We have just determined that our company's health plan only covers employees who work "full time," defined as 30 hours or more. For the past several years, we have included several employees in the plan, who have worked 20-25 hours. These employees were not, in fact, eligible to participate.

We are entering open enrollment now. We will have to tell these employees that they are "losing" their health coverage. Any thoughts on how to deal with them? They have to be kicked off the plan (I assume). They are not eligible for COBRA (I think? There was no "qualifying event.") They will ask, "What do I do now to get health insurance."

Any general thoughts would be appreciated.

Has anyone had experience with whether share accounting vs unitized accounting is a best practice for leveraged-ESOPs?

Given: Owner elected to receive RMD as 50% J&S . Owner is still working. Owner decides to retire 3 years later at 74.

Question: Can owner, at the time of retirement, elect to receive remaining benefits as Lump Sum?

Thanks for all responses.

Can my plan limit access to the Target Date Fund option that matches my age? Or do the 401(a)(4) benefits, rights and features avaialbility testing rules basically require that I can pick any option within the target date series (e.g., a 55 year old investing in the 35 year old option?

Is it allowable for an ESOP participant at age 70 1/2 to rollover their full ESOP distribution or a ESOP RMD to their personal IRA account? Thanks.

We are an RIA firm that also owns part of a TPA firm. The question is dealing with the John Hancock Forum IA (Installation Allowance) program.

We hired a prominent ERISA attorney for an opinion about the IA payments a TPA receives from John Hancock. We were told the IA payments must be 100% offset to the quoted fees if not, any fees above those must be credited back or reimbursed to the client... otherwise it is a prohibitive transaction becuase we are a RIA.

Another TPA firm were told a way to collect these fees without reimbusement because they had the same questions.

Not sure were to tunr. We cannot be the only RIA firm that owns a TPA that might be facing this. Just curious if there is anyone else facing this and have found any resolution or how they are handling the fee disclosure.

Is there a way we can obtain a private letter ruling or somehting in the same realm to hang our hats on?

Any suggestions would be greatly appreciated.

Any thoughts on how many signatures are required on an 8955 (we are not filing electronically for our clients.) IRS instructions just say sign and file, but the form has sponsor and administrator sections. We could use the 5500 theory and say admin only needed, but wouldn't it be nice if that was stated somewhere? Maybe it is?

How does one apply a negative rate of return to a late deposit? The plan is daily valued and the record keeper uses the participants actual rate of return to determine lost interest on a late deposit. The total lost interest is a ($500). So in this scenario, a salary deferral of $10,000 is withheld from pay but not deposited to the trust. When discovered, the deferral is now worth $9,500. If the employer deposits only $9,500, don't they benefit from the difference between the amount withheld from pay and the actual deposit? Is this permissible?

I've received one opinion that states under VFCP, the correction is made by applying the greater of the corporate underpayment rates for taxes under Code §6621 and not actual plan earnings and losses, unless the plan earnings are higher.

Thank you for any guidance!

A particular client has a 401(k) plan investment committee and is convinced that, if the plan investment committee identifies a particular fund as poor-performing, they should "freeze" that fund, and not let any "new money" into it. However, they think that this is a *safer* fiduciary bet than *removing* a fund that they have identified as poor-performing.

I take the opposite view. If, by their own process and investment policy statement, they've i.d. a fund as poor, but they then allow participants to stay in it, that strikes me as increasing their risk for participant claims if the thing tanks. There is written proof that they knew it wasn't performing! (I've seen the use of a hold and review list as standard - and if the fund stays down for a long enough time, it is removed).

Not much success reasoning with them on this point so far. (They believe - and there's something to this - that if they document their freeze process, and follow it, then the investment results don't matter). They are convinced (and I strongly disagree here) that in removing a fund, they face much higher risk than in just freezing it.

Any thoughts, examples, or insights from those of you who follow the participant fiduciary cases?

Thanks.

No response requested in regards to this very sad story

You were 55 in 2008

In 2009 you made 20 gazillion so you were an HCE in 2010

In 2010, you made 20 cents so you were not an HCE in 2011

You quit in 2011 and were given an offer to take a lump sum in 2011 and even though you were told that you might not be able to receive a lump sum distribution in a later year, you declined.

In 2012 you come back and say give me my lump sum now. The Plan says no because the Plan is only 90% funded, you are a former HCE, and the Plan sponsor doesn't want to fund up to 110%.

I have a plan that provides an early retirement reduction at 4.8% per year from age 62 to age 55, with no reduction at any age with 30 years of service.

For General Test purposes, should I incorporate future service in determining the most valuable accrual rate for an employee that does not yet have 30 years of service, but would attain 30 years before age 62?

