Does anyone have any experience reporting multiple top hat plans electronically under the DVFC program?

The DOL Q&A's allow a single filing for multiple top hat plans, but the calculator prompts for a single plan name and does not appear to contemplate multiple plans. By "continuing" I am concerned that I will not have the opportunity to add the other plans. Has anyone advanced to the next screen and can tell me otherwise? Because the submission is coded 888 or 999, it's already identifiable as a top hat submission, so I'm wondering whether it's okay to just list a generic name, such as "Deferred Compensation Plans" or something to that effect.

Defined benefit plan, first plan year was 2009. S-corporation, a single 100% owner, not "professional" and at the time of plan installation, they had one employee who accrued a benefit, so the administrator listed them as PBGC covered and paid PBGC premiums. Apparently, did the same for 2010 and I don't know about 2011. The employee terminated as zero per cent vested in 2009, and under the terms of the plan, his benefit was immediately deemed distributed/forfeited.

Fast forward to 2011. Ignoring other aspects such as permanency and whether PBGC premiums were paid in error, he wants to terminate the plan. Is it subject to PBGC? I don't see how, but I've also never happened to see this, and wondered if anyone had an opinion? I'd say no - I can't see any reason why you can't flop back out of Title IV if you satisfy the exception.

Have a standard 401k plan whereby a trustee is asking for the availabilty to purchase an equity membership in a golf course with his participant allocations.

How do I shoot this down or accomodate?

What are some of the pitfalls?

We're looking for a secondary tax advisory provider. We're currently using EBIA. Can anyone recommend a 2nd, 3rd choice, etc.?

Looking for some guidance. Company A is acquiring Company B - deal to close mid-December. On January 1, employees of both companies will be on the same benefit plans. However, for the last 2 weeks in December there will be 2 sets of employee benefits - therefore employees, potentially in the same class, will be eligible for different benefits. Is there some grace period after an acquisition where Company A has time to get all employees on the same plans or does it have to be in place the day the deal closes? Thanks

I am very confused. I have researched thisand cannot find an answer.

1. Can an greater than 2% shareholder in an s corporation participate in a HRA account?

If not is it treated the same way as accident and health insurance prem. Add to box 1 as taxable income not subject to FICA and Med. and then it is taken as an AGI deduction on the 1040.

2. Same question exception can the shareholder have a Health Savings Account.

A terminated participant received a total distribution of his balance in a 401(k) plan. The amount distributed was over $5,000. Subsequently, he received an additional contribution of less than $200 due to a match true-up. For his second distribution, which will be in the same taxable year as the first, is he required to receive a rollover option due to the amount of his original balance?

Hello, all,

I'm drafting/designing a 409A-compliance plan for an LLC. Under the Plan, participants will be granted the option to buy service-recipient stock at a future date (for date of grant FMV).

While the equity option design *should* satisfy the exemption from 409A, company/client wants to comply with 409A for a long list of business reasons, including the risk of inadvertant loss of the exemption (i.e. by an unintentional modification or extension).

(I'm generally treating the 'stock right' rules under 409A as analogous to the LLC setting based on IRS Notice 2005-1, Q&A 7 and the Final Regs Preamble Section III(G)).

Under the Plan,

-Each grant will specify a vesting date; and

- (change in control will accelerate vesting).

Here's where I've hit a conceptual stumbling block:

I am thinking (given the 409A 'permitted payment' concept,) that all vested equity units must be *exercised* (and included in income) in a single block (or, alternately, in sub-blocks, if different exercise dates are pre-assisgned, such as: "you may exercise 50% of units in Year A and 50% in Year B").

Client, of course, wants increased flexibility, and wants me to report back that the following would by OK:

1. once vested, participant may choose how many units to exercise when (i.e. participant could *decide* to exercise [and be taxed on] 30% [or other participant-elected percentage] in whatever year he or she chooses prior to the end of the exercise period.); or

2. If specifed exercise dates must be used, client hopes that the choice, *not* to exercise in a specified year would be permissible if such choice results in a forfeiture of the right to exercise those units [ever]).

Other than as described the BNA "Section 409A Handbook" on p. 425, below, I don't see how the client can have the flexibility under point 1. (Unless, of course, they abandon the idea of complying with 409A and just use the exemption).

As to point 2, I'm inclined to think that might work, but without any actual identified authority to rely on.

On point 1, the BNA "Section 409A Handbook" (which is great), provides the following on p. 425:

(Emphasis added).

Question 1: I'm just looking for a reality check to confirm that I'm not crazy, and that under 409A, the units must be either: (i) exercised only upon the pre-specified date/year (and that the participant can't just decide not to exercise them in a specified year [as least notwhile retaining the right to exercise those in a future year]); or (ii) the options may be exercised at any time [and I gather that income would accrue], but receipt of the actual equity would be delayed until the speicifed payment event. Thoughts??

Question 2: Anyone ever seen a 409A option plan under which, if participant doesn't exercise upon a specified date, the right to exercise is forfeited??

