When someone takes a hardship withdrawal and the plan has other related plans at the current trustee and recordkeeper, should the participant be suspended from making contributions to the other plans at that recordkeeper/trustee? What if one of the other plans is a nonqualified plan?

Does anybody know, previously encountered a similar situation or care to hazzard a guess as to whether a 401(k) Plan participant's spouse's father (i.e., the participant's father-in-law) qualifies as a "parent" for purposes of a "safe-harbor condition" hardship witrhdrawal for payment of funeral expenses?

Thanks for any and all input/comments.

Client would like to adopt a new 401(k) plan to be effective 1/1/11. Ideal plan design for them is safe harbor. Is it too late to adopt a safe harbor plan for 2011?

Thanks

a dutch dual citizen has appx $100K in his plan overseas. He now resides in the states and is wanting to establish a plan for his sole prop. company here and avoid taxes. I did a search on foreign plans on this thread and did not come up with anything. My guess is that any U.S. DB/DC plan would NOT accept rollovers from other countries unless perhaps if they were a U.S. owned company.

Any suggestions?

Thanks

We have a Cash Balance Plan that ceased to be covered as of May 2010 (all participants were terminated and paid out except the owner, and the plan did not terminate). At the time, the plan sponsor sent a letter to the PBGC explaining it was no longer covered and why. The PBGC sent a letter in response agreeing, and memorializing the actual date at which the plan ceased to be covered. We in turn filed an amended 2010 filing, requesting a pro-rated refund because the plan had paid a premium for the entire year of 2010. The refund in question is approximately $400.

After the amended filing was submitted, the PBGC first sent a letter saying the plan was not eligible for a refund. The plan sponsor wrote another response letter explaining the situation and re-requesting the refund. The PBGC then called the plan sponsor and informed him that they refund, or allow pro-ration of, premiums in only two circumstances: plan termination; or, change of plan year--creating a short year. They also claimed the instructions clarify this. I read the 2011 PBGC premium filing instructions and could not find this explained anywhere.

Anyone know of any backup for their position?

Given: Profit Sharing Plan. Current employees are Owner Husband and Wife. No other employee.

However, the parents of the husband worked before but terminated years ago. Account balance of parents are still in the trust account.

Question: Is this a one-participant plan? Is this an SF or EZ filing?

Thanks for all responses.

When completing Part III Line 9, column (g) for a DC plan, as of what date do you report the total value of the account? Let's say I'm completing a 2009 Form 8955-SSA for a calendar year plan and reporting a participant that terminated during 2008. Should we report this participant's 12/31/2008 vested balance, or current vested balance, or? Or does it matter?

Any thoughts would be greatly appreciated.

Thanks!

ABC is an S Corp, but employee X owns no stock of ABC. X receives W-2 wages from ABC.

X is an 8% owner of MNO, an LLC (i.e., partnership for tax purposes). Due to MNO being 85% owned by the person who is also the 100% owner of ABC, MNO and ABC are a 'control group.'

Does X's 8% ownership of MNO (which renders him a self-employed person, not a C/L employee of MNO) render X to be a self-employed person as to all of the MNO-ABC control group, and not eligible to participate in the MNO-ABC cafeteria plan?

Or, may X participate in that cafeteria plan since X is a C/L employee of ABC? If so, what special concerns might apply to X's participation in that cafeteria plan, apart from just considering X's W-2 wages from ABC for purposes of elective reductions, etc.?

A deferred compensation plan subject to 409A is amended to change the definition of eligible employee. As a result, some participants are no longer eligible to participate in the plan. Are the unvested compensation amounts deferred under the plan by these participants forfeited as a result of the amendment?

Notice to interested parties must go to all employed participants, all who could become participants and all who are employed in the same location. For a frozen DB plan, the only people in the plan are individuals with accrued benefits.

Are they considered participants?

I have a law firm that has a 3% non-elective safe harbor contribution. Sometimes they have shareholders that are underwater on their annual draw and would like to be able to elect to receive or not receive the 3% safe harbor on an annual basis. Interested to know if anyone has designed a document that has received IRS approval or any other interesting suggestions. Thanks

The attached article (http://www.retirementtownhall.com/?p=2420) was provided through benefits link. It suggests that since interest rates are low, it may make sense to borrow to contribute to the pension plan to reduce the PBGC variable rate premiums.

