Articles — Ascensus

Coverdell ESA Pros and Cons

What are some benefits of an ESA compared to other types of accounts? What are some of the pitfalls? Can a customer open an IRA for his child to pay the child’s education expenses?

ESA, expertAscensusMarch 15, 2018Compliance & Operations, Coverdell ESA, Education, Distribution, Q&A

Be Ready to Answer These Thorny HSA Distribution Questions

HSA savings is on the rise, and customer questions will not slow down. Being able to answer to confusing HSA questions will set you apart as an HSA expert and a provider of good customer service.

HSAAscensusMarch 15, 2018Compliance & Operations, HSA, Distribution, Reporting

Retirement Plan Beneficiary Designations

Can a participant name someone other than her spouse as the designated beneficiary for her qualified retirement plan? If a participant has a last will and testament, should the plan administrator distribute plan assets to the person named on the beneficiary designation or to the person named in the last will and testament?

IRS Announces When to Expect DB Plan Opinion and Advisory Letters

The IRS released an announcement in March that describes when it expects to begin issuing opinion and advisory letters for defined benefit (DB) pension plans.

Employer PlanAscensusMarch 15, 2018Retirement Plan, IRS, Documents & Amendments, Guidance & Legislation

IRS Says 2017 Hurricane Distributions Should Be Reported on Form 1099-R as Penalty Tax Exception

The IRS announced a late change for 2017 Form 1099-R reporting of IRA and retirement plan qualified hurricane distributions. The IRS is not, however, requiring reporting corrections.

Employer Plan, IRAAscensusFebruary 15, 2018News, Retirement Plan, IRA, Disaster, Form 1099-R, Reporting

Who is a retirement plan fiduciary?

What does it mean to be a fiduciary of a plan? Who are fiduciaries of the plan? Must a fiduciary tell participants that he is a fiduciary?

expert, Employer PlanAscensusFebruary 15, 2018Compliance & Operations, Retirement Plan, Fiduciary

Tips to Help You Avoid IRA Compliance Blunders

IRA compliance is a big responsibility for financial organizations that administer IRAs, and mistakes do happen. Here are common errors that Ascensus® consultants have found during financial organization IRA compliance reviews.

IRAAscensusFebruary 15, 2018IRA, Compliance & Operations, Reporting, Documents & Amendments, Withholding, Beneficiary

HSAs: Prorating Contributions

How is an individual’s HSA contribution limit determined for the year he enrolls in Medicare? How much can an HSA owner contribute if he switches from self-only to family health insurance coverage mid-year?

expert, HSAAscensusFebruary 15, 2018HSA, Contribution, Q&A

IRA Recharacterizations Past, Present, and After Tax Reform

Tax reform legislation no longer allows taxpayers to undo their IRA conversions and retirement plan rollovers to Roth IRAs, which both have potential for heavy tax hits. Here’s a look at recharacterizations during this 2018 transition year.

IRA, Employer PlanAscensusFebruary 15, 2018Roth IRA, Retirement Plan, Recharacterization, Conversion, Rollover

2018 Roadmap—Be on the Lookout for These Retirement-Related Changes

The start of a new year is the ideal time to create a roadmap for the year ahead, noting retirement plan changes that may be on the horizon. Here are key items to keep watch for in 2018.

Employer PlanAscensusFebruary 15, 2018Retirement Plan, Guidance & Legislation, Regulations, Fiduciary, Tax

Get Ready for 2018 Contributions, but Don’t Forget 2017 Prior-Year Contributions

Traffic at financial organizations picks up soon for IRA and health savings account (HSA) contributions. Individuals can start making 2018 contributions, but preparing their 2017 income tax returns often prompt them to make prior-year contributions.

IRA, HSAAscensusJanuary 18, 2018Traditional IRA, Roth IRA, HSA, Contribution, Eligibility, Deduction, Compliance & Operations

How the New DOL Fiduciary Rule Applies to IRAs and HSAs

The financial industry has been hearing about the Department of Labor fiduciary (conflict-of-interest) rule for several years. These rules apply to IRAs, HSAs, and Coverdell ESAs, as well as employer-sponsored retirement plans. While some aspects will not apply until mid-2019, financial organizations should fully evaluate how the rules affect their products and services.

Capture Larger Share of Rollover Market From Beneficiary Rollovers

Accepting rollovers of inherited retirement plan assets is a great way to grow IRA business. Financial organizations interested in capturing a larger share of the rollover market should encourage rollover contributions from employer-sponsored retirement plan beneficiaries.

IRAs: Reporting Oddities

An IRA owner wants to complete a rollover through the new self-certification process. How do we report this? Must we file a corrected Form 1099-R showing a small incorrect amount? Can an IRA beneficiary do a qualified charitable distribution?

IRA, expertAscensusJanuary 18, 2018IRA, Reporting, Beneficiary, Distribution, Form 1099-R, Tax, Compliance & Operations, Withholding, Form 5498, Q&A

Key Coverdell ESA Contribution Questions Administrators Face

Coverdell education savings accounts (ESAs) provide a unique savings vehicle with the potential to have tax-free income to cover the costs for education. Questions about ESAs surface when family members, or others, come into their financial organization to make contributions for their loved one. Here are a few common questions financial organization may encounter about ESA contributions.

ESAAscensusJanuary 18, 2018Coverdell ESA, Contribution, Tax, Compliance & Operations

Tax Reform Law Affects IRAs, Retirement Plans, and Other Savings Arrangements

Late in December 2017, President Trump signed tax reform legislation into law (Public Law No. 115-97) resulting in fulfillment of one of the GOP’s major 2016 campaign promises. The legislation affects employer-sponsored retirement plans and IRAs, and in some cases, other tax-advantaged savings arrangements.

Employer Plan, IRA, ESAAscensusJanuary 18, 2018News, Compliance & Operations, Congress, Tax, Retirement Plan, IRA, Guidance & Legislation

IRS Issues Reminder About Retirement Effects of Hurricane Relief Legislation

The IRS released a reminder notice in December 2017 of the tax-related relief granted by the Disaster Tax Relief and Airport and Airway Extension Act of 2017. This legislation, enacted in early October 2017, provides special options for those affected by Hurricanes Harvey, Irma, and Maria, including options specific to IRA and employer-sponsored retirement plan assets.

Retirement Plans: Qualified Domestic Relations Orders

What is the difference between a domestic relations order (DRO) and a qualified domestic relations order (QDRO)? How can the alternate payee take the awarded amount from the plan? How will the award be taxed and reported?