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DB Plan without Trustees?


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14 hours ago, ERISAgeek111 said:

… I'm being told only 401k and 401a plans require trustees.  ...

As implied above, if you are referring to qualified plans, a 401(k) plan IS a 401(a) plan and a DB plan IS a 401(a) plan.

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

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While I don't suggest it's likely, among the remaining possibilities is one Lou S. suggested in the first response:  a plan with no asset beyond insurance contracts.

ERISA section 403(b)(1)-(2)  https://www.govinfo.gov/content/pkg/USCODE-2017-title29/html/USCODE-2017-title29-chap18-subchapI-subtitleB-part4-sec1103.htm

 

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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Lou S. and Fiduciary Guidance Counsel have won the prize on this one.  There are old insurance plans without loans which do not have trustees. ANY asset (loans) outside the insurance contract requires a trustee.  Would not surprise me if Mutual of America had issued some of these.

PNJ

Patricia Neal Jensen, JD

Vice President and Nonprofit Practice Leader

|Future Plan, an Ascensus Company

21031 Ventura Blvd., 12th Floor

Woodland Hills, CA 91364

E patricia.jensen@futureplan.com

P 949-325-6727

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On 1/29/2019 at 3:20 PM, ERISAgeek111 said:

Has anyone ever heard of a DB plan not having trustees? I'm being told only 401k and 401a plans require trustees.  Is that true? and if so, what is the authority for this?  Thanks

When someone "tells you" something that is questionable, you should be asking that person for the proof that it is true.  This is certainly NOT true, since assets of a plan are required to be held in trust or by an insurance company on behalf of the plan.  

Let's also note that a DB plan IS a 401(a) plan! Here is 401(a). Note the word "pension" in the first sentence.

(a)Requirements for qualification. A trust created or organized in the United States and forming part of a stock bonus, pension, or profit-sharing plan of an employer for the exclusive benefit of his employees or their beneficiaries shall constitute a qualified trust under this section—

And, how about this section 401(a)(5)(d):

(D)Integrated defined benefit plan.—

So, whoever made that statement is blowing smoke out of their rear! 

Lawrence C. Starr, FLMI, CLU, CEBS, CPC, ChFC, EA, ATA, QPFC
President
Qualified Plan Consultants, Inc.
46 Daggett Drive
West Springfield, MA 01089
413-736-2066
larrystarr@qpc-inc.com

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