Security Act (ERISA) requires coverage to protect the plan from losses due to fraud and dishonesty. There are three main types of bond coverage for retirement plans: fidelity bonds, fiduciary liability insurance, and cyber liability insurance. Not all three coverages are required, but understanding what is available and what they cover will help you determine the...

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It doesn’t hurt to double check! We’re here for you!

As situations arise during the plan year, it’s always better to double check the plan provisions rather than address a plan failure after the fact. In some situations, it’s easier to ask for forgiveness rather than permission, but that isn’t true in retirement plans. Correcting mistakes can be very costly. Do not hesitate to reach out to us for clarification on what the plan allows. For example:...

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