Frequently Asked Questions

From Our Year End Request Package:

Do I have to report all my employees to you?
Yes. Form 5500 and the Schedule R require you to answer questions about all your employees, not just the ones that met the eligibility requirements of your plan.

Why do I have to report the hours each employee worked to you?
IRS Discrimination testing divides employees up into three groups, those that work 1,000 or more hours in a year, those that work 500 - 999 hours in a year and those that work less than 500 hours in a year. We need their actual hours to put them in the proper group and to determine whether or not they accrue a benefit and/or vesting service.

Can I submit my employee data to you on diskette?
Yes. If this is your method of reporting to us, we prefer a Microsoft Excel spreadsheet be used. Most of our year end packages include a CD with a spreadsheet for you to use. If you did not receive one or need a replacement, please contact your administrator.

Why do you want to know if any of our stockholders also own a share of another business?
We must determine if you potentially have a controlled group of companies. IRS Regulations require that all employees of a controlled group must be tested together for discrimination purposes.

What information do you need on the Trust Financial Report and Income and Expense Summary?
The Trust Financial Report must list all the assets in your pension plan as of the first and last day of the plan year. The Income and Expense Summary must list all the income and expense items incurred during the year. The net income from the Income and Expense Summary added to the beginning of the year net assets from the Trust Financial Report must equal your end of the year Trust Financial Report net assets. We will complete these reports if you sign line B at the bottom of the Trust Financial Report. If you are not an accounting firm, we recommend that you have us complete these reports, or your CPA complete them.

When do you need the completed Pre Year End Kit returned to you?
If your plan has 401(k) deferrals, we must have the completed year end kit returned to us within 1 month after the end of the plan year, to have enough time to test your plan for excess contributions and notify you in time to refund the excess contributions prior to the penalty period (within 2 1/2 months following the end of the plan year). If excess contributions are returned after 2 1/2 months following the end of the plan year, your company will be required to pay an excise tax of 10% of the excess amount.

If you want a contribution quote, we must have the completed pre year end kit returned to us within 30 days prior to when you want the quote. Remember, to be tax deductible, an employer contribution must be made by the date you file your company return or, if you go on extension to file your company return, the due date to file your return with extensions.

Other FAQ's

Which investment companies may we use for our plan investments?
Hicks Pension Services will work with just about any investment company that will handle your plan's investments. If you would like a referral, feel free to call us.

Why doesn't Hicks Pension Services handle our plan investments?
There are two main services needed for a retirement plan to function properly. The first service is administration and ongoing consulting. The second service is investment of the plan assets. We recommend those services are kept separate so your investment company can concentrate on investing your pension plan assets and we can concentrate on keeping your plan in compliance with IRS and DOL regulations. It also gives us the opportunity to provide consulting to our clients without conflict of interest.

I work for a large company that does not have a pension plan. Can I have a pension plan as an individual?
No. All qualified pension plans must be sponsored by either a sole proprietorship (individual operating a business and filing a Schedule C), corporation, partnership, or LLP/LLC. You may want to explore your options through a traditional IRA or Roth IRA.

Hicks Pension Services is the TPA for my former company's pension plan. I believe I am due a distribution from the plan. What do I do?
Contact your former employer and make sure they sent us a Notice of Termination form for you. If not, request that they do so immediately. If so, you should be receiving notification from us regarding when your benefit is payable. As soon as it is payable, we will send you benefit election forms. If it has been several months since you left employment, your former employer verifies they sent us a Notice of Termination and you have still not heard from us, please contact us at the number below.

When can employees sign up for our plan?
Since every plan has their own set of eligibility requirements, please contact your Administrator for this information. Remember, upon reaching their entry date into the plan, each employee must be provided with a Summary Plan Description and an enrollment (EPA) form.

I need a copy of our Summary Plan Description. Where can I get one?
If we prepared your plan document, we would have provided you with a master copy of the Summary Plan Description. If you have misplaced your copy, please contact your Administrator.

Who does our enrollment meetings?
When your plan is set up for the first time, or the first year we take over your plan administration from another TPA, your Consultant will be on hand for the first enrollment meeting (along with your investment advisor). After that, we will schedule to attend enrollment meetings only upon your request.

When must 401(k) deferrals be deposited into the trust?
The Department of Labor has not been clear on this issue. The earliest possible date is the only guidance given. We have been told this has been as soon as 2 days after the payroll date for a small company (your definition of a small and large company is as good as ours, there is no guidance). The most important thing to note about this issue, however, is that if you do not deposit your 401(k) deferrals almost immediately after the date they are withheld, the plan Trustee(s) are exposed to the possibility of penalties (both civil and criminal).