Sal Tripodi: COVID Plan Issues, Savers Act & Fee Ethics | Retireholics

[0:00] JD: No, you're intimidating him. [0:02] Sal Tripodi: I don't really. [0:04] Chad: That's the point. [0:05] Sal Tripodi: No idea how nerve wracking this is for your guests. [0:08] Chad: Yeah, right. [0:10] JD: I was proud of. I hopped on Tom Clark's little Q and A last week on Friday morning. And I thought it was cool of him, humble of him to just take random questions. And a couple of them, he's just like, you know what? I don't fucking know the answer to that one. [0:29] Chad: Yeah. [0:30] JD: And I was like, yeah, good for you, man. [0:34] Chad: Some of them I listened in two weeks ago, I think it was. And some of the questions are so far out in left field, I could see him spinning. Like, do I really spend time answering this or just move on to the next one? [0:47] JD: He does a good job. [0:50] Sal Tripodi: I did live on YouTube. [0:52] Chad: So this is being recorded now. [0:54] JD: Okay, Quince, I wasn't even thinking about that. But we're gonna have him on Thursday, so he's coming. Tom Clark's gonna be our guest on Thursday. And then next Tuesday we've got the Rishi boy. Rishi's coming. [1:12] Chad: That ought to get ugly. [1:14] JD: And Reese Fred Reich is on. Mark reminded me this or Justin did is on Cinco de Mayo, motherfuckers. [1:25] Chad: Fitting. [1:26] Sal Tripodi: Fitting. [1:26] Chad: With his Dos Equis. [1:30] JD: I'm sending him a six pack of Dos Equis Amber to his door for the show. [1:36] Sal Tripodi: So the people that want to attend that. You have people that are attending this today, right? How do you to just do that? Where's your link for that? [1:48] JD: It's all over the Internet, bro. It's on that thing where you. Where you didn't like your hair. [1:53] Sal Tripodi: Okay. [1:54] JD: It's right there. [1:56] Chad: It's a zoom meeting. Anybody just has to type in the zoom meeting number, okay? Zoom website, and it'll pop up. [2:03] JD: Sal. We call it the Internet. [2:06] Sal Tripodi: Oh, fuck you. Kevin Reynolds says hi. Sales. Oh, Kevin's on. Oh, my. Okay. [2:17] JD: You just heard your potty mouth. [2:19] Chad: Kevin. Kevin must really like you because he doesn't say hi to any of us. He just wanted to. [2:24] Sal Tripodi: It's his wife that likes me even more. Yeah. [2:30] JD: We gotta get here. [2:31] Mark: Hey, Jake, it's for you, man. [2:35] Chad: Oh, look at that. Mark's rapping. [2:37] JD: Oh, wrapping the. [2:40] Mark: It needs to go on here, though. [2:44] Chad: Look at you repping and working, Mark. [2:47] JD: All right, I think we're pretty close to 4:30 Brannon. You got a little video to kick us off? [2:56] Chad: No, Sorry. [3:02] Sal Tripodi: I had to watch Ozarks last night. [3:04] Chad: Things to do. [3:05] Sal Tripodi: Oh, I've been holding off on that. Is it good? The light of season. [3:09] JD: Yeah. [3:10] Chad: Yeah, you know, I'm preferring it, honestly. [3:13] Sal Tripodi: I think like they're diving a little [3:15] Chad: more into the money laundering, which I like. [3:19] Sal Tripodi: Okay, [3:22] Mark: why do you, why do you like that, Brandon? [3:24] Sal Tripodi: I like the technical aspect. It's fun. [3:29] JD: Dance, Chad, dance. Dancer. [3:31] Chad: I am. My legs are moving. I'm too sore from working out though. My body's in pain. Okay, are we there? [3:41] Sal Tripodi: Yeah. [3:41] Mark: It's 4:31. [3:48] Sal Tripodi: Welcome everybody to retire. [3:51] JD: Hey, what's up everybody? What's going on? Bradley? Chris McDavid, Jake Rushton, Dizzle. [4:01] Sal Tripodi: Join Kevin. [4:02] JD: Michael. Michael. Michelle Curry, Mike Rogers. The list goes on and on. Thanks you guys for attending. We appreciate you being here. [4:11] Sal Tripodi: We have got pch. [4:14] JD: PCH is here. We are. We are super excited for our guests today. You're talking about a four former president of aspa, the author of the eob, the ERISA Outline book, a nationally recognized lecturer and educator, probably one of the top minds on ERISA technicalities. Frickin. Sal Tripote. What's going on, Sal? [4:48] Sal Tripodi: Oh, things are good. How are you guys? [4:51] JD: We're good, we're good. After all of those really like high end roles and responsibilities, what brings you back on retireholics for the second time in your career? [5:03] Sal Tripodi: Just because I had so much fun in Hawaii and I thought it would be great. [5:07] JD: We did have a good time. We did have a good time. Well, you're used to it. [5:11] Sal Tripodi: You begged a lot in the email. [5:14] JD: Yeah, I did. I was begging. I was begging. [5:19] Chad: That doesn't surprise us. [5:21] JD: If you're tuned in right now, check us out. On Thursday we will have ERISA attorney Thomas Clark. And then next Tuesday we've got Fred Reich on Cinco de Mayo. So check us out for that. Sal, you have played these games before with us, so we're going to kick it. Go back to the old school game that we call prohibitive word. And if you say that word, you must drink from your nasty drink. Everybody show the audience what you got going on for your nasty drink. And if you're tuning in, if you could help us out and police it, feel free to do that in the chat box. [5:57] Mark: J.D. [5:58] JD: justin. Yes, sir. [6:00] Chad: I happened to catch a few minutes of Sal's prior episode today because I remembered something that he made fun of us for and he said that it's not a retirement show, it's a drinking game show because of how many cocktails Sal had to drink on our last show together. Say we try to push that limit for him today. [6:18] JD: Well, we are drinking beer and then drinking a penalty drink. Sal's just Sipping on his penalty drink the entire show is my understanding. So there he is, like a true gentleman. We was gonna say if you have please chat, ask questions. Justin will be looking at those and chiming in with some of your questions. You got an ERISA expert here and I'm not talking about Chad. So he's hit us with those questions. [6:46] Mark: Thank goodness. [6:47] JD: Let's dive right into it. 401k specialist put out an article on this Savers act and I read it there, I read it on aspa's site to kind of get my brain wrapped around it a little bit. It's apparently the ability to triple up on your deferrals at this point. Am I getting that right? [7:13] Sal Tripodi: Well, it's triple up on deferrals and then it's triple up on the 415 limit too. [7:18] JD: And so I don't think we have a lot of details on it. But let's chat a little bit. Sal, is this a good thing? Is this a helpful thing? Is this a well timed thing? Like what's your thoughts on the Savers Act? [7:32] Sal Tripodi: Well, I can understand the motivation for doing something like this. I mean it's really just an attempt to give individuals that are in a financial position to do so to restore some of the losses in their accounts. But I just don't see it going anywhere. In Congress. You've got the issue of discrimination, testing and the group of employees that are really going to be able to do this. Are we towards the higher end, compensation wise? I just don't really see it realistically being legislation. [8:07] JD: Nancy's probably not going to be a fan of it. I think it's interesting that we come up with all this legislation. Yes, Mark, [8:15] Mark: Either I was once again caught not paying attention or. What was the word? [8:24] JD: Oh, thank you. The word is plan. My bad. Thanks, Mark. [8:28] Sal Tripodi: Did I say plan? [8:30] Mark: Yeah, you did. [8:31] Chad: Way to go, Sal. [8:33] JD: I don't know, can I say I [8:36] Chad: kind of feel like it's in bad taste, the timing of the Savers Act. People are being laid off, they can't afford to keep employees, workers are unemployed, unemployment claims are at a high and we're going to go after the people who are still employed and still making a decent amount of money and say let's triple what you can save this year. I feel like it doesn't, it doesn't come off my tongue feeling