1 man plan with life insurance. After 9 years the employer is hiring some employees. He, being a generous soul, does not want to buy life insurance for his employees. He wants to amend the plan so that no future life insurance is purchased (before the new employees become eligible). Just on the face of it this seems discriminatory to me because there will be a benefit available to HCE's only. I can't see anyway to justify this. However, I promised I would inquire.

Anyone think that this is possible?

Thank you in advance.

Small top heavy plan has about $1,000 unallocated funds in trust which has been tracked to earnings on a 2003 profit sharing deposit that were not allocated along with the contribution. Plan sponsor cannot locate report from that year. Can this amount be allocated this year as 1) among current active participants as a forfeiture? or 2) as earnings to all remaining participants who were in the plan in 2003, based on current account balance, or 3) as earnings to all current participants, even if hired after 2003?

I would be very curious to know how other employers handle this? What is our obligation to educate employees on their annual max amounts into 401(k), 457(b) plans? Where is the line between personal advisor and employer administering a benefit?

Is there a line that could be crossed when educating employees on what their deferrals should be etc.....

Thank you

Two questions here:

1 - Can I do 2009 and 2010 on separate 2009 Forms? Does it matter if I combine them all on 1 form or do both separately?

2 - For Relius users - I have Plan Sponsor and Plan Admin info populated in the Plan Info worksheet so when I open the SSA everything rolls into the form. The IRS instructions state to put "SAME" on the 8955 SSA form for the Plan Admin info if the info is the same as the Plan Sponsor. Does it really matter if I populate both sections? I cannot edit the form so I would need to go to my Plan Info worksheet, erase all of the plan Admin data, write in SAME, and carry over to the SSA. Trivial I know but just trying to see if I can avoid doing that for 100 plans.

Thanks in advance for the input.

are there any statutory amendments that need to be adopted before 12/31/2011 or shortly thereafter any one knows of?

of course plans need to be restated by 4/30/12.

thanks

A defined benefit plan pays benefits to a surviving spouse in the form of a lump sum distribution only if the amount is under $5,000. There is no other form of benefit available to beneficiaries...this is mandatory. Can the lump sum form be eliminated under 411?

Death benefits are ancillary benefits, unless they are part of an optional form of benefit and I see no reason why this wouldn't be an optional form of benefit under the regulations. Any thoughts?

The 408(b)(2) regulations require service providers to disclose detailed information about plan fees and compensation to plan sponsors. In general, plan sponsors must evaluate the fee and compensation information received from the plan’s service providers and determine that the services and fees are necessary and reasonable. In a 403(b) plan that permits participants to make salary deferrals only to one of 7 approved vendors and the participant can direct in any investment option offered by the vendor, what is the sponsor’s obligation to monitor the fees and expenses of each vendor? What must be disclosed to the sponsor by each vendor? What should the participant fee and investment disclosure information look like?

Plan sponsor adopted plan in 2005. Did not report all employees to TPA, did not fully deposit all deferrals. Plan went top heavy in 2008, sponsor has not contributed TH minimums to date. TPA finally gets all the information, revises ADP tests, calculates VCP correction amounts, TH amounts, delinquent deferrals, with earnings, etc. Total tab to correct under VCP is about $100K. Sponsor refuses to make corrections and directs TPA to terminate the plan.

TPA chose to resign because:

1. it won't knowingly prepare an incorrect 5500, and without restoring plan assets, the 5500 cannot be zeroed out.

2. 1099-Rs and distribution paperwork that represents distributions to be eligible for rollover when the plan is known

to be out of compliance would be incorrect.

3 participants have a claim to benefits under the terms of the plan, TPA doesn't want to be associated with this.

Individual (who is an ERPA) who made the decision to resign is getting push back from various parties, but cannot see any way to help the client terminate the plan without some reasonable efforts made to correct known defects.

What, if anything, can a circular 230 practitioner do for this client to get the plan terminated?

Hi all,

We're being told by Datair that 2011 Interim Amendments are "highly recommended" for cash balance plans written on their document, and that they need to be adopted by 12/31/11. Does this ring true?

For those using Datair or other types of CB docs: Are you rolling out interim amendments to be signed by 12/31/11?

TIA.

Scott

An HCE's lump sum is restricted and the partiicpants ends up taking a rollover into an escrow IRA (i.e. an areement that if the plan terminates down the line without sifficient assets, they could dip into the IRA and take some money back). What if a year after the escrow IRA is set up the Plan passes the 110% test. Are all the restrictions lifted on the escrow IRA and it no longer has a potential liability to the plan?

I can't find anything written that states as of what date the allocation group classifications are made. The plan document simply names the groups. If the document has two allocation groups; Owners and All Others, and a participant is an owner part of the year but isn't at the end of the year, which allocation group is he in when it's time to allocate the contribution?

Does anyone have an opinion or legal authority related to the ability of a governmental DB plan to transition to a private DB plan? Apart from PPA funding issues, etc. A private plan was switched to a governmental plan for a variety of reasons, one of which was to avoid PPA funding; however, now the facts may change such that it will no longer qualify as a governmental plan under the IRS/DOL/PBGC tests for such. The goal is to avoid freezing or terminating the plan if possible. We know there are funding issues to address if the change can be made. Thank you in advance.