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    QDRO for Alimony

    Jack Stevenson
    By Jack Stevenson,

    Can you draft a QDRO for Alimony payments?

    Submitting to the Court

    Eric Hanford
    By Eric Hanford,

    If there are two retirement plans to be divided, should you submit both Domestic Relation Orders to the Court at the same if the other spouse refuses to sign.

    Seeking Acquisition Opportunities for Small to Mid-Size 401(k) TPA Firm

    John Smith
    By John Smith,


    I have a client interested in acquiring or merging with a small to mid-size 401(k) TPA firm. Their services include, but are not limited to, plan designing, plan valuation, preparing renewal packages, census scrubbing, contribution calculation (including profit sharing), and compliance testing (Coverage, ADP/ACP, 416 top-heavy tests, 401(a)(4), and top-heavy). They are open to opportunities in any location.

    If you know of any firms available for acquisition or merger, please send me a direct message.

    Best regards,


    Does this cross-tested plan pass??

    Santo Gold
    By Santo Gold,

    This 401k plan uses for a PS allocation individual groups - one group per participant.

    The plan has 3 HCEs and 1 NHCE.  The desired allocation is for the owner to hit his 415 max (he makes $330,000).  But, he wants to give a lot to the others.

    It just so happens that the owners PS contribution rate is 9.03%.  The other 2 HCEs and the NHCE is 28.83%.

    The plan passes the non-discriminatory classification test and the average benefits test, but only on a contribution basis, not on an equivalent benefit basis.  401(a)(4) rate group passes as well.

    Because of the plan's allocation method in the document, do we have to pass the average benefits test using the equivalent benefit basis, or can we rely on the contribution rate passing, even though this is a cross-tested plan?


    Thank you 


    Employer contribution paid on time but not allocated timely

    By Tom,

    Employer contribution for 2022 of about $9,000 was paid in Sept 2023 in time for tax deduction purposes.  The plan is a dreaded separate brokerage account for each person, granted a small plan.  Despite us providing the participant allocation of the money to the broker (more than once - the brokerage firm had personnel changes) they did not implement the allocation so the funds sat in an unallocated account until just now.  The broker is asking about makeup earnings. While that seems to be the right thing to do, I'm not certain it is required. It is likely a fiduciary issue. It's just another thing to do, explain to the client, he will ask who should pay (I'm guessing it could be $1,000), and it won't be us but we'll have to go round and round and take a lot of time and we will want to bill for the time.  I'd like to ignore it. 


    Excluding service prior to adoption of the plan for vetsing

    By Tom,

    Plan sponsor has had  401(k) plan in which a participant is 100% in profit sharing.  He wants to adopt a DB plan for 2023 and the employee terminated in 2024. Can years of service be prior to DB adoption be excluded for DB vesting?  The plan document says service for vesting must be recognized for a "predecessor" plan.  Does predecessor include K plan or only a prior DB plan?

    Thank you

    412e3 - RMD

    By Jakyasar,


    As I never came across one (nor dealt with 412e3 plans for over 10 years), how does one calculate RMD’s?


    COBRA Deferred Loss of Coverage

    By EBECatty,

    I'm curious about others' experience with the deferred loss of coverage rules under COBRA and how most people measure the coverage period.

    For a simple example, an employee terminates employment on May 2, 2024. By the terms of the fully insured policy, coverages ends on May 31, 2024. In my experience, most plan sponsors would continue "active" coverage through May 31, then send a COBRA notice stating that they are eligible for COBRA starting on June 1, 2024 (and ending 18 months from June 1 and not from May 2).

    As I read the regulations, the COBRA rules default to an 18-month period based on the date of the qualifying event (here, termination) even if the loss of coverage occurs on a later date. However, the regulations allow plans to measure the 18-month COBRA period based on the date of the loss of coverage following the qualifying event.

    A quick skim of most available wrap plan documents and policies either don't squarely address the issue or simply state that participants are eligible for COBRA based on a qualifying event without additional clarity (maybe by design).

    In practice, though, I have found that starting a full 18-month COBRA period on the day after the loss of coverage (June 1, in the example above) is far more prevalent, whether intentionally following the regulation or just out of routine. 

    Am I wrong?

    "Pending" cause of death prevents distribution to death beneficiary

    By Flyboyjohn,

    Participant dies while alone and with trauma to head evidently caused by falling on coffee table.

    Participant has history of drug abuse and police confiscate her phone presumably to search for drug dealer?

    Her body is cremated, and Death Certificate indicates cause of death "Pending". Indications from authorities are the cause of death may never be known. 

