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You are not going to get answers you can depend on here. You need to work with the attorneys to figure out what is going on. I should also point out that attorneys that require the two spouses to sign the QDRO are making requirements that are not in the law. ONLY if the judge mandates that (and some have done so) should it be included. The law does not require participant agreement; only that the order properly reflects the judges decision, whether the participants agree or not. A participant saying "I'm not going to sign that thing" should never defeat the ability to have a valid QDRO approved by the court and executed by the plan.

I agree with your recommendation. Again, have the employer ASK if the employee wants the extra $500 taken out, and if so, INCREASE the deduction for the one payroll by $500 (with the appropriate employee election). Now there is no issue; revert back to only $500 per payroll after the one check for $1000.

1. Get Mirco$oft's HR to give you a copy of the QDRO procedures (they should have sent you one already). 2. Like others said, it could be that MS decided not to qualify the order for some reason. If that is the case, they must let you know the reason. There are a lot of things a DRO must include and things it cannot include before the MS Plan Administrator qualifies the order to make it a true QDRO. Divorce attorneys and judges all have different expertise levels when it comes to DROs, so yours may be deficient in some manner and the parties involved have no idea. 3. Like someone mentioned, a company usually has up to 18 months to qualify (or disqualify) a DRO. (It's an absurd amount of time, I know, but I think the rules go back many years where determining what exactly the ex-spouse would get was more difficult) 4. I agree that your attorney (or another attorney who is well-versed in QDROs may have to get involved.

Vlad401k, you will notice that the 1099-R instructions are (still) very cryptic regarding Code 3. They really only reference the disability standard involved, not when you use Code 3. My guess is that you are supposed to use it only if the distribution event is disability, e.g. in a DB plan with an actual disability benefit (as opposed to a benefit, e.g. in a DC plan, which is permissible because of the participant's termination on account of disability). Presumably, you are trying to get the disability exception to pre-59-1/2 for having a qualified distribution for Roth and no 72(t) premature distribution tax (which would only apply if you didn't have a qualified distribution). Note that the last bullet in the instructions for Code 2 is inclusive of 72(t)(2)(A)(iii). I would probably go with 2B.

I think Mike Preston gave the best answers already, but I'm open to the idea that it wouldn't be arbitrary and capricious to interpret the plan has requiring the $500 to be taken from the bonus amount too if that's what ends up happening.

Yes.

Thanks, Larry. I appreciate and understand your positions and do not think it fair to others to hijack this thread to debate here so I'll just say I stand by my prior comments, however unartfully crafted they may be, and continue to believe (hope) that the spirit of the laws and programs passed by Congress matter and can eventually come to bear on the interpretation of those laws when questions arise as continues to happen with these issues.

The SH is required and must be made. The due date for 2018 was 12/31/19 and I believe that you can self-correct before the end of the next year. I'm not sure what the interest rate is but it has nothing to do with market results - actually I'm not sure if they specify the rate to use but I think I remember using the late deposits rate. As far as PS, that is an optional contribution and is too late for crediting to 2018 for any/all purposes. You can say the contribution "was" X but if not made in a timely manner then it "wasn't."

In this case, the employer should NOT approve it. HOWEVER, he can ask that the participant re-examine his situation, give him a CRD form that shows the conditions (as of now) that is necessary, and then asks the participant to self-certify. The employee was an idiot to disclose this non-eligible situation AT THAT TIME, but he can certainly have a change in his situation that now would qualify him. And again, all he has to do is self-certify. Understand?

I probably shouldn't say anything but I keep seeing this or similar questions come up and it really bothers me given everything that is going on. While I agree the current rules would seem to permit this and also agree the likelihood of significant enforcement is pretty limited, I respectfully think it's a stretch to say that it is clearly within the spirit of the program. Afterall, the name of the program is Payroll Protection and the rules place a clear emphasis on protecting payroll rather than new and never previously received retirement benefits. Matching contributions tied to ongoing payroll during the covered period or prorated contributions toward existing plans I can better see but taking significant excess amounts (whose very existences seems to raise questions under the way i understand the program amounts to be calculated) and creating a new plan is, I think, a real stretch. Just because the rules might be read to permit it doesn't mean employers should do it nor does it mean professionals should advise employers to do this even if the risk of enforcement is low. I have friends who have lost their jobs and most if not all income during the last couple of months. I realize one employer not maxing out their PPP spend doesn't do anything to help others directly but in the bigger scheme of things I think it important to take a broader societal view and would not be surprised if regulators do not come at these questions from that perspective as well even if unlikely to really audit.

IRS Q&A #11 may be relevant: https://www.irs.gov/newsroom/coronavirus-related-relief-for-retirement-plans-and-iras-questions-and-answers

I would just remind them that retirement plans must be intended to be permanent (and not a shelter for a one-time windfall), and contributions to a profit sharing plan must be substantial and recurring. As long as they are ok with making some other contributions in some future years it should be fine.

Thank you Dave!

Mr. Peabody and his pet boy Sherman would be proud.

Congratulations! Very happy that y'all have lasted and succeeded.

I'll second Dave's comment. I was extremely fortunate to have an outstanding mentor, who was generous with his time and expertise above and beyond the call of duty. I doubt that I'd have stayed in this business if it weren't for him.

To the group: I'm retiring this year after 46 years in the business and want to thank you for the knowledge your daily newsletters have imparted to me. I have read your daily newsletters since day 1 and, as part of my mentoring program, encourage my juniors to read it as well. To another 25 years!!! Gary Rothy

My father went to Rennselaer but back in the 40s! And he did not become a snowboard instructor...