very clean [8:59] JD: when I say it seems so weird we had all this legislation to help people get their hands on money because we're in the middle of this worldwide pandemic but now all of a sudden we also need something to help people save more money. Like I'm baffled. [9:16] Sal Tripodi: I don't think it really has anything to do with saving more money. I think it's just trying to use your own money to make up for your investment losses. [9:24] Chad: I could see and I could see if they wanted to come out and sell say almost like an after tax or Roth component to it so they can try to claw back some dollars and tax dollars saying that if you're going to exceed the 19:5, the remaining dollars need to be in a Roth component. I could see that creating some benefit for the government, maybe having some positives on both sides, but that's not what was written in there. [9:48] Sal Tripodi: Right. [9:48] Chad: It's just a straight tripling from my understanding. [9:50] JD: And then Sal brought it up. What about ADP tests? Like how's that kind of. [9:56] Sal Tripodi: Well, he's. Yeah, I mean see he's not, he's not providing any special rules regarding the discrimination testing. So the only thing I could see it possibly, I mean what's going to end up happening is if they pass something like that is all those safe harbor plans, all of the highly compensated would do three times the deferral limit knowing that they don't have a test. And that would be about all that happened from it. I don't, I see more than that coming. [10:23] Chad: And I will say two kind of byproducts might be for some highly comps, depending on how they're paid, they're highly comp from income based in 2019. They may be in a lower tax bracket this year in terms of tripling their deferrals because if they're commission based folks, they're making less in 2020. [10:42] Sal Tripodi: Well, this law, the law does allow you to use your 2019 comp as if it were your 2020 comp. [10:51] Chad: Whoa. [10:52] Sal Tripodi: Yeah. [10:53] Chad: Allows you to though. So you're not forced to. [10:55] Sal Tripodi: You're not forced. But I mean so you could. Because they, even though they're tripling the limits, you still have to have enough compensation to cover it. So of course you want to use your last year's comp so you can make triple the contribution. That's okay. [11:11] Speaker E: So even solo case can essentially do the same thing. Like. So you're talking about increasing the 415 limit. [11:17] Mark: Right. [11:17] Speaker E: That's going to allow somebody to do $200,000. But what about the compensation? [11:28] Sal Tripodi: But three times the 415 limit is 171,000. I actually calculated that. So. [11:34] Chad: Of course you did. [11:36] Sal Tripodi: So that's still under the compensation limit. So that's okay. That works. But you still, again, you have to pass discrimination testing. It's really more of a boon for safe harbor 401 and new comparability plans. [11:48] JD: And rich people. [11:50] Sal Tripodi: And rich people benefited by the Safe Harbor 401K. [11:55] JD: But let's be clear. It's. It's only. It's only just a bill. Right? You remember that cartoon? [12:02] Chad: I'm just a bill. [12:04] JD: I became a bill, and I'll remain [12:06] Sal Tripodi: a bill until they decide to make [12:08] JD: me a law [12:11] Chad: sitting on Capitol Hill. [12:13] JD: Nice, Chad. [12:14] Chad: That had an impact on my childhood [12:16] JD: because I had a lot of advisors reaching out, asking about it. And so let's be clear, it's just a bill right now. It's not actual letters. It's not actual law. [12:23] Sal Tripodi: Plus, it would have to come out of the house. It's not going to come out of the house. [12:26] JD: Right. Fair enough. They got a lot of stuff to work on anyways. Let's shift gears. We want to ask you a personal question. And I don't mean personal in our own lives, but as a tpa, we've run into some problems in the past and, and we've struggled with how to deal with it. And so we wanted to get your insights. The boys here are such great salesmen. They're out there running and gunning and bringing in a plan hand over fist. And sometimes they bring in a plan, the client comes in, they go through our design call. You know, we set them up with eligibility and a match or whatever. They sign the adoption agreement and all the places they need to sign it, and then life goes on. I turn around and four or five months later, the client's reaching out because they're not paying their bills. And they're saying, hey, we decided that we're kicking out of this thing. We didn't want to do it. You know, we've gotten cold feet, whatever, but, you know, we haven't done it. And we've always struggled with this concept of like, well, wait a second, they've got a signed legal document. Can they just pretend like that never happened? What do the Sal Tripotes of the world say to them? [13:42] Sal Tripodi: So the issue is not that they won't pay you. The issue is, can they just pretend it doesn't exist? Yeah. [13:48] JD: Take the paying part aside. Who cares about that? Can they pretend like it never happened? [13:53] Sal Tripodi: Well, it depends on who they've told about it. I mean, I mean, I would never give official advice to somebody to. You know, I try to put myself in their position. But if there has been no reporting of the plan and no communication of the plan, arguably the plan can be deemed to not exist. [14:16] JD: You mean no participant notice. [14:19] Sal Tripodi: Right. [14:20] JD: And no. And no 5500. [14:22] Chad: Right. [14:23] JD: No money's hit the account. [14:25] Sal Tripodi: Part of having a qualified plan according to IRS is that it be communicated as well to participate participants. And you know, yes, they have signed something, but if they wanted to sort of do a. You know, one of the things we used to do back in the day was if somebody wanted to not have their plan anymore, we would create a plan, an amendment to the plan that would cause it to be disqualified. [14:52] JD: Keep talking about you owe us a couple drinks. [14:55] Sal Tripodi: Oh, did I say plan? Several times. Okay, wait, four times. [15:00] Chad: That was four. [15:04] JD: Keep your eye on that chat bar, Justin, if you see any good stuff. [15:08] Sal Tripodi: Now what we used to do back in the day is to have [15:13] Mark: an [15:14] Sal Tripodi: employer adopt disqualifying amendments to the plan because most documents governing these things do provide that in order to have it be qualified if the plan ultimately is disqualified. I'm getting purple tunnel syndrome over here that the plan is deemed not to exist. [15:42] JD: I like what you're saying. [15:44] Sal Tripodi: That was what asked me about that. And have plan as the, as the word. [15:49] JD: Yeah, you've, you're pretty shitty at this game. [15:54] Sal Tripodi: At this game. [15:55] JD: But I hear what you said [15:57] Chad: all over. The issue that we tend to run into is that we'll, we'll get a client excited about, about setting up a new retirement vehicle. That they see the value, they see the tax efficiencies, they go ahead and establish. And then a short time after that, business gets in the way. They never made a contribution. January hits, they come back like, well, we never, we never funded it, therefore we don't have a plan. Dang, that was one. And so we're now in that spot of advising them. You should file a 5500. You should close down the program to show that it no longer exists. You have a final filing outside of that, which that's kind of been the guidance. And some of them, quite honestly, they put up the middle finger and they're like, yeah, I don't care. And so we're sitting there as a business just spending hours, time, capital, resources, energy and money. And the clients are taking this like it's not serious. And we're trying to combat internally how to handle that both legally and professionally. [17:03] Sal Tripodi: Well, I think your advice