I need a provider that will open an account for one participant and allow for an advisor. I'm hoping it will be under a custodial account arrangement...

small account ($3,500). the participant has no beneficiary or it appears next of kin. the plan says the account needs to be paid to the estate. does anyone know what the procedure is or have any experience with these payouts where there is no estate or next of kin to assist.

Member had COBRA with former employer, since 6/1/2010.

Effective 1/1/2011, from open enrollment period/rate chanes , Member dropped the dental plan and had a rate increase to medical plan.

However when Member went to pay via the on-line COBRA payment for 1/1/2011--the old premium was still on-line and not the updated rates.

This continued for 2/1,3/1,4/1,5/1,6/1--all COBRA premium letters still stated premium error from carrier.

On 5/27, a staff member from the insurance broker for this group contact member to advised the premium was being billed in error via phone.

8/1 and 9/1 premiums payments was parsed out to cover the back premium due(1/1/11-7/31/11) coverage was terminated effect 7/31/2011 & Member was sent a $92.75 refund check.

My coverage should still be in effect--the premium should never have been parsed for back amounts--YOU never advised me in writing of the error and under Federal law, you can only go back and fix the error from the quarter when the error was discovered hence 6/1/2011 at best.

The Member still was under the impression given the 81 and 9/1 payments were accepted that coverage was still in effect--they did not know coverage was terminated until the refund check was sent 9/21/11 and the Certificate of Prior Coverage was sent 9/22.

Should the Member have coverage re-instated and just be back billed only to 6/1/2011?

Should premium have been applied as far back as 1/1/11 with the 8/1 and 9/1 checks from Member without advising the Member?

What are the legal issues here?

Thanks

filling out paperwork for new plan as we speak. getting tons of conflicting info between broker dealer, provider etc.

plan: 401k safe harbor. one owner, one employee. have reqs. age 21, 1 yr, 1000 hours on plan.

the employee will reach his one year of service in early oct 2011. plan entry dates are jan/july 1. so next possible entry date for him is jan 1 2012.

plan starting now, all docs signed and dated today, will send notice to the employee, so we are within the 90 days.

must he get safe harbor contrib for 2011? some say yes since he's eligible, some say no since he's not yet entered into plan and the entry date matters also.

have googled it extensively but find no reference to entry dates....

Managament Co. provides management services to several restaurants. Trying to determine which companies should be part of a management group.

Management Co. Owned 100% by Person 1

Co. A Owned 85% by Person 1; 15% by Person 2

Co. B Owned 35% by Person 1; 35% by Person 2; 30% by Person 3

Co. C Owned 100% by Person 1's sibling

Co. D Owned 50% by Person 4 and 50% by Person 5

Co. E Owned 25% by Person 1 and 75% by Person 1's sibling (Different sibling from the Co. C owner)

Assume Management Co. derives 20% of its revenue from each co. If that assumption is correct then I think the Management Co., Co. A, Co. C and Co. E would be part of the group. I can include Co. A, Co. C and Co. E because siblings are family under §267.

I do not see that I could include Co. B or Co. D. Person 1 would need 50% onwership to bring Co. B into the group & Co. D's owners are unrelated.

Am I analyzing this correctly?

Thanks in advance for any guidance.

recently one of our clients was audited by the DOL and accused of getting its deferrals in to the plan in 12 calendar days. the labor department deemed 7 business days as reasonable. the client is a small employer. i am aware of the recent DOL safe harbor of 7 business days but this was released in 2010. as anyone been successful arguing for a few extra days for periods prior to the safe harbor being released?

I just talked to Relius support and they said the IRS has the testing part of the FIRE system turned off until November. so they are planning on releasing the version we want in January 2012. It will be the 2012 form 8955 SSA.

I have a client who has six employees. They do not offer health insurance because they are so small. Four of the six are covered by their spouse's plan. For the remaining two employees, they want to reimburse them for the health insurance premiums they are paying up to $100 a month.

Is this discriminatory? The other four are paying for insurance through their spouse's plan. One person at the client is arguing that anyone who can offer proof that they are paying for health insurance should get the reimbursement. Another only wants to pay the two who aren't covered by another policy.

Any suggestions where to find guidance on such matters? HR matters I guess.

THanks!

I must be missing something in the 408(b)(2) interim final regulations and hope someone can set me straight. Is a bank that is providing custodial services to a covered plan a "covered service provider" where it is paid either by the plan sponsor or from the custody account? The reg seems to provide that a custodian would be a CSP only if it receives "indirect compensation." Compensation paid out of the custodial account seem to be direct compensation [paid by the plan], and compensation paid by the plan sponsor is (oddly enough) neither direct, nor indirect compensation.

What am I missing?

I am a new HR employee for a plan sponsor whose retirement plans are in a "multi-vendor environment." There are three investment companies whose funds are available; one of them is designated as the master record-keeper but there are various logistical problems with that arrangement so there is no central source for the employer to obtain information. Vendor X's lifecycle fund family is designated as our QDIA--the actual default fund depends upon the participant's DOB.

Participants who make no election are placed in the Vendor X lifecycle fund, which is fine. However, I have discovered that some participants designate Vendor Y or Vendor Z as their investment provider of choice, but then do not proceed to name a fund. If the vendor receives a contribution from us with no investment instructions, it defaults into its own lifecycle funds, not the Vendor X fund that is designated as our official QDIA.

