Is an HRA similar to a FSA? Where do I get a document? I am assuming that a Form 5500 has to be filed. Is that correct?

Our client received a child support enforcement levy letter from the State against a former employee's vested balance in the Plan. Balance has not yet been paid out.

Should the client refer this back to the participant to obtain a DRO or does the State have the authority for this request without a DRO?

The levy references "section 5232(a) of the Civil Practice Law and Rules" & the client is in NYS.

The client will consult their attorney, however I'm curious what others have done in practice in these matters.

any input appreciated.

So far in 2011, we inadvertantly used the wrong salary number (base versus gross) when withholding from employees' paychecks for 403(b) elective deferrals, with the result that elective deferral contributions were understated. We need to correct this by contributing the correct amount to the plan provider, preferably in 2011. How do we handle getting the additional contributions from the employees? There is not enough payroll remaining in 2011 to catch up and still leave the emplyees with enough money to live on. Are we stuck with our company making the contribution in 2011 and withholding the money in 2012 to make the company whole. Would that mean the employees' W-2 is higher in 2011 than it should have been, and in 2012 lower than it should be?

Thanks,

Ken

Facts: Audited 401k plan pays fees out of the plan (including audit fee)

Source 2 - 401k

Source 3 - Match

Source 5 - Rollovers (unrelated)

Current plan count is 200 participants with $1MM in assets

The plan has approximately 10 participants that would like to roll money into the. Assume each rollover is $100k. About an additional $1MM could be added to the plan. They are hesitant to roll the money into the plan because the rollover would increase their share of the plan fee. The rollover alone is 5% of the total plan balance. That doesn't take into account any other fee they may have (ie mutual fund expense, etc). It would be cheaper to keep in an IRA. However they like the protection of the 401k plan (and keeping all their eggs in one basket)

Questions:

1 -Can we choose which "sources" plan fees are deducted from? Can we say or choose plan fees will not be deducted from rollover sources?

2 - Can we say only participants that contribute 401k and receive match share in the plan fees?

I believe there is an advisory opinion out there (or some other authority) somewhere wherein the DOL (or other governmental entity) indicated that it is okay for a selling entity to continue the former employee's in its plan for a short period of time (realizing that it might take time to get the seller's employees in the buyer's plan) after the transaction, but I am having a difficult time finding it - any help would be appreciated! Thanks

I believe there is an advisory opinion out there (or some other authority) somewhere wherein the DOL (or other governmental entity) indicated that it is okay for a selling entity to continue the former employee's in its plan for a short period of time (realizing that it might take time to get the seller's employees in the buyer's plan) after the transaction, but I am having a difficult time finding it - any help would be appreciated! Thanks

What kind of disclosures need to be provided for whole life insurance policies? I've not been able to find anything concrete. Thanks.

Hi...

I am not exactly where to find this in the regs. When running an ABT test, can you use the net amounts after the NDT failure? In other words, plans fail the ADP/ACP test and make ROES, can I use this reduce contribution amount when running the test?

Thanks for you help...

Two questions:

1- If a client was previously filing a full 5500 (had other plan participants), but now the only participant is the owner, therefore filing a 5500-EZ, is still necessary to reverse this participant?

2- Participant reported in 2000, paid out in 2001. Since it was volunatary to reverse the participants back then, is it necessary now to reverse this participant 10 years later? If so, how far back do we go?

Any help or guidance would be greatly appreciated.

Thank you.

DPSRich

Dear All,

DOL regulatuions and case law have held that owner-only retirement plans are unprotected by ERISA outside bankruptcy proceedings.

Is this still the case?

Many thanks!

A small DB plan was frozen 3 years ago. The plan had provided 3% of pay per year of service. The company now wants to unfreeze the plan and simply restore the 3% pay for each year of service (including the years the plan was frozen). Is this considered a benefit increase to an HCE and therefore cannot be part of the cushion amount?

An employment law forum referred me here as my question involves the interaction between employer provided group health insurance and Medicare, and may also be impacted by changes either now in effect or coming into effect from implementation of PPACA.

The question originates from the HR department; they haven't had this issue previously and want to get it right. I don't want to rely on info from insurance broker and there's no internal ERISA/Medicare or tax expertise to ask.

Fact: Employer pays 100% of employee group health premium cost. (I know, this not a common employer practice these days.)

Query: Employee is eligible for Medicare (65+) and inquires if he voluntarily comes off employer group health plan and elects Medicare as primary insurance, is there anything preventing the employer from paying both his Part B Premiums and Supplemental Insurance in lieu of firm paid group health insurance? (Doing so would cost the employer less than the group plan.) Would this still be a tax free benefit or additional taxable income? Is there anything in ERISA, Medicare or tax law/rules (or state law, although I suspect Federal controls this issue) that addresses this? Impact, in any, of PPACA?

