JOH Posted December 11, 2020 Share Posted December 11, 2020 A recordkeeper is asking for approval from a TPA in order to process a Internal Roth Rollover. TPA is saying that it's not warranted b/c they view it similarly as an asset-reallocation. I disagree and view believe the TPA needs to provide the approval because IRRs are governed by the Plan, has reporting requirements, and tax implications while an asset-reallocation does not. Any thoughts? Link to comment Share on other sites More sharing options...
Bird Posted December 14, 2020 Share Posted December 14, 2020 Shrug. Sounds like a contractual issue to me. Ed Snyder Link to comment Share on other sites More sharing options...
Patricia Neal Jensen Posted December 14, 2020 Share Posted December 14, 2020 What does the Plan Document say? It either permits this or it does not. It is not a judgment call or something that requires "approval." 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 Link to comment Share on other sites More sharing options...
Gilmore Posted December 15, 2020 Share Posted December 15, 2020 Does the TPA normally provide approval for distributions for this plan? Bird and Patricia are both right. The IRR needs to be permitted by the Plan, and there should be some procedure for processing, which might include the TPA if that's how other transactions are handled. Link to comment Share on other sites More sharing options...
JOH Posted December 16, 2020 Author Share Posted December 16, 2020 I spoke with the TPA's Compliance Officer and he agreed that they should be providing the approval since they are approving the distribution. Thanks all. Link to comment Share on other sites More sharing options...
shERPA Posted December 16, 2020 Share Posted December 16, 2020 I'd be careful with terminology. Unless this TPA is taking on the role of a plan fiduciary in some capacity, the TPA doesn't "approve" distributions. A TPA would "confirm" that the requested distribution or IRR is permitted by the plan and that the participant is eligible for it. But a non-fiduciary TPA doesn't approve anything. Might seem to be a little thing, but us TPAs are obsessed with lots of little things. RatherBeGolfing 1 I carry stuff uphill for others who get all the glory. Link to comment Share on other sites More sharing options...
RatherBeGolfing Posted December 17, 2020 Share Posted December 17, 2020 52 minutes ago, shERPA said: I'd be careful with terminology. Unless this TPA is taking on the role of a plan fiduciary in some capacity, the TPA doesn't "approve" distributions. A TPA would "confirm" that the requested distribution or IRR is permitted by the plan and that the participant is eligible for it. But a non-fiduciary TPA doesn't approve anything. Might seem to be a little thing, but us TPAs are obsessed with lots of little things. Well said. Link to comment Share on other sites More sharing options...
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