The PBGC variable rate premium is 9/10 of 1% of the unfunded vested benefits. So, if you can borrow say on an interest-bearing note to pay down the unfunded vested benefits, then PBGC premiums are reduced. But, there is a cost to borrowing, and so long as the rate at which you borrow exceeds 9/10 of 1%, there is added cost to this approach unless you're in a nonexistent 100% tax bracket. Worse, would be if interest rates soar. In such case, (a) the unfunded vested benefits -- all things being equal -- will reduce anyway, (b) you will have to pay even a higher interest rate on borrowed money, and © you can't withdraw the money from the pension plan to pay down the loan.

Is there some advantage that I may have overlooked?

Why_Pay_PBGC_Premiums.pdf

If I take over a December year end plan today (November), can I change to "each in own" from "salary ratio" for this year?

All the participants have met the 500 hours requirement but does that entitle them to the allocation method when they met the 500 hrs requirement or just an allocation?

Thanks

Happy Thanksgiving to All!

Owner and wife are only Plan Participants in a D.B. Plan. Son enters the Plan as an owner with more than 5% voting stock. No contributions to Plan as Plan is overfunded. Owner is 89 and is receiving his Required Minimum Distribution(RMD). Owner dies and spouse continuing to receive her husband's RMD as well as her own. Wife (age 92) dies in February 2011 and son as the named beneficiary of each (mother and father) receives both RMD's.

Question: Are both R.M.D.'s reportable on Form 8955 SSA? Actuary says no.

Any thoughts.

Thank you.

DPS Rich[/size]

I'm thankful for BenefitsLink Message Boards and all who post here.

Just want to make sure that I have this straight. We have a client that ended up not depositing the minimum required contribution by the 8 1/2 month funding deadline, therefore incurring a deficiency. The tax itself is reported using Form 5330. At the time that the 5330 is ordinarily due (7 months after plan year end), we of course did not file for an extension on the 5330 as we had no expectation that we would need to file (funding deadline had not even come when the 5330 is due).

Just want to make sure that i understand the logic: We filed 5330 after the triggering event occurred 8 1/2 months after PYE when the client missed the funding deadline, so off the bat the form is late. So not only owe the 10% excise tax, but also get followup late filing penalties because we didn't extend the form. Or am I missing something?

I have a client that maintains two Plans: 401(k) Plan and a Profit Sharing Plan.

The client would like to allow for in-service distributions but wants to limit the distribution to ONLY rollovers into the 401(k) Plan. There would be no other restrictions on in-service distributions (i.e., age). Could I amend the PS Plan to allow for this?

Facts: Employer sponsors 2 plans (1) a 401(k) plan and, (2) a Davis-Bacon Pension plan. The Employer pays all plan fees except the initial participant loan fee for the 401(k) plan. The Davis-Bacon plan pays all fees/expenses for itself. The Employer wants to merge the two plans.

Question: Once the two plans are merged into one, can the Davis-Bacon plan "source" contine to pay all plan fees and expenses relative to its participants? In other words, the Employer wants the original plan fee payment arrangement to continue just as if the plans were still two separate entities - ER pays for 401(k) plan "source" (EE deferrals only - no P/S or Match), and the Davis-Bacon plan "source" pays all of its fees and expenses.

I've not seen this situation before. I'm not seeing anything at the DOL site that specifically addresses this issue. Anyone have any clues?

Thanks in advance.

I'm hoping someone can help me understand my HSA. I really don't understand it, and people explain it to me in a language I don't understand.

I'm 29. I have a 3000/6000 plan. My employer does not pay or give any benefits. I have my own HSA, through my own insurance guy. I have had for about 2.5 years now. I don't make enough to contribute, never contributed (or know how to contribute). I pay about $60/month for it out of pocket.

Here's my question. I generally don't go to the doctor (actually have never needed or gone since 1997 because I don't get sick or cut off any limbs! I recently hurt my back splitting firewood at home, and had to go to an orthopedic surgeon. Luckily I don't need surgery, but I am going through 4 weeks of physical therapy. On the explanation of benefits it says my $3000 has not been met and $0 has been met towards my deductible, my insurance will pay 100%, and I have 0% responsibility, and my co pay is $0. That sounds contradictory to me, like I have to pay a $3000 deductible to get free physical therapy?!? I don't understand.

I really don't understand my insurance, it's like they aren't paying anything. Could someone please explain for someone who doesn't understand? Any help is greatly appreciated!!

This article from McKay Hochman seems to suggest that an FAB takes the p[osition that delinquent employER contriubtions would constitute a PT. I had always that this outcome was limited to multi-employer plans. If a company is on the brink of bankruptcy and cannot fund the safe harebor it committed to, is this a PT? Assume the owner is not taking a paycheck, or is taking "living expenses" only.

http://www.mhco.com/Library/Articles/2011/...rib_111811.html