to. I'm assuming that the vehicle is typically a profit sharing vehicle, usually a 401k. [17:15] Chad: Even if I'm getting even dirtier. It's a 401k safe harbor match. That tends to be the one that pulls out of this. [17:21] JD: Well, Sal's going to tell you, if they sent out the damn safe harbor notice, then they're screwed, right? [17:26] Sal Tripodi: Well, I think certainly if they sent out the safe harbor notice, which if they have a match in there, they would have had to do that, and there is that. It's a contractual arrangement with the employees. They can certainly give them notice to turn around and discontinue any further maintenance of the vehicle. But if they had already communicated. Are you saying that they had never actually implemented any deferrals by the. Never done. That they have none of that accumulated. I think your advice to actually the approach to formally terminate the vehicle and then file A Form 5500 is probably the best thing that you can tell them. Whether they accept that advice from you or not isn't. Is a separate question. They don't have to do what you're suggesting to them. [18:18] Chad: Do you think in all your years of experience that's a common practice when that happens, or do you think other TPAs let it go, tuck the tail, delete the documents and say, all right, what can we do? [18:30] Sal Tripodi: My guess is that if there are no assets that have been contributed that I would say, I don't know if I can say most, or at least I would say at least more than few, have probably chosen not to do anything, not to report, not to get on the reporting cycle with the government. And that's, you know, there's some merit in that. Again, what I mentioned earlier, I think if you're going to take that approach and not file anything for the vehicle, I would have the employer adopt amendments that would not be qualified. So that the plan arguably is not a qualified plan. That would have to be file one too. [19:16] Chad: Don't. [19:16] Sal Tripodi: I think that might be a. So. But. But go. If you're not going to formally do that, if you're going to formally file the 5500, then just go through the mechanics and adopt termination and go forward, [19:27] Chad: which is usually what we do in that scenario. And our response back to a client is to simply say, look, we're trying to keep you safe. That's what you initially hired us for, is to create this plan, allow for this tax efficiency and keep you out of harm's way. You're putting yourself in harm's way by doing this. And sometimes they just. They go back to that. [19:47] Sal Tripodi: Have the employers been willing to do that? [19:52] JD: Yeah, it's a Mixed up. [19:53] Chad: Oh, my gosh. That is horrible. [19:56] Mark: Jeez, it looks hilarious that you're drinking that out of the bottle, too. [20:00] Chad: Dude, I found the worst thing I could find in my liquor cabinet. There it is. [20:06] JD: Sylvia from the audience said, make communications part of your package. So you send it out with the notice of the plan. And to answer Sylvia, I get that. That's interesting, but I'm not trying to force them to keep the plan. I'm just trying to deal with. I'm just trying to deal. [20:22] Chad: That's too JD on it. [20:26] JD: I'm just trying to deal with a proper way to get them what they want, which is get it out of there. And so basically, Sal told us we could do it either way. He gave us both answers, but. [20:35] Chad: And we always have the advisor breathing down our necks, right? They're trying to do what makes their client happy. And they don't understand, necessarily the legality side of things. So, like, come on, let's. They never funded it. It didn't exist. [20:47] Sal Tripodi: And if it's already communicated, I certainly wouldn't want to put them in a position where you now have already sent communication or recommended that, because I think you close off your options, you narrow your options. [21:01] JD: Before we tackle some more 401k stuff, let's have a little fun. We like to play a game on here. What do we call the game? Mark? [21:11] Mark: Who dat? [21:13] JD: Who dat? And so we're gonna play you today, just a pure audio clip, okay? And then you have to guess the movie that we're playing for you and save your guest till the end of the clip. [21:26] Sal Tripodi: All right? [21:29] JD: You're gonna beat me and golf. Oh, you're on. [21:36] Sal Tripodi: You're in big trouble, though, pal. [21:37] JD: I eat pieces of like you for breakfast. [21:39] Sal Tripodi: You eat pieces of for breakfast? No, no, [21:50] Mark: No. [21:51] JD: What was the guess? That's pretty bad. That's Happy Gilmore, bro. That's Happy Gilmore. [21:58] Chad: Oh, yeah. As soon as the ue pieces of for breakfast, man. [22:02] JD: That's a good audience. Okay. That's okay. We're gonna give you. [22:05] Sal Tripodi: Thought it was Kanye west, but never mind. [22:07] JD: We're gonna give you. We're gonna give you more chances. We'll give you another one. See if you can redeem yourself. [22:12] Sal Tripodi: Short one. It's very short, so I'm sorry, Dave. I'm afraid I can't do that. Okay. 2001. [22:24] JD: Oh, I knew he'd get the boomer one. I knew he'd get the boomer one. All right, one more. One more. Did you eat a lot of paint chips when you were A kid? [22:40] Sal Tripodi: Why? [22:42] Chad: Ooh. [22:44] Sal Tripodi: All right, a little more help. [22:45] JD: We'll give you a little more help. [22:50] Mark: Oh, I can actually hear you getting fatter. [22:54] Chad: Got it. [22:55] Sal Tripodi: I know these, but I don't know, I'm stumped. [22:59] JD: I actually don't know the title. It's Chris Farley. [23:02] Mark: What's the Tommy Boy? [23:04] JD: Yeah, yeah, yeah, Tommy Boy. [23:08] Sal Tripodi: I'm sorry. [23:08] JD: Say 1 and 3 next time. We'll just give you all old movies so you get them. Let's move on. Let's move on. Good try. Good try, Sal. Good try. [23:19] Sal Tripodi: You guys are mean, [23:23] Chad: yet you came back. One last torture session. [23:28] JD: We've talked about this a little bit, but we haven't really dove deep into it. I'm starting to get more and more requests from advisors and their plan sponsors about, about shifting their fees from like hard dollar fees that they pay us as tpa and they want to shift it to an asset based fee because they're struggling, right? Their businesses are hurting. They're trying to look at all their overhead and they say, they come to us and say, hey, we're paying you three grand a year. Can we stop doing that and shift it to the assets the same way we pay our record keeper, the same way we pay our advisor? How do you feel about that, given that the optics are the one reason you're doing it is because your business is struggling. What does Sal Tripote think about that? [24:19] Sal Tripodi: I'm not crazy about that because I think what you guys do is you provide services that really, the value of your services don't really correspond to the value of the plan assets. So it doesn't to me, I think as a plan, I think as a. [24:40] Speaker E: I think you broke the last show record. [24:42] JD: Yeah, I think you're breaking all records. [24:44] Sal Tripodi: Hold on, hold on. [24:47] JD: Well, let's also assume, let's assume that you could cap it at 3k. So let's assume that it doesn't grow with assets, but you're just going to take it now from the participants as opposed to writing a check for them. [24:58] Chad: It. [24:58] JD: Still feeling bad about it. Right? [25:03] Sal Tripodi: Well, how do you feel about that though? If you're going to be subject to a cap, it'll be lower based on the value of fees. Does that make sense to you? [25:15] JD: Here's my. First of all, if you were a new client and you came to me and you want to have your fees asset based, I have no problem with that. And we do that from time to time. So if you make that cognizant decision, you understand it, you're aware of it. We will do that. Whether that's just pure basis points or whether