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Does any recordkeeper offer (assuming the customer plan has enough purchasing power) services to support the professors' "Retirement Guardrails" idea? For example, imagine a plan's sponsor/administrator specifies that a mutual fund investing in securities about gold or precious metals is a designated investment alternative but only for no more than 5% of a participant's account. Has any recordkeeper developed the systems to apply that "guardrail" constraint?

Late Friday, brain freeze time Need to check something with the gurus as I have been researching and failing to find. Testing for 401a26 and annual method fails. Software has couple options: 1. Change to average salary (highest 3) and test against annual accrual 2. Change to average salary and use accrued-to-date method (been doing the plan since day one so have all the data) Any issues with either of the above? Also, I could not find anything that would prohibit me testing 410b and 401a4 using different methods than 401a26. Anything I am not able to find? Thank you

for SetAway, LLC (Remote / CT / MA / ME / NH / VT / Hybrid)View the full text of this job opportunity

for Aon (Remote / Hybrid)View the full text of this job opportunity

WHO CAN SUE UNDER ERISA A plaintiff has standing to bring a claim under ERISA if he/she is a plan participant, beneficiary, or fiduciary. Caples v. U.S. Foodservice, Inc., 444 F. App'x 49, 52 (5th Cir. 2011) (citing 29 U.S.C. § 1132(a)); Cobb, 461 F.3d at 634; Coleman v. Champion Int'l Corp., 992 F.2d 530, 533 (5th Cir. 1993). A "participant" under ERISA is an "employee or former employee" of an employer offering an employee benefit plan. 29 U.S.C. § 1002(7). A "fiduciary" is someone who (1) exercises "discretionary authority . . . respecting management of such plan or . . . disposition of its assets," (2) "renders investment advice for . . . compensation . . . with respect to any moneys or other property of such plan," or (3) "has any discretionary authority or . . . responsibility in the administration of such plan," Id. § 1002(21)(A). A "beneficiary" is defined as "a person designated by a participant, or by the terms of an employee benefit plan, who is or may become entitled to a benefit thereunder." Id. § 1002(8). In order to qualify as a beneficiary, an individual must have "a reasonable or colorable claim to benefits." Crawford v. Roane, 53 F.3d 750, 754 (6th Cir. 1995); see also Cobb, 461 F.3d at 635-36 (holding that to have standing as a beneficiary under ERISA, a plaintiff must show both that he or she was designated as such by the participant or terms of the plan, and that he or she has a colorable entitlement to benefits under the plan). In Parsons v. Board of Trustees of the Boilermaker-Blacksmith National Pension Trust, Civil Action No. 2:20-cv-00132, USDC (S.D. WV 2020) that you can find at - https://scholar.google.com/scholar_case?case=12166270204191846086&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt&hist=bY5nDLcAAAAJ:14880692104701005079:AAGBfm2qi1_JaXLJvydb4f3quYTnTlLkbA, the Court set forth a good summary of the rights of potential Alternate Payees to sue a pension plan for benefits claimed to be payable by reason of a QDRO. At issue in this case was whether or not the language of the QDRO was broad enough to include survivor annuity benefits. Said the Court - “ERISA was enacted to protect employees and their beneficiaries by ensuring the proper administration of employee benefit plans. Boggs v. Boggs, 520 U.S. 833, 839 (1997). The Retirement Equity Act of 1984 (REA) amended ERISA with respect to surviving spouses in two important ways. REA requires pension plans to provide automatic benefits to surviving spouses. Id. at 843; 29 U.S.C. § 1055(a). Additionally, while ERISA generally prohibits assignment or alienation of benefits under a pension plan, REA provides for a Qualified Domestic Relation Order (QDRO) exception wherein a former spouse or children of a previous marriage may be designated as an alternate payee and thereby "receive all or a portion of the benefits payable with respect to a participant under the plan." 29 U.S.C. § 1056(d)(3)(B)(i)(l). “A domestic relations order is any judgment, decree, or property settlement that "relates to the provision of child support, alimony payments, or marital property rights to a spouse, former spouse, child, or other dependent of a participant" and "is made pursuant to a State domestic relations law." Id. at § 1056(d)(3)(B)(ii). However, in order for a domestic relations order to qualify as a QDRO, it must meet the following requirements: (1) the order must specify the name and mailing address of the alternate payee and the affected plan participant, (2) the amount or percentage of the participant's benefits to be paid or the means by which that amount will be determined, (3) the number of payments or time period to which the order applies, and (4) each plan to which the order applies. Id. at § 1056(d)(3)(C). Moreover, a QDRO cannot (1) require the plan to provide any type of benefit not otherwise provided, (2) require the plan to provide increased benefits, or (3) require benefits to be paid to an alternate payee which must be paid to another alternate payee under the QDRO. Id. at § 1056(d)(3)(D). “A plan administrator generally has discretion to determine whether a domestic relations order constitutes a QDRO, but such determinations are reviewable by courts. Dorn v. Int'l Bhd. of Elec. Workers, 211 F.3d 938, 946 (5th Cir. 2000). In determining whether a domestic relations order is a QDRO, courts have required substantial compliance with the drafting requirements. Hamilton v. Washington State Plumbing & Pipefitting Indus. Pension Plan, 433 F.3d 1091, 1097 (9th Cir. 2006). The "pivotal question is whether the dissolution order `clearly contains the information specified in the statute that a plan administrator would need to make an informed decision.'" Id. (quoting Stewart