The questions that came up are with regard to a small, frozen, DB plan. There are terminated former employees who have elected not to receive their benefits yet. How often is the plan required to provide benefit statements, both automatically and on request?

It appears that under ERISA 105(a)(1), the automatic "every three year" EBS is required only for EMPLOYEES who are participants. It also appears that this requirement may be satisfied by proper notification, at least once per year, of the AVAILABILITY of an EBS.

But specifically with regard to a terminated participant, although it appears they must receive an annual funding notice, it does not appear that they must automatically receive an EBS. However, under ERISA 105,it appears that a participant or beneficiary may request, in writing, an EBS, and that they are entitled to only ONE per year under ERISA 105(b). Furthermore, under proposed regulation 2520.105-2©(2), it appears that IF the benefit information has not changed since the last statement furnished upon termination or break in service, no additional statement is required to be provided.

Agree/disagree?

Assuming you agree with the above, what is the required content, and IF a Plan Administrator agrees to provide a benefit calculation more than once per year, may the participant be charged for the extra calculation?

With regards to the charge, although 2520.104b-30 prohibits charges for disclosures REQUIRED under 105(a), since only one statement on request is REQUIRED, then I would conclude that charging the participant for any extra calculations would be permissible. Thoughts?

As to the content - I'm not sure on this. For example, if the plan permits lump sum, life annuity (normal form of benefit), Jt. & 100, 75, and 50%, must the mandatory annual statement furnished upon request provide payments under all these options? Under ERISA 105, it must provide "total benefits accrued." Under proposed regulation 2520.105-2(d)(5), it does not appear that the statement must provide the benefit amounts for alternative forms, but must contain a statement referencing this and referring them to the SPD. And must any extra statements provide them as well? As a practical matter, if you are going to charge the participant for the extra statement(s)m there shouldn't be a problem with providing the additional option payment amounts, but I don't know that it is required.

However, if a participant is actually electing to take a distribution, then clearly the distribution amounts under the various options must be provided.

I'd appreciate any thoughts or comments. Thanks!

P.S. - one final question: Suppose a participant comes in and says, "I want to take a distribution." So the Plan provides, at no charge, the various payments under the options available. Once having received this, the participant says, "I've changed my mind." How could this be handled? Could the Plan Administrator say, when the initial request is made, "There is no charge for you to receive quotes on the payment option for your distribution, but if you then decide not to take your distribution, we will bill you $250.00?" Alternative solutions?

Company wants to establish a 401(k) as they feel it would be cheaper and offer better investments. If the plan relinquishes control over existing annuity contracts, are the account balances of the contracts as of that date, perhaps the date of resolution to terminate, used for distribution reporting on the 5500? This is a small plan where all the contracts are easily identifiable.

Does the ACA require ANNUAL notification or just the first time a participant enrolls? The IRS brochure mentions that an EACA is similar to the ACA plan but has specific notice requirements. It does not specifically say that the ACA requires annual notification. Any confirmation is greatly appreciated!

I own and am the only employee (W2 pay) of a C Corp which administers a solo 401k of which I particape and which allows in-service withdrawals.

I will be turning 59 1/2 soon and would like to know my options and the forms I will need to file particular to the option(s) I act on.

I'm thinking of continuing to work for my company, but possible take a distribution from the 401k.

Can I move part of my 401k to my Traditional IRA while still working for the company? If so, what forms would I need to file and what would go on the W2 and where?

A plan requires that your deferral rate be at least 3%. (So, you can't defer 1or 2%) Is this ok or would it need testing? If testing is needed, I am assuming BRF, but how would that be run?

I have a client insisting he should be able to do a Roth Safe Harbor and make Safe Harbor POST-TAX contributions. I have explained that his plan is set up as a Roth 401(k) Plan and it has a Safe Harbor feature. He is taking advantage of the Roth Deferrals. I have explained that the government does not allow the employer to do Post Tax contributions. He now wants to see something in writing stating that employers cannot do post tax contributions. Any assistance or direction to the verbiage is greatly appreciated.

Thanks

My question is......Do Not for profit Government

entities such as a county or city government pay this fee??? County and or City Governments do not file....a Form 720, the Quarterly Federal Excise Tax Return

Paying Fee and Reporting Requirements

Insurance carriers and plan sponsors must file a Form 720, the Quarterly Federal Excise Tax Return, to report and pay the annual CER fees.

Hello,

I have a first year plan that started in 2012.

A profit sharing 401(k) plan fails the ADP test and the key employee must return $9,000 of deferrals.

When the plan is tested for top-heavy status as of 12/31/2012, taking into consideration the key employee's total salary deferrals, the plan is top heavy.

When the plan is tested for top-heavy status as of 12/31/2012, taking into consideration the key employee's salary deferrals reduced by the $9,000, the plan is not top heavy.

Can the top heavy test be based on the key employee's salary deferrals reduced to pass the ADP test?

Thank you

sue

In 2014 my household income is between 100% and 400% FPL

I know that if my employer offers me affordable self-only coverage and offers to cover my dependents and spouse (if I pay the entire additional premium) none of us can get a premium tax credit (subsidy) from the health insurance "marketplace"

But what if my employer does NOT offer to cover my dependents or spouse in 2014 (I know they will be coerced to offer dependent coverage in 2015), can my spouse and kids then get a marketplace subsidy?

I would think so but need reassurance from an expert.

Thanks

Company A, with a 401(k) plan, is about to acquire Company B, with a SIMPLE. I know that a company is not permitted to have both type plans in the same year. Is there some special rule in an acquisition situation where they were not related for the part of the year when both plans existed?

