We have a plan where the sponsor now tells us that company 1 and 2 are not related, but they have been using a prototype and treated as a single employer plan. What are the consequences of not knowing a plan was an MEP - document becomes individuall designed until it gets restated onto a volume submitter, what about 5500's - I think an MEP files one but may have to identify they are an MEP?

The plan was safe harbor so ADP and ACP testing was not necessary.

any thoughts would be appreciated!

What guidance, if any, exists from the DOL/IRS or elsewhere on the consequences for failing to satisfy the bonding requirements under ERISA section 412?

I handle the employee benefit accounts in our Trust Department. I passed the ERPA exam this week, and I sent in my ERPA enrollment to the IRS. Once I receive my ERPA credentials, I will be eligible to recieve the ASPPA designation as a QPA too. I presume that the QPA designation is above the QKA designation since ASPPA requires additional course work beyond QKA to earn the QPA. My primary question is how do the various credentials compare with one another in terms of credibility? QPA vs. QKA vs APA vs APR vs CEBS? Are there any other comparable credentials? Which of them is recognized in the field as the most prestigious?

ok - Plan Sponsor moves plan assets from product with surrender charges. There are individual accounts. Sponsor wants to reimburse the surrender charges. Charges are not unreasonable but Sponsor wants to reimburse just the same. I know these have to be treated as Employer contributions not restorative payments.

Am I reading things correctly that Sponsor can amend the plan for a special formula for this allocation and then must test the allocation to be sure it is not discriminatory?

I did see a method described whereby the Employer "bonuses" each affected participant through payroll and then gives them the option to defer some or all (provided the Plan Doc allows). Are there any issues with this scenario?

I know that a covered entity can be a business associate of another covered entity. In that situation, what things do you consider when determining whether or not to require a business associate agreement from the covered entity with whom you do business?

We are having a bit of an issue. The model Corbel 457(b) basic plan document and its adoption agreement do not provide for disability retirement. Are we missing something or is that not an option under a governemental 457(b) plan? The employer wants to sponsor a new 457(b) and a new 401(a) plan so we are trying to mirror as many provisions as possible for ease of administration. Any thoughts appreciated!

Pension plan with 2 owner-participants.

They want to invest plan assets in a closely held corporation that they have personally invested in. Their personal investment is about 1.2% of this corporation.

Is this a PT? If so, what party in interest definitions apply?

I have a client, who has a non-spouse beneficiary who is also in the same 401k. The non-spouse beneficiary would like to rollover a portion of the decedent's account into an (Education Savings Account) ESA. Is this allowable? I cannot find anything on the IRS' website or in any regulatory briefs that talks about whether or not a 401k can be rolled over into an ESA.

Please provide the Code or Regulation where this is permitted or not permitted. Thanks

Suppose you have a brand new qualfiied plan effective 1-1-2011 (DB or DC, doesn't matter). The plan requires only 500 hours of service in the plan year to accrue a benefit (or to get an allocation). But the plan requires 1000 hours to get a year for vesting. Years before 1-1-2011 are excluded for vesting. Assume no other employer plan terminates within 5 years of 1-1-2011.

Suppose the 25% owner/HCE is now part-time, and has just turned 70 years old.

The plan has a 3-year cliff vesting schedule. Normal retirement is the later of 65 or the 5th anniversary of plan entry. Everyone employed as of 1-1-2011 is eligible 1-1-2011.

The NHCEs are all full time, but the HCE/owner wants to work these hours:

2011: 1500 hours

2012: 1100 hours

2013: 900 hours

2014: 950 hours

2015: 1100 hours

This allows the owner to accrue benefits (or get allocations) for all 5 years, but is not 100% vested at 3 years, but is 100% vested in their 5th year instead (that's NRD anyway).

Would the IRS think such a plan was intentionally designed to avoid the RMD rules for 2013 and 2014? To make it more worthwhile to consider, suppose it is a DB and the PVAB is $600,000 at the end of 2013 and goes up by about $200,000 in 2014. Could the IRS cause trouble for the plan sponsor and the HCE/owner? If so, what would they use for their basis?

Would you submit such a design for a D letter, and would that even protect them? Just theorizing/musing . . .

Somoene gets a QDRO of $100K. If they take $30K today, and $70K next year, are both payments exempt from the 10% penalty? Assume they do not rollover (of course). Someone is suggesting that the second distriubion is not exempt, but the code plainly says distibutions pursuant to a QDRO are exempt.

