Enmgy E-00065-15-o Series2 Ethics - 1 Cpe Hour For Score Of At Least 70%

10 Questions | Total Attempts: 41

SettingsSettingsSettings
Enmgy E-00065-15-o Series2 Ethics - 1 Cpe Hour For Score Of At Least 70% - Quiz

MAR/APR 2015 - SERIES 2 2015ETHICS & PROFESSIONALISMPlease indicate whether each of the following statements is TRUE or FALSE


Questions and Answers
  • 1. 
    If a participant loan reached its 5-year maturity date on August 15, 2014 but there is still an outstanding balance at this time, EPCRS permits a current correction of the defaulted loan by a reduced cost submission under VCP.
    • A. 

      True

    • B. 

      False

  • 2. 
    EPCRS permits the delayed correction of defaulted loans through the self-correction program, but the employer’s plan must have 13 or fewer participants with loan failures for the self-correction option to be viable.
    • A. 

      True

    • B. 

      False

  • 3. 
    The IRS has adjusted the filing fee for a VCP submission of a plan’s failure to make required minimum distributions and, besides the low filing fee, the biggest advantage of a formal VCP submission is that the IRS has the authority to waive the 50% excise tax for the participant(s).
    • A. 

      True

    • B. 

      False

  • 4. 
    For employers with automatic enrollment plans, the recent updates to EPCRS provide relief from the employer needing to make a QNEC to cover any missed deferral opportunity, for up to 9-1/2 months after the end of the plan year in which there was a failure to implement automatic deferrals, automatic increases, or participant overrides to the default deferral percentage.  
    • A. 

      True

    • B. 

      False

  • 5. 
    For employers with 401(k) plans that still require affirmative elections (non-automatic enrollment plans), the recent updates to EPCRS provide relief from the employer needing to make a QNEC to cover certain missed deferral opportunities, for up to 3 months after the missed deferrals occurred due to an employee being improperly excluded from the plan (by the employer). 
    • A. 

      True

    • B. 

      False

  • 6. 
    Even though the recent updates to EPCRS may provide certain employers with a free pass on the employer needing to make a QNEC to cover any missed deferral opportunity, in plans with matching contributions, the employer will still be required to make a QNEC to make-up for the matching contribution amount that the plan participant would have received but for the employer’s failure to timely process the salary deferrals through payroll or to timely handle the employee’s enrollment. 
    • A. 

      True

    • B. 

      False

  • 7. 
    For employers with 401(k) plans that still require affirmative elections (non-automatic enrollment plans), the recent updates to EPCRS provide for a reduction from 50% down to 25%, when it becomes necessary for an employer to make a QNEC to cover certain missed deferral opportunities that exceed the new 3-month rule but are still within the 2-year self-correction period, when missed deferrals occurred due to an employee being improperly excluded from the plan (by the employer). 
    • A. 

      True

    • B. 

      False

  • 8. 
    Before determining the amount of the missed deferral opportunity based on the 25% multiplier, the actual missed deferral must be determined based on longstanding rules under EPCRS, for example, if the 401(k) Plan is a Safe Harbor 401(k) with a 3% nonelective contribution, the guidelines indicate that the missed deferral amount is equal to 3% of compensation.
    • A. 

      True

    • B. 

      False

  • 9. 
    In a non-automatic enrollment Safe Harbor 401(k) Plan that is relying on the Basic Match formula to satisfy the ADP Safe Harbor, there was a missed deferral opportunity discovered 6 months after the plan year end and, pursuant to EPCRS and the recent IRS updates, the missed deferral amount is equal to 5% of compensation, and the employer’s QNEC to cover the missed deferral opportunity (during the 2-year self-correction period) would be equal to 1.25% of the participant’s compensation.
    • A. 

      True

    • B. 

      False

  • 10. 
    For employers with automatic enrollment plans, the recent updates to EPCRS provide relief from the employer needing to make a QNEC to cover any missed deferral opportunity, for up to 120 days following the month in which a participant advises the employer of a failure to implement automatic deferrals, automatic increases, or participant overrides to the default deferral percentage.  
    • A. 

      True

    • B. 

      False

Back to Top Back to top