Your thoughts/comments are appreciated. (As I'm dealing with lawyers, any cites or websites with authoritative info would be helpful.)

We are slightly under 80% funding. A disabled employee (who is very ill and near death) did not apply for the disability pension under our DB plan within the one year period required. The plan requires eligiblity for SS disability as a criteria for elig for the disability pensio which is immediate no redcution. Social Security Admin had just determined his eligibility ; it took them more than a year.

This 1 year provision is indeed soemthing new to me. The Admin Committtee has recommended amending this out of the plan. However our actuary is saying that this is an increase in plan benefits since we are slightly under the 80% funding and we advised us to contribute the Present Value of his disability pension. I am also running by ERISA counsel who has not gotten back to me yet.

I wanted to get others opinions on this.

We are not increasing the disability benefit. Seems like a catch 22 that to be eligible for the disability pension you must be eligible for SS disability. Since this took the SS Administration over a year to determine this guy's eligiiblity , one would think this strange concept of applying within a year to get the disability pension be amended out withut compromise funding of the plan?

Any suggestion on how to maybe do this w/o triggering an increase in benefits?

Much thanks

Alexa

Is a HRA similar to a FSA? Where do I get a document? I am assuming that a Form 5500 has to be filed. Is that correct?

A small company (15 employees) has all union employees (all CBA). The CBA provised retirement benefits for all individuals through a larger, multi-ER plan. This includes the 2 owners, who are also in the union and participate in this union plan.

Can the owners still establish a separate retirement plan for themselves? If they craft the eligible class of employees to exclude all CBA employees, except for owners, that would work in the document. In fact, since they are owners and not really employees, we could probably leave it as simply excluding all CBA employees.

But would this work in reality? Since the rank and file can be statutorily excluded, can we play mix and match to bring make the 2 owners eligible and not have to worry that we are not bringing in any of the rank and file?

Thanks

Participant with low compensation makes a large salary deferral and is entitled to safe harbor match. The plan is also cross-tested, and the participant is entitled to a gateway contribution, but because of the large deferral, hits his 415 limit before all of the gateway contribution can be allocated.

For example:

Comp = $10,000

Deferral = $9,000

SH Match = $400

7.5% Gateway = $750

Only $600 of the gateway contribution can be allocated before hitting the 415 limit.

How do these requirements interact with each other?

My former employer terminated the 401k plan and sent me a check for the balance of my funds. The funds were sent from the 401k plan, to my former employer, and then they made a check out to me for my balance.

Will i be responsible for penalties/taxes on this? Kinda freaked out

this report is intended to pull the info for min distribution due by 12/31/2011 (or 4/1/2012)

under report writer you would run the report from 1/1/2010 - 12/31/2010

and select All Plans.

I ran it first thing in the morning before anyone else was on the system, took around 1/2 hour to pull the data from every plan. (A single report for each plan that has a possible min distrib)

It doesn't do DB, though it will pull cash balance, but I doubt the amounts it pulls would be correct. That is a side effect.

I have a few new takeovers, since its the first year on the system (2011) I ran the report on those plans from 1/1/2011 - 1/1/2011 just to pull the begin bal (which of course = the 12/31/2010) and that worked fine as well.

as with any report it's a use at own risk, though I did compare the results to what Relius would pull. this report doesn't pull people with 0 balance like Relius, etc. but otherwise it did pull the same people, so it appears to be working.

this report is actually a modifed version of the crystal report for 70 1/2, but it pulls more than the balance, it calculates the min distrib, so its sort of a combo between the crystal report and rthe standard report.

what I don't like about the min distrib report from Relius (the standard report from Processing/Plan Maintence) is

it will not necessaerily pull correct balances and I'm too lazy to go through each and every plan to run the following (per their instructions):

The Set Trade Date Fields process (Processing/Balance Update/Set Trade Date Fields) is one way to update the beginning balance trade date fields in the Acctbal table. This process can only be run on a plan basis. It cannot be run for a single employee, or for more than one plan/plan year at a time. To figure out which plan year you would need to run this process for, to get correct balances for a particular plan/distribution year, see other FAQs under "70½..." topic.

This report is hardcoded to take 12/31/2011 - DOB, so it is designed for 2011 only

Is there a Participant Statement requirement for those Participants who are entered as a Code D on a 2009 8955 – SSA Form?

Has anyone seen any quidance on which participants are required to be reported on the Form 8955-SSA for 403(b) plans? Should I report

A) 2008 and later terminations

B) 2005 and later terminations

C) All terminated participants with vested balances, as they have not been reported yet?

Thanks for any responses.