For example, I have a participant age 50 with 25 years of service. Should his most valuable accrual rate be based on an age 55 benefit with no reduction (since he would have 30 years of service at this age), or the plan's regular 4.8% per year reduction (since he does not have the required service eligibility for unreduced benefits as of the testing date)?

I'm very new to Relius, so apologies for foolish questions.

So, let's say you have a 401(k) that wants to use the "maybe" election in 29(e)(2) of the adoption agreement. Then, in a timely fashion of course, they decide they do want to amend the plan to provide for the 3% safe harbor contribution. My question is this: does the amendment wording provide for something to the effect that "this amendment to provide the 3% safe harbor non-elective contribution is effective for the plan year beginning 1/1/2012 and ending on 12/31/2012. For 2013 the plan will automatically rever to the the Discretionary ("maybe") election in Section 29(e)(2) of the adoption agreement, and will remain so unless and until changed by any further amendment" - or something to that general effect. In other words, 1.401(k)-3(f)(1) clearly pwermits such an amendment to be for one plan year only. But does the Relius document permit this? If not, then it is a real bore to have to amend in and back out of safe harbor status year by year, rather than only having to amend in.

Thanks - I appreciate any responses.

A defined benefit plan is terminating and one of the retirees who elected a joint and survivor option would like to receive a lump sum now. When calculating the lump sum do you have to take into account the prior annuity payments that were made. I'm getting conflicting instructions. Also, can the lump sum be rolled over?

We have already amended several plans for PPA, but we recently discovered that we did not include the language regarding rollover to Roth IRAs. Is this language necessary? Will we have failed to properly amend the plans if we do not include it? Can we simply handle this by including Roth IRA rollover language in the plan's rollover documents?

i found out about husbands pension thru social scurity office when i applied for disability was denied but recieved a letter in the mail about ex husbands now decessed pension i was beificary to. got in contact with company and they need a death cirtifacate i provied that then thay asked for a QDRO and provided that. they told me they are gonna have there lawyer look and it send it to accounts department and i would recevie it two weeks later recevied a letter of denined letter said i have 60 days to appeal got a lawyer ex husband has two adult children this is my question do i have any rights i was told his adult children from previous marriage have all right over me his second wife he left no will but i was named beificary of his pension at the company were he named no one else and children were adults at time of marriage we were married more then 10 years please some advise

We have a terminated 403(b) plan with annuity options. A participant who is in the process of divorce cannot get her spouse to consent to a distribution. The distribution forms specifically state that spousal consent is required. The financial institution will not distribute without spousal consent.

What can be done in this situation? What are the rules?

Client sends me letter he received from the Bank, who is trustee of the pension plan. The Bank took the client and associate to lunch and the cover letter as well as 8 pages of 5500 crud address that the value of the lunch was $29 and change. The client, of course, has no idea what this is so ships it to me. I know what to do. I laugh. Not only have all the attendant costs of reporting now exceeded $29 (and change), but also the Plan has fewer than 100 participants (which the Bank would have known if they knew anything about the client or the Schedule C applicability), so Schedule C does not apply.

Fortunately for the client, he did not send this package to an advisor who would then bill him for reading the crud and responding to him. Ain't I nice?

We have an employee that we are trying to verify service credit for the 401(k) for a parent company.

From 1998 - 2006, he worked for a control group of the parent.

Anyone that transferred from that control group to our main company 401(k) did have their vesting and years of service "brought over".

He did not transfer. He terminated from the control group in 2006.

So, he never did transfer, he was terminated from the control group company. Then two years later the parent company hired him in 2007.

The parent company did not have his service on file, since he never transferred, but he was technically an employee of the company since 1998. He was in a separate 401(k) plan that he eventually was paid out from and had its own vesting and service (that would have carried over if he transferred, which he didn't).

Should his time with the control group count for the company? Or should it not, since he didn't transfer?

Thanks

My employer use a PEO for all of there insurance and payroll needs. As part of my benefits package, I am allotted a specific amount of money. I am allowed to use this money to pay the preimum on insurance, AFLAC products, ext. However I am not allowed to take it as cash. I am also allowed to use this money to fund my health saving account.

My issue with this is that my PEO only allows me to use the bank that they are set up with. I feel as if I should be able to use any bank I so desire. They are forcing me into using a bank that I do not want to use. Does any one have any thought on this

Kyle

Working on a Takeover plan, current document is written to include service with Predecessor Employer for elig/vesting/contribution. However they do not list any specific companies. Their intent to include service worked in that specific field no matter where it was.

We use the Sungard/Corbel document, any suggestions on how to write that into the plan?