401k plan set up best practice - LawsonGuru.com

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scuba80

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Posts: 35

1/29/2014 4:42 PM

I am making some significant changes to the 401k plan. To give you an idea of the current set up, there seems to be 4 different plans; Roth flat $, Roth %, pretax flat $, and pretax %. We currently use a flat dollar match and do not have a separate catch up plan. I am removing the flat $ contribution option, moving to a % match, and do not match the catch up plan. In terms of lift, what would it take to combine the roth % and pretax % into 1 plan on BN15? I do not want to match the catch up, so do I need to build a separate catch up plan?

To further complicate our set up, our 403(b) plan also has 4 different plans. Is there an easier way to administer the 401(k) and 403(b) plans in Lawson?

dtracey

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Posts: 10

1/29/2014 4:59 PM

The Roth and pretax plans can be combined on one plan on BN15. Check out KB 1208966.

scuba80

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Posts: 35

2/3/2014 5:43 PM

Thanks forthe reply, but KB 1208966 and KB 1208919 have a disclaimer:
NOTE: For clients using the Lawson Benefits module, Roth deductions must be set up on a separate benefit plan (not tied to a traditional 401(k) or 403(b) benefit plan). That was from from KB 1208919 and from KB 1208966: Benefit plan edits added so that a Roth 401(k)/403(b) deduction can not be added to a traditional 401(k)/403(b) plan on BN15. Clients using the Lawson Benefit module must set up a separate benefit plan(s) for Roth

Am I missing something. Has there been additional functionality added since these KB's were published?

Margie Gyurisin

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Posts: 538

2/3/2014 5:57 PM

Yes. Those articles can be confusing and weren't updated. You can probably find the one that has it all in one plan.

If you want the match to work and you allow employees to make both ROTH and traditional contributions, you need to have them all in one plan. There is a little trick in the setup so you get past some edits.

ruelD

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Posts: 1

3/19/2014 9:17 AM

For most of us, setting aside cash for our retirement in a 401k account is the only act of real savings. However, some are having an unexpected financial problem, which sometimes pushes them to take out loans from their 401(k) plans. Somehow it is a good idea, especially if you don't have any other option. Though, it is vital to think carefully before you take out 401k loans, as it may result to defaults. More information here: 401(k) loan defaults.

brunot

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Posts: 9

4/18/2014 6:59 PM

Were you able to get this set up in 1 plan? I am currently trying to do the same thing with our 403b plan.

Thanks!

scuba80

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Posts: 35

5/6/2014 1:50 PM

We were able to set up a pre-tax plan and a roth plan as 1 on bn15. Send me a message if you still need information.

Sarah

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Posts: 33

5/6/2014 3:09 PM

We set up our roth 403b deductions and pretax 403b deductions into 1 plan on bn15 with three different deduction codes. We had to remove the tax status on pr05, save it blank and then add the dedcd on bn15. We had to go back to pr05 and put the right tax code 17 in after it was already attached on bn15. I can't remember if we were allowed to keep it blank on pr05 or had to make it 06 or something else. Email me at sarah.cotton@nortonhealthcare.org and I'll dig through my documentation. It's been awhile and we had to test it like crazy to make sure it was maxing out correctly for folks at the correct max depending on if they were over 50 or not.