that's setting a flat dollar amount to be taken from the assets, we will totally do that if you want to. My issue with this right now is the motivation for you doing it is that you're struggling financially. And I feel like that. That puts a different kind of filter on it. It's like you're saying to your employees, hey, we're in tough times, we're struggling, so we're going to push this fee to you. [25:59] Mark: And so are the employees. [26:01] Chad: And extrapolated out. That's what I was just going to say, Mark. Extrapolated out where? Now you're saying if the business is struggling, the employees are likely struggling. And if the employees are likely struggling, we know the market is down. Now you're saying not only is the market down, but we're going to throw on some extra costs that you are not used to paying. Like the whole flow of it is tough in this current time. [26:26] Sal Tripodi: So is this really more about pushing the. Because a flat fee can be pushed to the plan. [26:31] Chad: That's what we're saying is that they're. Oh, yeah, another one. They're pushing all costs to a basis point just so that the business doesn't have to write a check for those fees. [26:41] Mark: Right. [26:42] Sal Tripodi: So that's fine. But they could do that. They could do that with a fixed fee that gets allocated to a career. [26:49] JD: Sure. I don't care about that. I'm just asking more about making the purchase. [26:54] Sal Tripodi: You're asking more about having the plan pay where the employer used to be paying. [26:57] Chad: Yeah, yeah. [27:00] Mark: Would you have a different. [27:01] Sal Tripodi: Can I ask for a new word? [27:05] Chad: I was going to say we should move on to participants or something. Make it equally as hard. [27:11] JD: Sorry, Justin. You're saying. [27:13] Chad: Yeah. [27:13] Speaker E: Would you have a different feel towards it? Meaning, you know, basing it off of plants I were actually part of. [27:18] Chad: Yeah. [27:18] Speaker E: Plant size and participant size. [27:19] JD: That's two for you, buddy. [27:23] Sal Tripodi: No, I think this is. Now that you guys have talked more about it, I see that the real issue is the employer. Doesn't matter how it's calculated. The issue is whether the employer wants to keep paying out of pocket versus and that's a reasonable decision for an employer to make anytime. There's no requirement for an employer to pay the expenses outside of the vehicle. So they can certainly pass that on. And remember that these accounts are really. They're not directly affecting employees till it's time to actually get paid. And if the employer frankly needs the financial assistance so the plan can stay viable to pass on through the vehicle's account balances. That's reasonable. I think the employer has the right to do that. In some cases should do that. So if it's necessary to be able [28:22] Mark: to continue to the right to do it, yes. Can't argue that. But we talked about earlier the Savers act being a bad look, right. Essentially saying it's benefiting those who can probably take the hit more so than the others can right now. Especially right now. So you're telling me that, oh, hey, employees, we're gonna cut your pay by 40%, and by the way, you're having other issues and your expenses don't change, but we're gonna charge you more just to save money, your retirement, which is. [29:02] Sal Tripodi: Hey, I certainly would feel differently about it. [29:05] Mark: But what I was going to say [29:06] Sal Tripodi: is, but if employee. [29:07] JD: If the. [29:08] Sal Tripodi: If the employer is trying to take. Make some adjustments so it can keep the plan going, keep paying their employees. But part of that means shifting the burden of expenses more to the balances, I think that's a reasonable thing to do. [29:24] Mark: Okay, fine. [29:25] JD: That's the debate. [29:27] Mark: I think I'm okay with that. As long as if the business owners are the one making that decision, fine. Take it out of your account. It's not coming. You're not cutting a check for it. Take it out of your balance. [29:38] Chad: Oh, geez, look at you go, Mark. [29:42] JD: Higher than the people that are putting [29:45] Sal Tripodi: out of that person's account, though their account is probably this one. [29:49] Chad: Could be the majority of the assets. [29:50] JD: Yeah, it depends. [29:51] Mark: As long as that's the case, I get it. Maybe I'm okay with it. [29:56] Sal Tripodi: No, it's just. And also, keep in mind, yes, you are taking it out of accounts, but that is different than asking employees to actually, they're not writing a check to pay for these expenses. It is coming out of their account. And maybe over time, you know, they'll be back to our situation where they can. This is so weird because this is so different than my politics. I can't believe it. [30:19] Mark: Chad, one second. The only thing that I worry about in the grand scheme, the bigger picture, is that they do that and make that change. Now, whether you agree with it or not, whether it's right or wrong, and then they don't change it in the future, if they're willing to make sure that, okay, when the dust settles, and hopefully you go back to business as usual, that your cost to your vehicle does. Goes back to what it was as well. But in my mind, Right. It's Just like anything else we do, once you set it, kind of forget about it unless you're okay, I'll throw it back to our advisor community. Hopefully they're a part of this process and they can come back and sit with them during the review process and go, hey, remember how we adjusted that because you were having some financial troubles? That is over. We're in a good place. Now. Let's get back to you cutting this check because of the tax efficiency and also your participants don't need the burden of this cost. [31:20] Sal Tripodi: Well, I think you actually have hit the nail on the head. I think the key is that the advisors around these employers, whether it's the advisor, whether it's you guys, or combination helping the employer to keep track of these kinds of things and say, you know, circle them back to the decision that was made when they were struggling and say, well, you know, you can get a separate deduction from this apart from the deduction you're getting for the plan. You were able to afford this before. Now you're back to where you need to be. I think that's a good thing to do. But I think the onus is going to be on you guys to be doing that. The employer is probably not going to do that on their own. [31:55] JD: No. [31:56] Sal Tripodi: Once they shift that to the plan and they see that they're not writing a check, that's good. [32:01] Chad: I got this. [32:02] JD: I'm going to drink for you, Sal. No, I. [32:05] Chad: Mark, here's what I'll say to that. [32:07] JD: You guys need it. [32:08] Chad: You're arguing the timing of making that trunk right? You're arguing the timing where we're at currently. Because if a client comes over and They've got a $10 million balance, a balance in their entire company's program, and they say, and Jake put it in there, you go to a provider that's got heavy rev share and the TPA doesn't need any costs because they're getting enough and there's no additional fee to be billed. You're not going to come back and be like, well, no, no, no. Let's carve out the rev share and let's go ahead and set up a billable fee. You're going to let it go down that path. You're saying the timing right now because of the state we're in, that pushing cost to plan assets. Dang. Is a bad idea unless you're smart enough to back it out later. And we have this conversation all the time when we set up startup programs. We tell a client 100% take on the fees, you have a deduction. You're gonna have the majority of the assets. A few years later, they come back and they say, look, plan's a two million dollar plan now. Dang it, two, three more and I owe you a lot of money. Because it's a $3 million program