I have heard from multiple clients that they are being informed that grandfathered plans will have to comply with PPACA's no cost-sharing preventive care requirement starting 1/1/2014.

I am generally confident that is NOT the case and that grandfathered plans can theoretically keep that status indefinitely and therefore need not comply with this preventive care mandate.

Because I have heard this from more than a few clients, I do wonder if there is something that I am missing.

Can anyone help?

ok - I know this should be pretty basic, but am wondering what others think.

Since the 5500 SF form for 2012 has the signature on the first page now (yay) are you only attaching that page as the "manually signed 5500 attachment" for EFAST?

It seems logical to me that would be the case, but being in this industry over 20 years I have learned that logic does not always rule.

I couldn't find "current" 2012 form instructions on point on the EBSA website. The FAQs explanation is still the old one that says to scan and attached the first 2 pages.

The whole thing about attaching the first 2 pages always threw me but I rationalized that perhaps that was because the SF was signed on page 2. The 5500 has been a page 1 signature for as long as I can remember, though....SIGH

A calendar year 2013 plan will have a gain base for the current plan year if the employer elects to apply any of the 1/1/13 PFB to the 2013 funding requirement. The plan also has about $60,000 of COB at 1/1/13. The itch is that if no PFB is applied, the gain base won't be set up because the funded status will be 100% if assets are not reduced by PFB and the funding requirement is about $80,000. If PFB is applied then the funded status drops below 100% and the gain base gets set up and the funding requirement becomes $40,000.

Can the employer elect to apply all of the COB plus $1 of PFB so the result is the lower funding requirement? And is there any consequence of electing to apply credit balance in an amount in excess of the funding requirement?

Thanks for any and all responses.

Late deferrals for 2012 -- the amount involved was $56 and tax was $8. The deferrals were deposited by the end of the 2012 but lost earnings were not deposited until 2013.

On Form 5330 part I, line 3b, is an additional $56 tax due in addition to the $8? Is this applicable to the 2012 and/or 2013 filing?

We have client that overlooked payroll deduction of loan payments since 2011. We just discovered this with data rec'd for 2012 plan year. Technically, default occurred in 2011, but was only discovered this past month. We have calculated default (Princ + accrued interest), and participant wants to refinance loan for 5 year term as there are only 5 pay periods remaining on original term.

Q1) Any concerns with us writing 2nd loan for 5 year term to refinance default?

Q2) Watching a webcast from ASCi on EPCRS, an example presented of using VCP was "you want to not recognize a loan default in the year of default but actually in the year of correction." Does this mean we cannot just self-correct (SCP) but have to submit under VCP?

The ESOP statute requires an ESOP of a private companies to hold the Common Stock of the company with the best voting power and dividend rights.

Can a private company have an ESOP that holds Common Stock with the best voting power and dividend rights and also have preferred stock with better voting power and/or dividend rights than the Common Stock held by the ESOP?

Any cites to official or unoffical guidance are greatly appreciated.

Any comments are appreciated.

1) Participant took a loan from 401k plan 10 years ago, but plan did not allow for loans at that time (plan does allow for loans now). The participant has been making repayments the whole time.

** Since discovered now (2013), does the original loan amount (plus loan interest) become taxable to the participant in 2013 and considered a deemed distribution?

** Should the participant continue to repay the loan and if so, how is the repayment amount classified if the entire loan amount is taxable in 2013?

** Is this an VCP fixable violation?

** The loan repayments were established with a baloon payment, which is wrong. But since the loan should not have been allowed in the first place, what impact is there?

2) [Different participant, same plan] After a loan policy was adopted, the participant has taken 3 loans, all of which are still outstanding. Loan policy allows for only 1 loan at a time. All loan payments are current.

** Are the second and third loans an operation failure, considered to be deemed distribution and taxable now in 2013?

** Fixable through VCP?

Thanks

58 year old retired participant was receiving monthly pension payments. Then he accepts pension buyout lump-sum and rolls it to his IRA. CPA says he must do a 72(t) subequal on his IRA until attaining age 59 1/2 to avoid the 10% premature distirbution penalty on the prior pension distributions. Correct?

BACKGROUND:

We have a client (Co. A) with a 401(k) . A few years after the plan originated, Co. A purchased part ownership of another company (Co. B). Both are restaurants. Ownership interests in Co. B have changed several times in the past few years, but at all times prior to 2012, Co. A owned no more than 40% of Co. B so there was not a controlled group.

Effective 01/01/12, Co. A bought out other owners and became sole owner of Co. B, so effective January, 2012 we are dealing with a controlled group; however the employees continued on Co. B's payroll through April, 2012. Co. B never adopted Co. A's plan and although we haven't finished final testing for 2012, for argument's sake, let's assume the plan passes 410(b) even with everyone form Co. B excluded.

Co. B was then dissolved and all employees transferred to Co. A. effective 04/01/12 with a hire date of 04/01/12

QUESTIONS RE 401(k) PLAN:

1) Does Co. A have to give former Co. B employees eligibility credit for past service or can they consider them all hired on 04/01/12?

2) Does the answer to 1) above change if the employer instead recognized Co. B employees' original hire dates and seniority for other benefits?

3) If we have to give credit for prior service, some of the former Co. B employees would have entered the plan in 2012, but were never offered the opportunity to defer (since Co. A treated hire date as 04/01/12). How do we resolve this? (it's a large plan and many don't defer; although both HCE & NHCE ADP rates are less than 1%, some individual rates are as high as 10%)

So client purchased real estate had account at brokerage asked to send money for payment told 10 days he needed sooner, so he took money from corp account got payment from brokerage and put that into corp to replace payment corp made on behalf of plan. IRS says no good since thats a reversion I said reimbursement not reversion help or is he sunk?