I know that SEP IRA's do not have to file 5500. Is there a cutoff regarding assets? If the the SEP has over $250,000 in assets would we then have to file a 5500 (similar to a dc plan with form EZ)?

May not be asking this correctly, but I will try. Because of the required amendment for age 62 in pension plans. Those defined benefit plans we have that have an age less than 62, we took the approach of many and that was to have an ERA of the age that we had been using and continuing to base the accrued benefit on that number as well as using it for funding.

With the DB restatements, our prototypes don't seem to cover the above. The master document uses the accrued benefit definition as ....to Normal retirement. That is now presenting us a problem for those plans we are restating with throwing it off the prototype.

How are others handling their docs?

The client's plan document provides that deferred vested participants will begin receiving their pensions on their normal retirement date, and no deferred starting dates are permitted by the plan. However, neither the client nor their TPA has any set procedure for notifying deferred vested participants that they're nearing their normal retirement date and should apply to start their benefits.

There are a number of DV participants in the plan who are between 65 and 85 and have never been contacted to start payment of their benefits. We are going to file a VCP application with regard to the over-70-1/2 participants, but I'm wondering whether the failure to notify the over-65 participants is also a failure that needs to be included in the VCP application? Is anyone familiar enough with plan administration to tell me what sort of process should have been followed with respect to these participants who were nearing/over age 65? For some reason, I'm having a difficult time finding any legally prescribed process.

Thanks in advance for any leads.

Situation: Plan YE = 6/30/11. Eligibility req = YOS. Entry Date - Single Entry 7/1. Participant was Terminated in 2002 and was 100% vested. Rehired on 11/15/10. Is she immediately eligible or does she need to re-meet eligibility requirements. Thanks in advance for your help.

I was looking for weekend pet boarding and was instantly distracted by this place's 401-K-9. I thought it was cute anyway!

http://www.campbowwowusa.com/pdfs/CBW%20In...9%20Program.pdf

Of course back when I was in corporate benefits, we'd have politely smiled and sent them away (or at least to the corporate communications department, which handled discount programs). The only "voluntary program" that I ever got behind was educational seminars about 529 plans (which ultimately, from the company's point of view, is just another direct deposit election).

(For anyone curious, 401(k)(9) proper says comp has the meaning given in 414(s) )

Is a required minimum distribution (RMD) from a traditional IRA permitted to be transferred to a personal Roth IRA? The IRS has a list of FAQs regarding RMDs and question 12 is "Can RMD amounts be rolled over into another tax-deferred account?" The answer is no. However, from my reading Roth IRAs are identified as a tax-exempt vehicle and not as a tax deferred account.

Any thoughts? If you can provide a particular tax code section that would be great.

Plan sponsor finally submitted "clean" data for 2008 adp testing. My assumption is that the adp test must be run without the use of testing the otherwise excludable employees separately.

I know that the otherwise excludable employees can be tested separately but can this testing method be applied after the 12 month correction period?

hello....

what is your opinion if someone is building their home, they own the property ( of course) the work is going to cost approx 30k and they have actual invoices for 10k, but have to have the 0ther 20k of services for the remainder of work.

how would you go about proving that.

also, does anyone have a hardship checklist that you can share

thanks so much!

An employee has a retirement plan in which he can make the maximum deferrals of $16,500. He also has another business and wants to set up a SIMPLE plan and deduct $11,500 for himself. Can a person do this or would he be limited to the $16,500 for 2011?

Somewhat unique situation for us where a 79 year old participant will have his lump sum benefit limited by the 415 salary limit, so we wanted to confirm our findings.

Male born 7/7/1931

Over 40 years of both Service and Participation.

AB of $12,699 payable as a 10 Year C&L at 12/1/2010.

AB at normal retirement date of 8/1/1996 (age 65) was $5,042 also payable as a 10 Year C&L.

Actuarial increases begin at 4/1 after attaining age 70-1/2 or 4/1/2003.

Plan Actuarial Equivalence is GAM83 and 7%.

High 3-Year Average Salary is $160,521.

Plan provides QPSA without charge.

Single Employer Plan that has about 400 participants.

Plan offers SLA at both Annuity Start Date and Normal Retirement.

We determined his annual 415 dollar limit to be $433,721 and his annual 415 compensation limit to be $160,521, both payable as Single Life Annuities. Based on that, his lump sum limited by IRC Section 415 would be about $1,075,350, which seemed slightly low. Do the above results seem reasonable?

Thanks in advance.