and everything is still billable. Let's say it's an advisory cost and it's billable. And then they say, can I make that an asset based charge now? And we're usually going be careful. If you're going to take 50 basis points and push it into the program's cost, you're going to get an uproar from your staff. So there's a difference between current timing and making this change. Any other time. Let's say when a program's moving vendors, and I think your argument is sound for saying right now, I have no issues like Sal was saying, for a client deciding to move those costs to the program in a general sense, but it's the timing and it's the look that JD's referencing. When the economy is bad, you're saying the business is struggling. That's why I need that three grand. And I get that, I get that side of it. [34:04] Mark: Did you guys see every situation? Every and every setup is different. It has to be evaluated on a case by case scenario. But I don't like that feel of doing it for this particular reason right now. [34:21] JD: And that's why I asked, I asked about the current situation, the current optics. I liked Sal's response to you, though. It was the most intelligent response, which is, as a small business owner, if you're just trying to keep the lights on and yes, you let half of your staff go and you're cutting all the overhead you can cut because you're trying to survive and get through the next three months. If part of that survival is shifting these costs to, it's better than shutting down the whole plan and firing everybody and shuttering up your shop. So did I say that? [34:55] Speaker E: We'll ask if there'd be an issue with participants leaving the employer altogether if the employer made that transition. I mean, my personal opinion on that right now is that I think they'd just be glad to have a job at the moment rather than losing their entire income if they can't get a new spot. [35:14] Chad: I had a similar conversation for probably the first one I've had on this kind of candor this morning, where an advisor was asking me how to approach Calsavers, still knowing that the deadline was pushed to September And I'm like, dude, if you call a prospect and try to talk about CalSavers right now, a company that's never put a program in place before, you're barking up a bad tree. And I almost feel like that's in bad taste to make that call. Do you want to make calls to prospects right now regarding the program, the world that we all live in? Talk to them about CRDs. Talk to them about accessing cash. Talk to them about procedures. Talk to them about the PPP. Don't get into CalSavers right now and making sure that they're covered. Maybe in July you start to ask those questions again. If September's still a deadline. [36:03] JD: Mark. Mark Paone. I can't pronounce your last name. Mark says Rev Share is old school. Bro. I added the bro. And bad for business only. Acceptable use is to send the rev share back to the source. That's an argument for another day. Mark, I'd love to take it up with you. [36:20] Chad: An accounting nightmare for people that have to do it. [36:22] JD: I think that's. That's a great subject. We should dive deep into it at one point. I agree. In a sense, I agree. I think you should strip it all down and have zero Rev Share. But in the current atmosphere, using Rev Share, disclosing it is and doing it properly, there's ways around it to do it right. But I hear you less. You guys did beautifully. That's exactly what I wanted to do. I wanted to get both sides of the story. I wanted to get Mark fired up a little bit. I was hoping that Sal would get a little tipsy and drunk so everything's going according to plan. Plan. [36:54] Sal Tripodi: The chat seems to think I'm much drunker than I am. I don't. [37:00] Chad: We just. We just know your. Your, Your abilities, Sal. They don't. [37:06] JD: Let's shift it. [37:07] Chad: You can handle. [37:08] JD: Let's shift it up again. Let's shift it up again and let's. Mark, I think you've got a little. Little game that we can play. Something of your creation. [37:17] Mark: I've got something up my sleeve, if you know what I mean. You guys want to play a little game? [37:26] Chad: Yeah. [37:26] JD: Yes. [37:29] Mark: So here's. First, what I'm gonna say is it's rather simple. It's in the category of a yes, no game. I'm gonna be completely honest. I didn't read JD's email till like midnight last night where he was instructing me on any to come up with this. So I haven't spent a lot of time on it. So it's in beta mode right now. Okay. [37:45] JD: First and foremost, AKA suck. [37:47] Mark: Yeah, it will for sure edit out. No big deal. We move on. Audience, please partake in this. Please chime in. Justin's having a hard time keeping up with chat as is, so please flood it even more. So here's how it's gonna work. I don't have a cool name for the segment yet. I've bounced around a couple ideas. You know, it's, it's, it's gonna, it'll come to fruition at some point, but at this point, what I have for you is a game called I'm game or it's lame. [38:17] JD: Oh, okay. [38:18] Mark: Yes or no. It rhymes. It's not that catchy yet I like it. I'm gonna throw some questions at you and I'm gonna ask each of you what your thoughts are. Either you're. If you're game, it's like a yeah. If your life, it's lame, it's like a no. Right? Everybody understand? Not for my yeah. Before I go on. This segment is brought to you by. [38:40] Chad: Oh, geez. [38:43] Mark: Advisor 2X. Because they were advisor 1X going into quarantine anyway, so let's move on. My first question to you all beautiful people is. And this is JD's question. I'm just going to be honest with everybody. [39:00] Chad: It. [39:01] Mark: If you get an email from somebody and there is nothing in the body of the actual email and there's a question in the subject line like, hey, want to grab coffee tomorrow? Or hey, call me. Keep your answer. [39:17] JD: Katie, what Mark's referring to. Have you seen these people? They use the subject line to communicate important things to you, but not the body of the email. And I. [39:31] Mark: This is my show. Don't. Don't fucking explain what I'm trying to do. [39:34] JD: I say. I say that is totally lame. [39:37] Chad: Lame. [39:38] JD: Freaking hate that. [39:39] Chad: Oh, come on, Sal. [39:41] JD: Does it. [39:42] Sal Tripodi: It's efficient communication. And especially if you don't. If you might not have this person's phone number so you can't text that. I think putting it in the subject line is perfectly acceptable. [39:53] Mark: No, it's like texting the subject line input. Read my email and then you put it in the email. [40:01] Sal Tripodi: That's lamer. [40:04] Mark: You are wrong. [40:05] JD: Don't even put. [40:05] Chad: Read my email. Just put like, what's up, Sal? And then an email be like, hey, you want to go grab a cocktail? [40:11] Sal Tripodi: I have done that several times. [40:13] Mark: Justin, I haven't heard you say a thing yet. [40:17] Chad: I agree. [40:18] Speaker E: I hate it. [40:19] JD: Yes. [40:21] Chad: Mark. [40:22] JD: Hold on, hold on. [40:23] Chad: Who's Guilty of ever using that, though. [40:26] Mark: No, you don't get to ask questions in my game. [40:28] Chad: Never. [40:28] JD: Doomer. Just the boomer. [40:30] Sal Tripodi: The Boomer. Okay, we're gonna bash the boomers again. [40:34] Chad: Next. [40:35] Mark: Next. Everyone, quiet, please. Hard seltzers. I'm game. [40:42] Sal Tripodi: Or is it lame? [40:45] Chad: Game. Game. Thank you. [40:47] Mark: Bring them on, you guys. If you're not drinking those, you're lame. All right, moving on. [40:54] Sal Tripodi: They're terrible. [40:55] JD: PCH says lame. [40:57] Mark: I gotta do a poll on that one. [40:59] Chad: Yes, we need to. [41:01] Mark: Actually, I'm gonna keep it to one. We're gonna. We're gonna end it here. [41:03] Sal Tripodi: Lames on the chat there. [41:07] Mark: If you were buried neck high in a pile of shit and I threw