Does anyone besides me think that is a problem? It seems to me that we need to a) retrieve the money from Vendor Y or Z if there are no instructions and invest it with Vendor X, b) track down the participant to get a Vendor Y or Z fund designation, or c) add the Vendor Y and Z lifecycle funds as "official" QDIAs.

The answer to this question affects the content of our QDIA notice as well as who provides it. There has been some discussion of having the vendors provide the Notice, but is it fair to Vendors Y and Z to ask them to send out notices describing the Vendor X funds?

Any thoughts are welcome. Thanks!

A participant applied for a hardship withdrawal siting foreclosure/eviction. They provided a completed hardship application along with a foreclosure notice and a lease agreement. The participant signed a lease for a house. The landlord is behind on mortgage payments and now the house is being foreclosed on. Does this qualify as a hardship? To prevent your landlord from foreclosure?

I understand the thought process behind the request: "If the property is foreclosed on, then I'll be evicted" but it's not as though the participant is behind on rent and being evicted. Furthermore, the hardship application lists a different address than the leased property. The lease is month to month and the agreement was signed 8 months ago. For all I know the participant could have moved out.

Any thoughts?

A plan has several participants who in 2010 received taxable wages however deferrals were not with held from this pay.

1) Can the employer go back and with hold it and deposit it? Would this not involve amending those participants W-2's as well as calculating and paying excise taxes on what those deferrals would have earned.

2) Would a VCP filing have to be made?

Thank you

A professional sve employer has

8 active employees with an accrued benefit and

11 terminated vested employees with an accrued benefit

the plan has not had any accruals (not explicitly frozen, bit formula expired some years ago so no new accruals) for several years.

There are 19 additional employees who meet the plan's eligibility requirement, but of course have an accd ben of $0.

So the question is how many "active participants" are there?

Of course the PBGC premium filing instructions provide that a participant is someone that has a benefit liability (whether active or inactive).

So on that basis there would be 8 active participants and 11 inactive participants.

But is that the proper definition for "active participant" when determining number of active participants in order to determine if a plan is covered by pbgc.

Any comments supported with a cite of course

thanks

The DOL's FAQ on DFVCP does not make it very clear about mailing in a check and sending in a signed copy of the 5500, in lieu of online payment for late filing of a MP plan's 2008 and 2009 5500.

It appears I can still do it this way. The client mailed me a check for $1,500. Would I just send signed copies of the signed return, plus the check to:

DFVCP

P.O. Box 71361

Philadelphia, PA 19176-1361

I want to avoid having to return the check to the client. Thanks !

This question came up today from a DB plan sponsor of a plan that we audit (I am a CPA) and, while I am far from the most seasoned practitioner on this board, I was stumped. Any help would much appreciated.

Schedule R, Part III, Question 9 asks whether any amendments adopted during the plan year increased the value of benefits. The instructions indicate that the "increased" box should be checked if the amendment increased the value of benefits "in any way", and include in the examples "earlier eligibility for some benefits" and "more rapid vesting."

The HEART Act, among other things, requires 100% vesting in the case of death while performing qualified miliatry service. There are other provisions that can increase the value of benefits.

Does this mean that the "increased" box should be adopted in the case of all adopters of HEART Act amendments? Based on the instructions, I see no way around it. However, I have seen several Schedules R where this was not done.

Not sure if this post should be in the X-testing section, but.....I think it was determined in prior posts that 401(a) plans and 403(b) plans are tested separately for non-discrimination, at least when both are DC plans. We have an employer considering a soft freeze to their DB plan and allowing the new entrants to recieve an employer allocation in their 403(b) plan. Since both plans have uniform benfit/allocation formulas if they both pass the 70% coverage test all is good. But what happens when all is not good with the 70% coverage test in either plan?? If both were 401(a) plans we would move on to rate group and average benefit test where the EBARs would be combined. But in my circumstance with a 401(a) and 403(b) plan, would the EBARs still be combined for average benefits test?? Thanks.

401(k) has no exclusions on def. of comp. Trustee wants to amend to exclude bonuses then asked if the participants could be given the option to defer on bonuses if they wanted.

My guess is no as it would not be uniform and non-discriminatory

My question is as follows:

The instructions to Schedule A says that the insurance company is required to provide you will all the information necessary to complete the Schedule A. I reviewed the instructions and there is nothing about reporting premiums or benefits paid on the accrual or cash basis. If we audit the plan sponsor of a welfare plan, should we report the accrued claims to be paid at year end but not reported on the schedule A by the insurance company. I assume that the insurance company reports amounts on the cash basis.

Please advise.

Thank you,

Annette Leerhoff

I have an employee who previously terminated, reached age 70 1/2 and began receiving RMD's. They have since became a rehired employee. What are the rules now on the RMD requirements? Do they have to continue taking RMD's or can they waive them while employed? If they can waive them, how would this officially occur?

I have about 20 plans that are the old quarterly valuation plans. The Participants have the choice of 5 to 10 funds in the same family. They prefer this to the daily val platforms because of the lower cost. In the real world can anyone afford to set up the website that is going to be required under the new disclosure regs.

can anyone give me an estimate of what it would cost to add this to an employer's website?

Any ideas about this would be very welcome.