    Plan Administrator refuses to pay plan benefits to surviving spouse death beneficiary until cause of death is determined, presumably out of concern that a state "slayer" statute may not be preempted by ERISA and might preclude payment to her slayer.

    Wondering if anyone has encountered this situation or has a suggestion of how to deal with the impasse.

    Many thanks for any suggestions.

    overfunded match contributions

    By pmacduff,

    Small 401(k) plan with 13 participants. match formula in plan doc is 50% up to 4%.  match was set up in payroll incorrectly for some participants who received 100% up to 2%.  owner is asking if he can leave the excess match in the participant accounts for those who received too much.   (There were 2 participants shorted match that are going to be trued up and 4 that were matched properly.  7 received excess match.  all participants who received excess match are NHCEs.)


    Loan refinance on 10 year home loan

    By Belgarath,

    I'm finding one aspect of this a bit confusing, and I've been chasing my tail a bit.

    Original loan to purchase a home had a 10 year term. 6 years has gone by, and participant now wants to refinance, (plan doesn't allow multiple loans, and won't be amended to allow multiple loans) taking out additional cash, NOT to purchase the home. The question is - is the loan amortization period eligible for 5 years without falling afoul of the "double counting" - or, must the amortization period end no later than the end of the original 10-year period - that is, over the remaining 4 years?  I incline toward the latter...

    DB Plan Mandatory Cashouts

    By Hojo,

    I believe I know the answer to this, but a trust provider is telling me differently.

    In a PBGC plan termination we have a number of participants whose LS value is less than $500.  Is it possible to open and IRA for those participants since they are considered force-outs?

    I thought the answer was no and you had to submit them through the missing participants program....am I wrong?

    QACA 2-6 year graded vesting

    By Sarah73,

    I can't find any info online indicate a QACA plan allows 2-6 yr graded vesting. But I do remember I saw this design many years ago. Am I wrong?

    Employee w/ loan becomes Union EE--default the loan?

    By BG5150,

    Plan excludes Union employees.

    January 2022, non-union employee, Tim, takes $10,000 loan for 5 years.

    May 2024 Tim becomes union employee and is now in an excluded class in the plan.

    What happens to the loan?

    Single Life DB Plan and Estate Planning

    By DanyelN,

    We have a single life DB plan that is at the 415 limit and is over-funded by roughly $500,000.  She is nearing retirement (in a year or maybe 2) and is trying to sort out her estate planning. 

    The plan is currently set up with her husband as the beneficiary of her plan.  We are trying to determine what happens if they both pass before the assets in the plan have all been paid out. 

    Also in question is if lump sum is taken how are surplus assets taxed? Plan provision pays only plan participants. Would this be a deemed “employer reversion” subject to 20% to 50% excise tax?

    411 accrual limits to 415(b) max benefits

    By DanEA,

    A newly formed Cash Balance Plan has in the first year a 415(b) accrual limit of $275,000 x (1/10) = $27,500.  In the second year the 415(b) accrual limit is $275,000 x (2/10) = $55,000 which is double (assuming no 415(b) $lim increase.  Does the 133 1/3 accrual rule limit the second year accrual  to 133 1/3 times the first year accrual?

    notifying PBGC

    By erisageek1978,

    Is plan administrator required to notify PBGC upon realizing that plan cannot be terminated using standard termination, because it is underfunded and will be filing for bankruptcy.  Client is going out of business and we've been in talks with PBGC and on track to do a standard termination (per PBGC's suggestion and also because it was possible we could fund the plan), but now we know we will be underfunded.  Do we have to let PBGC know that we know for certain now we're underfunded? Proposed termination date is 7/31.  

    Schedule R participants with only receivables

    Pat Crum
    By Pat Crum,

    In completing Schedule R, are participants who have taken a distribution of their total invested account balance reported if they still have a receivable at the end of the year?  That is, if the participant's account balance is only a receivable are they considered fully paid out?

    gateway test when def/SH & PS have diff elig requirements

    By Aca,

    deferral and SH have 1 YOS requirement, and PSC has 2 YOS. a participant is eligible for deferral/SHNEC but ineligible for PSC. should he be included in gateway test and get gateway minimum as he is benefiting SHNEC (an ER contrib)? thanks!

    Final Form 5500 Report

    By 5500Nerd,

    We are facing a debate: for a final Form 5500 report there is agreement that on page two of the Form 5500 the end of the Plan year participant count is left as zero. However, some have a covered persons count with those enrolled at the end of the Plan year on a Schedule A. Others have said that this is incorrect;  the Schedule A also is to list zero. Can anyone settle the debate? 

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