a baseball at your face, would you duck? [41:17] Sal Tripodi: Oh, okay. [41:22] JD: Are we going to me first again or. [41:24] Mark: No, let's go to Justin first. [41:26] Chad: Here on this one. I got hard head. [41:29] Speaker E: I'd take it. [41:32] Mark: Chad, you're next. [41:34] Chad: I'm for sure wearing it. I'm gonna try to turn a little bit and let this side take it. [41:38] Mark: Sal. [41:39] Sal Tripodi: Yeah, I wouldn't duck, J.D. [41:43] JD: i'm figuring you're already covered in shit, [41:49] Mark: so why. [41:50] JD: Why has. No. I'm gonna. Yeah, I'm gonna duck. I'm gonna get shit on me, and then I'm gonna get out of it. But you guys will have black eyes or bruises, and I'll be fine. [42:00] Mark: Why is no factor in the fact [42:02] Chad: that I. Jd, think about it. [42:03] Mark: It's gonna get stuck. [42:04] Chad: I was gonna throw the ball. [42:06] Mark: Me. I'm gonna probably miss you. Right? [42:10] Chad: Fair enough. [42:12] Mark: You took. [42:14] Chad: I'm upset that we don't get a vote on this. By the way. Seltzer or no seltzer, panelists don't get a vote. [42:20] JD: Yeah, the question is seltzer or no seltzer. [42:23] Chad: Apparently. [42:24] JD: Mark, just so you know, when I. When I wanted us to do this game, I thought the questions would be business related. Not shit related, but go ahead. [42:34] Mark: Well, I have a lot of. I had a lot of nerdy questions lined up. I even had the title of the show be Opt in or Opt out to kind of relate to 401k stuff. But I thought that was really too nerdy for me, so I opted out [42:49] Chad: to go that route. [42:50] Mark: So. And the way I end every segment is. You know what they say? [43:01] Chad: No, I don't. What do they say? [43:05] Mark: What's that? [43:05] JD: I like it. First of all, I love the name. I love the name and I love the ending. Well done. Can't wait till next show. [43:13] Speaker E: Paul Rossi is saying to call that the lame game. Mark. [43:16] JD: Ooh, nice. [43:17] Chad: Lame game. [43:18] Mark: Yeah. If I can ask for any help here from the audiences creativity with names for the segment and also questions, obviously I could use some help there. [43:32] Chad: Hey Sal, there was a question that came in on the board earlier. It's a bit of a lengthy perhaps digest and chew it over one, but I'm going to throw it out there because I think it could be for some good banter regarding the secure act. An advisor asked if a 10 person shop became a PPP, which I believe is a preferred plant. Preferred, I'm not going to say IT provider. Could they outsource the 316 duties? And let me go back and make sure I'm reading his exact question right and become a service provider. [44:08] JD: And then he just added the key part of my question is outsourcing. Can an advisor shop, can they be [44:14] Chad: a PPP while outsourcing the 316 work? Okay, now I get where you're coming from. [44:19] Sal Tripodi: Yeah. Well, I mean based on what I read in the statute, I think a PPP can outsource any part of what they are required to do as long as they have ultimate responsibility to make sure it gets done. [44:30] Chad: Yeah, they're the conduit, right? [44:33] Sal Tripodi: Yeah. I mean they have to, they have to be the, they have to make sure that all those tasks get done for the plot, for the, for the ppp, for the vehicle. But they, they don't have to personally provide every one of those services. I think they can certainly outsource. [44:54] Chad: Absolutely. I feel like at that point you're signing on as the PPP, I believe as a 316. Right. Even though you're outsourcing, so you're taking on responsibility for another provider to do the work. It might be a little risky. [45:10] Sal Tripodi: Yeah, I would imagine that. So I guess I see the question, the chat box there. It's impractical for an advisor group to be a 316. Again, they do have. That's the only thing the statute specifically says is that they have to be the plan administrator. It does not specifically allow them to outsource that service, but they have other requirements that they have. So maybe it should be reversed. Maybe the advisor group should more be contracting with PPPs that are plan administrators to do those advisor services. [45:48] Mark: Hmm. [45:49] Chad: Okay jd, my question for Sal, which I'm genuinely curious about because I know how we explain this and as TPAs we get this question all the time. Why in all of your years of experience, I'm sure you've answered this. Why does the ADP test Exist. [46:09] Sal Tripodi: Well, it's like with everything else that's provided through these plans, there's an obsession to making sure that there's a as level a playing field as you can create. [46:23] JD: And I'm drinking for salad. [46:26] Sal Tripodi: The concern has always been for highly compensated employees to avail themselves more than non highly compensated employees. It's just inherent in all of what we do in the qualified. [46:38] Chad: Now I understand that it exists and I understand that I guess you could say that that's the why. But my question is in today's day and age, why is it fair that someone in California who needs a certain amount of money to make ends meet, who makes 126,000 is limited by this test? When someone sitting in central Missouri who makes 124,000 has no issues maximizing deferral. So I just don't feel that it's fair. [47:12] Sal Tripodi: I think that's going to a bigger question then it's not really the ADP that's the issue. It's the way we set limitations and defining highly compensated. I think Congress is wary about going down a road where we look at geographical area. But it does make more sense actually to define these limits. And the way you define a highly compensated employee probably should be done regionally. It probably shouldn't be a one size fits all test. [47:40] JD: Chad. Chad wants. [47:41] Chad: I like that answer. [47:42] JD: Chad wants California to branch out on its own and become its own country and leave the United States. I think is what he's saying. [47:51] Chad: No, so we get, we get into this debate all the time internally and as a group where if, if I were sitting at the top of the government had the ability to take away some restrictions inside this industry, what would it be? One for me would be the ADP test. I think regardless of your income, you should be able to maximize your deferrals if you have the ability to. That's why we have a deferral limit. That's why the limit is not infinity. The limit is a dollar amount is because it's supposed to stop someone from going too far, too high. And if we feel that 195 is not too high, then anybody should be able to get there. And secondarily I think cross testing is, is unfair. I think a 30 year old owner with 5 older employees is hindered. If that 30 year old owner had 518 year old employees, he would have no issue. So I think cross testing, I think there should be a minimum gateway. But I don't believe cross testing should exist in that, in that fashion either. Those would be the two things I would pull. [48:51] Sal Tripodi: Well, you know, actually when they first. I don't know if you're probably not maybe not aware of this, but when they started the 402 limit, which was in 1987, before that time you could actually defer up to whatever the 415 limit was. So there was a time you could defer up to 45,000 in the early 80s. So when that was lowered, they adopted 11,000 as the original limit. There was a lot of talk about eliminating the ADP test because it really. There wasn't that ability to get to a very high deferral anyway for a highly compensated person. I mean it's almost double where it started once they did that. But I think there's a lot to be said for that. That when you limit contributions within a certain range, it doesn't make sense to go through all the mechanics of the discrimination testing where individuals who can avail themselves of the full 19,500, it's not a very big percentage of their pay