v. Thorpe Holding Co. Profit Sharing Plan, 207 F.3d 1143, 1154 (9th Cir. 2000)). “If a domestic relations order qualifies as a QDRO, then "any spouse, former spouse, child, or other dependent of a participant" that is designated as an alternate payee shall be considered a "beneficiary under the plan." Id. at §§ 1056(d)(3)(J)-(K). Thereby, a former spouse can obtain a secured interest in benefits merely by obtaining a QDRO. Id. at 1056(d)(3)(A); Metro. Life Ins. Co. v. Pettit, 164 F.3d 857, 864 (4th Cir. 1998); Hopkins v. AT&T Global Info. Solutions Co., 105 F.3d 153, 157 (4th Cir. 1997). “As noted above, ERISA requires pension plans to provide automatic survivor benefits to retiring participants. Dorn, 211 F.3d at 943. A Qualified Q Annuity (QJ&SA) is the principal mechanism for providing such survivor benefits. Id. "[A] QJ&SA comprises two separate and distinct benefits: (1) An annuity for the life of the participant, and (2) a succeeding annuity for the life of the surviving spouse (if there is one) of not less than 50% of the participant annuity." Id. Generally, in order for one to qualify as a surviving spouse in the context of a QJ&SA they must be married to the participant "(1) during the applicable election period, (2) on the annuity starting date, or (3) at [the participant's] death." Id. at 947 (internal quotation marks omitted). “Former spouses, however, can also receive surviving spouse benefits under certain circumstances. "To the extent provided in any qualified domestic relations order ... the former spouse of a participant shall be treated as a surviving spouse of such participant." 29 U.S.C. § 1056(d)(3)(F)(i) (emphasis added). Federal courts have held that, in order for a former spouse to be entitled to surviving spouse rights, "any assignment of surviving spouse rights in a QDRO must be explicit, rather than implicit." Hamilton, 433 F.3d at 1099; Hopkins, 105 F.3d at 155; Dorn, 211 F.3d at 947. Moreover, where a QDRO is silent as to surviving spouse rights, a designation of alternate payee or beneficiary does not elevate one to the status of a surviving spouse entitled to a survivor annuity under a QJ&SA. Dorn, 211 F.3d at 947. “The detailed requirements for drafting a QDRO have been characterized as a "drafting morass for the lawyer." Hamilton, 433 F.3d at 1096. The Court recognizes "the concern expressed by courts and commentators that the failure of domestic relations lawyers to `navigate the treacherous shoals' of ERISA may harm potential beneficiaries." Id. (quoting Metro. Life Ins. Co. v. Wheaton, 42 F.3d 1080 (7th Cir. 1994)). Nevertheless, "Congress required that QDROs be specific and clear because it was concerned with reducing the expense to plan providers and protecting them from suits for making improper payments." Id. at 1096-97 (quoting In re Gendreau, 122 F.3d 815, 817-18 (9th Cir. 1997)) (internal quotation marks omitted). As an initial matter, the Plaintiff argues that the Court should not consider the QDRO or the Plan Document, because review of such documents is premature at the motion to dismiss stage and would instead convert this motion into one for summary judgment. This argument is without merit. For purposes of a motion to dismiss, "a court may consider official public records, documents central to the plaintiff's claim, and documents sufficiently referred to in the complaint so long as the authenticity of these documents is not disputed." Witthohn v. Fed. Ins. Co., 164 Fed. Appx. 395, 396 (4th Cir. 2006). A court may also consider pension plan documents for a motion to dismiss when a plaintiff relies on such documents in the complaint. Stewart v. Pension Trust of Bethlehem Steel Corp., 12 Fed. Appx. 174, 176 (4th Cir. 2001). Both the QDRO and the Plan Document fall under this umbrella and may be considered in light of the motion to dismiss.” ERISA § 404(a)(1) sets forth the primary duties of an ERISA fiduciary, providing that a fiduciary must: (1) act solely in the interest of plan participants and beneficiaries for the exclusive purpose of providing benefits to participants and their beneficiaries; (2) act with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like aims; (3) diversify the investments of a plan so as to minimize the risk of large losses; and (4) act in accordance with the documents and instruments governing the plan insofar as they are consistent with the provisions of Titles I and IV of ERISA. 29 U.S.C. § 1104. A fiduciary may be personally liable for, and removed as a fiduciary as a result of, any breaches of the responsibilities, obligations, and duties imposed by the statute while acting as a fiduciary under ERISA. ERISA § 409. 29 U.S.C. § 1109. Generally, to state a claim for breach of fiduciary duty under ERISA, a plaintiff must allege that: (1) the defendant was a fiduciary of an ERISA plan who, (2) acting within his capacity as a fiduciary, (3) engaged in conduct constituting a breach of his fiduciary duty. A good case discussing breach of fiduciary duty is Volz v. General Motors, Civil Action No. 22-cv-3471, United States District Court, E.D. Pennsylvania (October 5, 2023)- https://scholar.google.com/scholar_case?case=10217039916663686201&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt&hist=bY5nDLcAAAAJ:17102308171145443235:AFWwaea94w7XgMVkZLP-Q4RdIOLK&html=&pos=1&folt=kw See also, 29 U.S.C. § 1104(a)(1) (duty of loyalty) and 29 U.S.C. § 1104(a)(1)(B) (duty of prudence). See Barker v. Am. Mobil Power Corp., 64 F.3d 1397, 1403 (9th Cir. 1995) (ERISA's duty to act in the best interests of the plan participants and beneficiaries includes a duty to investigate suspicions that one has concerning the plan); see also Patterson v. Reliance Standard Life Ins. Co., 986 F. Supp. 2d 1140, 1150 (C.D. Cal. 2013). See cases citing Barker at - https://scholar.google.com/scholar?hl=en&as_sdt=20000006&q="Barker+v.+Am.+Mobil+Power+Corp."+"64+F.3d+1397"+"duty"+"investigate"+'"fiduciary"&btnG= AND THREATEN TO SUE AND ASK FOR LEGAL FEES

