I am the Alternate Payee/former spouse in this matter and am looking for general feedback from anyone familiar with QDROs, 403(b) retirement plans, TIAA orders, or similar experiences involving defective DRO/QDRO drafts.

After waiting approximately six months for a TIAA 403(b) DRO draft, I finally received one from counsel’s office, and it contained serious errors. This was not simply a completed TIAA template form; it appeared to be a separate/custom DRO draft prepared by counsel’s office that used some TIAA model language in places, including standard provisions addressing beneficiary/death issues.

The draft definitively reversed the Participant and Alternate Payee designations in the order. The identifying addendum also contained incorrect personal information on both parties. The office made several attempts to correct only the addendum, but the addendum still was not fully correct. The DRO draft itself has not been substantively revised or reissued after 15 business days.

The draft did not identify the specific two employer plans, plan numbers, TIAA contract numbers, CREF contract/account, or Other Investments, even though the TIAA template appears to require plan identification. The draft also did not address the participant’s separate-property baseline in one TIAA Traditional RA contract, even though counsel has been aware of that issue for well over a year. The percentage-award language was vague and did not clearly distinguish the community-property interest from the participant’s separate-property portion. It also omitted pro-rata/exclusion language for the TIAA Traditional RA contracts, including language needed to apply the percentage award correctly while excluding the separate-property baseline and preserving the applicable RA allocation/interest-crediting characteristics to the extent administered by TIAA. The draft also did not clearly state the sequence for a separate CREF-only award after the percentage division.

After I sent a detailed written list of corrections, the office partially corrected only the addendum, but no corrected DRO draft, call, status update, or substantive response has been provided after approximately fifteen business days. Staff indicated the draft had been reviewed by counsel before it was sent to me.

For those familiar with QDRO/DRO drafting, TIAA/403(b) administration, or similar experiences, is this type of delay and lack of communication after serious draft defects are reported normal in the QDRO process? What is a reasonable professional expectation for follow-up after a client identifies material errors in a draft DRO?

We had an inquiry today about a "cash distribution profit sharing plan that is in compliance with 29 CFR Part 549".  Researching this, we found a lot of info that implied that it's a normal PSP, but even the TPAs we work with didn't know exactly what this was.  Does anybody know what this and how it may differ from a traditional qualified 401(a) PSP?  All assistance is appreciated.     

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Our client's plan terminated and all accounts have been distributed except one.  Upon employment, the participant provided an incorrect SSN.  The participant has been unable to provide a valid SSN and is not expected to do so.  Unfortunately, the employer is a small business and failed to obtain I-9 verification.  The account balance is approx. $2500 and is all attributable to employer safe harbor contributions.  He satisfied the eligibility requirements and the funds belong to him, but a distribution cannot be processed using the invalid number, nor can an IRA be established.  I am looking for suggestions on how to handle the remaining funds.

Very small TPA firm - a SOC Report has been requested. I'm curious if other small TPA firms have audits or documentation of their processes/systems prepared for them?

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Just was informed that the client made 300k of db contributions in all kinds of different stocks held by the corporation rather than cash.

This is the first time I am dealing with this and any guidance on how to correct it is appreciated. 

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A client is looking to hire a top tier employee.  The prospect has a counter offer.  Plan eligibility is a problem.  The competitor has immediate entry while my client has a 1 year service requirement.  I was asked, can we change the eligibility to get this one new hire into the plan immediately and then change it back?   And if technically it is ok do we have to wait a certain amount of time before we tweak the eligibility requirement again?  I totally understand, if anyone else is hired during that time gets to enter based on the existing plan design. 

Is this playing games with eligibility frowned upon? 

Hello -

My understanding is that if an employer finds ineligible dependents enrolled in health insurance plans as a result of an audit, the employer is not obligated to offer COBRA to those that are removed from coverage. Can the employer choose to extend COBRA to these folks or is that not permissible or creates other compliance issues.

A participating employer has chosen withdraw from participation of the PEP and terminate their plan.  The employees with cease contribution and their assets will be moved to their own SEP plan.  The SEP plan will be terminating immediately.  