anyway. [49:53] JD: You guys are forgetting one very important fact. Which is, which is that the more complicated all this stuff is, the better to be a third party administrator. If you, if Chad goes down his Bernie Sanders route and makes everything Bernie Sanders route, then, then I'm out of a job and, and if I'm out of a job, then you three fuckers are out of a job too. [50:20] Chad: Hey, what did Brian Graf tell us in Washington? If they pull all those things, then we just all have to go back to consulting, which is real hunting, right? You just gotta be a consultant only. [50:33] JD: I'm kidding. A lot of these rules seem very, very silly and over complex and just too much. [50:39] Sal Tripodi: Top heavy. Top heavy shouldn't exist anymore. [50:42] JD: That's a weird one too. Yeah, it's a weird one. Sal, we're into our long mode now, so we're coming to a close. We're getting down to the end here. I wanted to ask you about partial plan terms. Given the current space we're in, and I've got bigger clients that are furloughing lots of people. I've got clients that are terminating people. Is. Do you believe that partial plan term is as simple as if you terminate 20% of your staff and you have to accelerate vesting from, you know, whatever to 100% vested? Or is that rule a lot more complicated than it at first appears? [51:29] Sal Tripodi: No, I think it's pretty straightforward. I mean you do have the ability to, to show that your facts and circumstances might be different. But I think that generally if it's over 20%. You should be treating that as a partial termination. [51:44] JD: Okay. Second part, that rule was, I don't think was never designed to deal with a national disaster or a country at war or a country, you know, dealing with some other, you know, mass. You know, what we're dealing with right now. So is it possible that we could have legislation? Is it. Do you think it should. Do you think we should have legislation that it's not these employers fault that they're having to let all these people go, it's the fault of this unforeseen virus that came about? [52:24] Sal Tripodi: But I think the answer to that's going to be, you know, first of all, we're dealing in an environment where it's only a six year year period maximum to fully vest. And I think to try to argue that, you know, these are times in particular where employees could really use the additional vesting. So I just don't think that's going to go anywhere to try to get legislation to change that. [52:45] JD: Damn it, you're making me look like the bad guy. [52:47] Chad: No, I was going to say, come on. Legislation changing to withhold a benefit from employees that's already been paid out and deducted as an employee. Employee Earth. There's no way that comes down. [53:00] JD: Yeah, just remember, you guys are all okay with vesting schedules in the beginning. I mean, no 1's against a 6 year grade investing schedule. It's just now this employer has no other choice but to get rid of all these people and well, the money's [53:18] Sal Tripodi: been already allocated to the employer. Maybe you have an argument with defined benefit, but, but to find contribution plans, you already have money allocated and you know, the argument could be made. This employee probably would have stayed long enough to fully vest. It's just that their term was cut short. [53:37] JD: Will says. How much does it really cost to 100% vest people? Will, the client I was talking today to, I spent about two hours going back and forth on the phone. That cost was $565,000. [53:52] Speaker E: Was. [53:53] Chad: No, that's. No, that cost has already been written off as a deductible expense for the contribution from the business. Yeah, I hear you. So it's not something that's coming out of pocket for them. Pulling it back from participant accounts. [54:04] JD: Fine, Chad, I'm just trying to come up with some fucking decent questions. [54:10] Chad: It is a good question. I just, I'm on the side of that it should. That no legislation should come down changing that. [54:17] JD: All right, well, we're getting to the end. We're chilling. Is there anything you Guys want to ask this guy in? Anybody in the audience throw something at Sal before we shut this thing down? Chad's got his hand raised. [54:28] Chad: Hey, Chad, I've got Sal sitting here. You can't think I didn't already write down questions. [54:34] JD: We'll talk to him all night. Let's do it. [54:37] Chad: So, Sal, something that's coming up often that I think people might be interested in, we're seeing. With the popularity growing in peos and maps, I'm seeing more and more programs roll out of them. So I'm seeing businesses leave a map quite often. And I'll be Quite honest, the MEPs are playing hardball as to how this goes. And so I ran into an example this week. I have a client that opened up a division in California. They're not part of the PEO that the plan is operated on under Minnesota, in Minnesota. So the employees are not part of this peo. They can't participate in that map that. That PEO has open. Right now we're considering. Open up opening up a secondary plan for these employees and mimicking provisions to make them look as identical as we can until they can get out of this relationship with the PEO and move everybody over next January. The question is equal rights, benefits and features. We can't get, we can't get good pricing on a startup plan when the map, when the map already has solid pricing with a large group of employees. And this is a startup in this scenario. So equal rights, benefits and features. Is it bad for these employees that are going to have a higher cost structure to their program versus the other half of the company that's sitting in the map? [56:04] JD: That was a long fucking question. [56:06] Chad: I set the stage, J.D. i set the stage. [56:08] Sal Tripodi: I mean, there are some things you can overcome. I mean, the fact is without. Without having some different structure of expenses, these individuals couldn't have a vehicle for themselves to participate in. So I think it's more the focus, more should be trying to parallel the benefits the best you can rather than worrying about the specifics of fees that might. You might. It might be impossible to actually equalize [56:34] Chad: those which, which we are. Now there is a way out of. It is these, these MEPs, these PEOs are a CO. Employer agreement, right? So the employees don't have to participate in that PEO in that map. If we open up the secondary plan, you can have the. [56:50] JD: Dang it. [56:51] Chad: The employees participate over there. And that's how I'm advising this client, is to say, look, you. You want, you will be moving from that PEO you, you're not liking the services they're delivering. So start now, shut down the relationship with that mep. You still maintain them for the peo. Cause your contract goes through December. But bring everybody over to this new program. Bring those assets over now that's going to allow you to get better pricing for everybody over here because those assets will now transfer out of that mep. [57:21] Sal Tripodi: Well, I mean that's good advice. I just don't think that the discrimination test that you're concerned about is really going. It doesn't bring the expense of the relative expenses. [57:34] Chad: Okay. [57:34] Sal Tripodi: That's more of a ERISA issue, not a qualification issue. [57:38] Chad: And we've ran into that in the past too, where some companies will have one plan with Voya and dang it, one program with Voya, one program with mas, one program with Principal because they have individual divisions that don't communicate and they have their own program set up. And one program has a 2% operating expense because it's brand new and the other one has a 75 basis point operating expense because it's got, you know, $8 million in it. And trying to advise them of like, look, your fiduciary duty is to bring these together because that