I should have specified that the distribution was a rollover to an IRA. So the prior distribution won't help.

@Bri Fantastic. How easy was that. Many thanks.

Only match money can be used to refund a match test failure, definitely don't swap sources. But hey, just count the amounts to refund out of his prior distribution.

Very best wishes Carol and good luck with your new "venture" which is like now giving back. You've joined Fred Reish's list of now 4 people who truly retired. Sal Tripodi, Sheldon Smith and (last but not least) Karen Jordan. Again have a wonderful life and thank you.

I have a plan where an HCE took an in-service distribution of most of his account and now needs to get an ADP/ACP refund. A little money was left in his deferral source, but it is not enough to cover the excess contribution refund amount. There is plenty of money in his match source to cover both the excess contribution and the excess aggregate contribution. He is fully vested in both sources. Does anybody know of any reason I can't just take the excess deferral correction amount from the match source?

Happy retirement! I know I have a printoff of yours at least 20 years and four jobs ago detailing which Code sections don't apply to government plans, it's been a fantastic resource to have!

They should pop up if you slowly type the start of a user's name here in the comment space. @fmsinc Yours came up first on the list after I typed the @ and the f - I was given a pop-up menu of several BL users to choose from.

Thanks! And you're right--a big reason I waited this long to retire was that I didn't want to do so until I had something satisfying to do on the other side.

can they not log in to a custodian or plan website and see balances?

Okay. How do you make those nice blue stickers with, for example, @artie m? Thanks, David

Congrats! Enjoy those new challenges - I think it is important to retire TO something rather than FROM something. Good luck!

Non-elective, yes, but for nondiscrimination I think you have a problem if the amendment benefited only or primarily HCEs.

The employer wanted a list of their own active and former participants with balances

for The Finway Group (Remote)View the full text of this job opportunity

ESOP Guy, your information aids my thinking; thank you. I advise plans, typically with tens of thousands of participants, for which a plan’s administrator does almost no work beyond instructing and overseeing the recordkeeper’s services. Because a recordkeeper wants no discretion, everything has to be specified as rules-based procedures, often so a computer-system record can apply the procedure, or at least signal beginning the procedure.

We do help our clients look for lost people who need an RMD as no one likes an uncashed check hanging on the books. We don't do it until very close to the RMD date or if the check really does go uncashed.

Thank you! And I'd love to have BenefitsLink take over that page. I've e-mailed you with information. Thanks, Bill! This is definitely bittersweet for me. I've been practicing employee benefits law for 46 years now, and maintaining my site for 28, and it's hard to walk away from all that. But I am 72, and it's time for a new chapter in my life. I've been accepted as a volunteer EMT trainee with a local fire department. That will be about a year of classes, practical training, and helping out the EMTs, after which I'll be certified as an EMT myself. Some questions have been raised as to whether I actually understand the meaning of "retire," which I hear is supposed to mean relaxing and playing golf or something. But I'm excited about the new challenges.

for DWC - The 401(k) Experts (Remote)View the full text of this job opportunity

Well, this would be a wonderful thing!

Hi Carol -- We'd love to have the database and create a page on BenefitsLink, with credit to you. Let me know how I can get it and make it easy for you. What is this retirement thing of which you speak? I thought it was only mythology 🙂 CONGRATULATIONS!