Question:  How is final testing completed?  From the PEP or from the SEP?  Short Plan year?  

Any thoughts would be appreciated.

A participant deferred too much in 2026 and exceeded the 402(g) limit.

We calculated the earnings on the excess and will distribute the excess plus/minus earnings.

Which code should be used for this distribution? Should it be code 8?

How will this affect their taxes for 2026? Since the participant will be limited by the 402(g) limit on the tax return, would he be double taxed if he also reports the excess distribution (using code 8)?

Thanks!

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A participant is still actively employed but the recordkeeper shows a termination date from approximately two years ago. The participant says the date corresponds to moving from part-time to full-time, not an actual termination.

The plan’s call-center instructions direct the participant to his manager rather than the plan. The manager does not know how to correct the record. The recordkeeper’s service team says the plan must submit a new file before the participant can establish deferrals.

For those familiar with payroll/recordkeeper administration:

1. What record would typically correct this—a rehire transaction, employment-status correction, or full eligibility-file update?
2. Which sponsor-side function usually owns it: payroll, HRIS, benefits, or the TPA?
3. Is this normally corrected through the next regular feed or through an ad hoc correction file?
4. Are there controls that identify active employees coded as terminated, or are these usually found only when the employee tries to enroll?
5. What is the normal escalation path when the employee’s manager cannot identify the appropriate benefits or payroll contact?

I am trying to better understand the upstream administrative process because my role generally sees only the participant-facing result.

The situation:

• 401(k) plan participant executes an ambiguous beneficiary designation.  Account balance is $100,000
• Participant has two surviving brothers.  The beneficiary designation is unclear as to whether one brother receives all $100,000 or whether each brother receives $50,000.
• Employer asks:
  • What is the risk to the plan/employer if a distribution is made? (Obvious to me -- Potential litigation)
  • Does either brother have a right at this point to request and review/examine the beneficiary designation?
  • Can the employer refuse to provide the beneficiary designation to the brother(s) until requested during discovery (if there is litigation)?

Highly self-sufficient employer (i.e., reluctant to hire outside counsel) wants to know its options at this point.

• Make a distribution to one brother and hope everything works out?
• Make a distribution to both brothers equally and hope everything works out?
• Is there anything the employer can do to decrease the risk of one or both brothers initiating litigation?
  • Provide the brothers with the beneficiary designation form, ask if they're OK with splitting 50/50, and have both brothers execute an indemnification/settlement agreement before making the distributions?
  • Can the employer somehow use the ERISA claims procedures to its advantage here?
  • File an interpleader action with the court?

Is there anything else the employer should be thinking/doing to resolve this matter in the least expensive way possible?

Thanks for your thoughts.

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Recordkeeper for ERISA covered 403b plan of tax exempt entity offering "automated" RMD processing including participant communication and automatic payout of RMD if no action taken by participant by certain date.  Recordkeeper also advising that plan can "waive" spousal consent for RMDs.  I have been unable to find any authority for this.  Anyone else have experience with this?

As an ERPA, I am representing a client with a SHNE 401(k), no PS.

The auditor is looking for a SHNE 30 day notice.

I believe the notice is no longer needed, the audit is for 2023.

Does anyone have a cite for this?

Suppose you have a profit sharing plan that covers 15 participants and has for over 10 years.

They would like to add a 401(k) provision 8/1/2026 and make the plan Safe Harbor NEC for 2026.

I would think that since the profit sharing plan has been active since before 1/1/2026, the overall 415 limit for the 401(k) profit sharing plan would be $72,000 for 2026. 

Question: all participants will be under age 50. Since all participants will only be able to start funding salary deferrals on 8/1/2026, must the salary deferral limit be limited to 5/12ths of $24,500 or $10,208? Or could they fund the entire $24,500? And I would think salary deferrals, the 3% SNEC and Profit Sharing contributions to the participant would be based on full year compensation and subject to the overall $72,000 415 limit.

Does anyone see this differently?

Thanks.