business is paying 2% shouldn't be. Because they're all part of this control group. And I always reference equal rights, benefits and features. If it's part of a control group trying to, trying to encourage them to do the right thing. [58:20] JD: Dad, you know when on a Snoopy or what was the. What was Snoopy show Charlie? Where the Charlie Brown where the teacher talks and you hear. That's what I just felt like when you were talking. [58:35] Chad: You're welcome. J.D. [58:36] JD: i saw you trying to talk one of our. Mark Piaani. Mark Piaani, he's from Hawaii. I think I made that up. He wants to know, can you take Covid related distribution from your 401k plan and then roll it to an IRA? Yeah, yeah, you can roll it to the IRA. [58:59] Sal Tripodi: You can do that. I mean they're not actually requiring to be eligible for those distributions. They're not requiring that you use that money for any specific purpose. It's allowing you to. I mean if that was the. If the purpose for the individual is they wanted to move it out of their employers vehicle and move it to their IRA to have control over that in a different way, that's fine. I mean I can't imagine that there are that many individuals taking these distributions that are going to roll them to their IRAs. Great. [59:30] JD: We're just Going to keep firing these questions at you. Jake Rushton says, what resources would Sal recommend to help determine control groups and ASGs other than an expensive ERISA attorney? Okay, interesting. [59:47] Sal Tripodi: Well, there are. I mean, actually, there's good information both in the ERISA outline book and also in Darren Watson's publication that could probably help with that. I think I would certainly try to start with something like that. You know, a lot of your control group and affiliated service group situations are going to be straightforward, and you certainly don't want to be expending dollars to get an outside opinion on that when it's clear. But I think certainly the affiliated service group in particular, there's some weird scenarios there, and I would generally recommend you go through the expense of an attorney. [1:00:22] JD: That one is complicated. [1:00:24] Chad: And, Jake, I'll add to that. Often a TPA can give you a lot of groundwork in that discussion. And like Sal's saying, quite often it's pretty clear to us. And so while we can't officially issue an opinion, we can usually tell you pretty clear what it is. And if we can't, I'll tell you, there's been a number of times, because of our relationships with ERISA attorneys, we pose the question to them, and they don't. They don't charge the client because it's pretty easy for that ERISA attorney then. [1:00:50] Sal Tripodi: And remember, too, that IRS won't go. Won't give you determination letters on this anymore on the affiliated service group. So I think it has enhanced the role of the attorney now to provide some comfort level for the employer as to whether they have one or not. [1:01:08] Mark: Who's your favorite ERISA attorney? Sal? Who? [1:01:11] Sal Tripodi: My favorite erisa. [1:01:13] Mark: Yeah. [1:01:14] JD: Good question. I can't. [1:01:15] Sal Tripodi: I'm not answering questions. [1:01:17] Mark: Come on. [1:01:18] Sal Tripodi: Come on. [1:01:19] Mark: Just tell me. What is his or her name rhymes with. [1:01:24] Sal Tripodi: I could tell you some that I really like. Would you like that? [1:01:30] Chad: He did the Mount Rushmore. Remember the Mount Rushmore? [1:01:34] JD: No. [1:01:34] Sal Tripodi: I thought about the Mount Rushmore. I realized I don't want to be on Mount Rushmore. I want to be Crazy Horse. [1:01:41] JD: That suits you. That suits you. By the way. I don't. Let's end it with this. I don't think you guys know, but Sal is like a legitimate celebrity in the TPA world. So for, you know, 20 years ago. Shit, 25 years ago. And keep going. TPAs at water coolers all over the country would talk about Sal Tripote. And you know why? Because the word on the street was he was giving these very charismatic technical summaries like, so he would go from city to city, do his presentation, but he would do it with humor. He would do it with charisma, he would do it with personality. And I might say a lot of the. A lot of people were falling in love with Sal and his handsome looks and his jokes and his whatever, but this guy was like, legit. It still is. Sorry. Still is legit. I just don't know if you guys know that. That TPA's love this. [1:02:45] Sal Tripodi: Where's this going, JD? I don't know why you, why are [1:02:49] Chad: you saying that JD's hoping to be used this much, this much like next year. He wants to start riding the eob. [1:02:55] JD: I love you, man. I love you. [1:02:56] Chad: Hey, Sal, we got one more question [1:02:58] Speaker E: that came in for you. So some have seen as many companies buying other companies and ending up with a control group a year or two down the road. Should they go back and correct if they didn't notice it in the beginning that they were control group? [1:03:12] Sal Tripodi: Well, I would always recommend correcting to the extent it's practical to do so. And there's some. In some cases, you may have to estimate some requirements, but you don't want to hold the plan out, as in non compliance, because the IRS's position is, and it's been upheld by the courts, is that if you. A disqualifying defect in a plan taints all future years until it's. Until it's. [1:03:39] Chad: I'm trying to help you here, Sal. [1:03:42] JD: This is called Sal is Hammered show. [1:03:45] Sal Tripodi: I am not hammered. [1:03:46] Chad: I know. We'll say I'm happy that whatever it is that I pulled out. Out of the closet for Drinking is only 21% alcohol by volume. So that's better. Better than most of the stuff. [1:03:56] Sal Tripodi: Well, my. What is mine. [1:03:58] Chad: You're probably 40% if you're drinking single malt. [1:04:01] Sal Tripodi: Yeah. 45.8. [1:04:05] JD: For the attendees. For the attendees that have stuck around. Thank you. You guys are awesome sticking around for this whole deal. [1:04:13] Chad: Sylvia. I'll look into that. [1:04:15] JD: Sylvia, I appreciate all the feedback, all the questions. That's awesome. And she's drinking wine. [1:04:20] Sal Tripodi: Thanks for all the chatters. That's been nice. Thank you. [1:04:23] JD: I think she's been drinking wine. She told me. Well, Sal, it's been a pleasure. It's been a privilege to have somebody with your size of brain on our show. [1:04:35] Sal Tripodi: So maybe I'm gonna watch Happy Gilmore now. [1:04:40] JD: You should. Maybe we can have you back sometime in the next few weeks. And I promise, if we have you back, we. We will play the movie game with only boomer movies, and you can. [1:04:51] Sal Tripodi: No, I don't need just boomer movies, but something, you know. How about Parasite? Something like that? [1:04:56] JD: Come on, that was a great flick. [1:04:58] Chad: I haven't seen that flick. [1:04:59] Sal Tripodi: It was great. [1:05:00] JD: Oh, phenomenal movie. Parasite. [1:05:03] Mark: Hold on. Sal, you mentioned earlier that you've learned that you actually know how to cook. I'm just curious. What's your favorite meal to cook right now while in quarantine? [1:05:16] Sal Tripodi: Well, I made this thing. It's called Marshalla, this North African dish that I found on the Internet. It was great. [1:05:22] Mark: So you're. You're. You're going big. [1:05:25] Sal Tripodi: I am going big. I will have one. Next time we're together, I will have made one of these, and I will present it at the. [1:05:32] Mark: Yeah, buddy. [1:05:33] Sal Tripodi: I will not come back if plan is the. [1:05:39] Chad: Thanks, J.D. [1:05:40] JD: everybody say the word and take a drink. Plan. [1:05:46] Chad: Good night. All saying it. [1:05:48] JD: All right, guys. See you later. [1:05:50] Chad: See you. See you, Sal. Thank you. [1:05:52] Mark: Thanks, Sal. [1:05:53] Chad: Bye, everybody. Appreciate it. See you on Thursday.