I have a client who is/was a 50 – 50 shareholder in a corporation. The corporation went into receivership and has completely withdrawn from the Central States Southeast and Southwest Areas Pension Fund. The pension fund has previously sent 4219(a) information requests to the receiver, requesting information about the company, but now the pension fund is requesting personal information from my client, including a request for copies of his personal income tax returns.

I don’t do much work with multiemployer plans, but can a shareholder be compelled to respond and provide this type of personal information under ERISA 4219(a)? Any assistance would be appreciated. Thank you.

7/1/10 AFTAP is 85%, no 2011 certification so at 10/1/11 the 2011 presumed AFTAP is 75%, 50% restrictions apply. Prior to October 30, 2011 AFTAP is certified to at least 80%. Must the 436 participant notice still be provided?? Thanks.

The ABC Plan has a participant contributing to the plan who lives in Puerto Rico. (The client does not have a Puerto Rico plan). The PR resident has contributed $16,500 year to date. The client contacted me to determine if this participant should only have contributed the maximum based on the Puerto Rico limits or if the participant can contribute the 402g limit. The plan document does not address this or exclude this participant from eligibility.

I have two questions:

1) Does the plan need to be dually qualified to let a resident of Puerto Rico contribute?

2) If he can contribute, is he subject to the PR limits?

We're terminating a 401(k), everyone has been paid out except 1 guy with about $2,000 in the plan. We've talked to the guy, sent him election forms on numerous occassions, and had the business owner call him, but he won't budge. The Plan Document does not include provisions for force outs. We want to file a Final 5500 but cannot until we get this huy paid out. What can we do?

Thank You!

I own a small business.( S corporation)

I have 25 employees. 1/2 of the employees have medicaid or a goverment health plan.

I want to cover only the employees that do not have any health coverage?.

1. Can I have a health insurance plan that covers employees under the age of 65. If they are 65 or older they have medicaid.

Would this be discrimantory?

2. Can I have a cafeteria plan for my employees if my business is an S corporation?

Hello everyone!

A client has a deferred compensation plan with grandfathered benefits. There are no haircut provisions in the plan. A participant in the plan has a lump sum deferral due to him on January 1, 2014 (his fixed retirement date), that he wants to accelerate to 2012, the year in which certain other deferrals are set to begin paying out in installments.

As it stands, I don't see any way that this acceleration would be permissible. A formal amendment allowing haircuts would be a material modification for 409A and would lose grandfathered status for the benefits.

However, what if the client just gave the participant a lump sum payment in 2012 with a 10-20 percent haircut? Is this allowed? Do we run afoul of 409A? If anyone can assist or perhaps point me to any IRS position on this subject, I would greatly appreciate it.

Thank you!

Hello everyone!

A client has a deferred compensation plan with grandfathered benefits. There are no haircut provisions in the plan. A participant in the plan has a lump sum deferral due to him on January 1, 2014 (his fixed retirement date), that he wants to accelerate to 2012, the year in which certain other deferrals are set to begin paying out in installments.

As it stands, I don't see any way that this acceleration would be permissible. A formal amendment allowing haircuts would be a material modification for 409A and would lose grandfathered status for the benefits.

However, what if the client just gave the participant a lump sum payment in 2012 with a 10-20 percent haircut? Is this allowed? Do we run afoul of 409A? If anyone can assist or perhaps point me to any IRS position on this subject, I would greatly appreciate it.

Thank you!

Plan A has a June 30 year-end. On December 31st, Plan A is merged into Plan B which has a December 31st year-end. All of the existing participant accounts in Plan A are transferred to Plan B.

Assuming that Plan B's testing for the year ended December 31st will not include the newly-added participants from Plan A, is non-discrimination testing for Plan A required for the six months ended December 31st?

And, if possible can you provide me with a citation to support your answer?

We have had E & O insurance for almost 20 years and have never had a claim. Hopefully we never will.

Isn't E & O insurance to cover damages resulting from an error and/or omission? The biggest exposure for a TPA firm is a plan disqualification as the result of a mistake. Is that not what it is for?

In reading our current policy and the prior policy, the exclusions section seems to exclude coverage for damages resulting in any way from penalties initiated by the IRS.

Just wondering if anyone else has run into this.

Thanks.

I would love to see two new sections. What labeled something like "Disclosures Covered Service Providers under 408(b)(2)

and the other" Participant Fee disclosures under 404(a)

I am trying to put down on paper how to implement these and it ain't easy!

If the distribution, QDRO, and loan fees are the only fees charged to Participant, am I correct in thinking that I should:

1. Send that page of the SPD annually?

2. Send statement showing other fees actually charged quarterly?

3. When account is closed, the Participant does not currently get a "final" statement showing an ending balance = 0. Do I have to start sending this "zero balance" statement showing fee?

Effective July 15, 2011, as part of New York's new hire reporting requirements, New York employers must report whether health insurance benefits are available to dependents, and if so the date the employee qualifies for benefits. Multi-state employers may continue reporting to their designated state as long as such reporting includes New York's required information.

While the new law allows for multi-state employers to continue reporting to their designated state, I am finding that states are not modifying their reporting format to accomodate this new information.

My question: How are other multi-state employers reporting this information?

One solution that I have is for multi-state employers to report information for New York employees directly to New York using its on-line reporting system.

Any comments or suggestions are much appreciated.

Independent consulting agreement (subject to 409A e.g., independent contractor does not meet any exclusion requirements) provides for a monthly compensation amount to be paid on the fist day of each month during the 10-year term of the agreement.

Even though the agreement creates an enforceable right to compensation paid in a later year (and does not subject the compensation to any substantial risk of forfeiture) does not the "payable on the first of the month" requirement put the arrangement within the short term deferral rule?

Same example as above, however the compensation amount is increased by $25,000 per year, payable monthly, provided certain company-wide annual sales goals are met. Agreement is silent on when it is determined that the sales goals are determined to have been satisfied each year. Under these provisions, short term deferral rule is not met.

Any comments, rebuttals or thoughts appreciated.

Here's a good one...

Small employer adopted a profit sharing plan (on profit sharing prototype document) over a decade ago. It has since been amended and restated on profit sharing prototype.

The problem is that from inception, the plan has been operated as a profit sharing AND 401(k) plan, with employee deferrals permitted. The 401(k) employee contributions (and related 401(k) requirements) are not addressed in the document.

I am going to be submitting this through VCP and am trying to weigh the options. Am considering whether this would be safer as a John Doe Submission initially. I am planning to seek approval for retroactive amendment of the proper plan type (and related subsequent amendments).

Anyone ever had to deal with this type of document failure before?

I heard that SunGard (thru a support person) will not be submitting the 8955-SSA on behalf of the TPA's ect that subscribe to the Government Forms software for this current year of filings. This has me wondering how hard it is to use the FIRE system, to obtain a TCC code ect.

I don't think this will be the end of the world but think our next best alternative is to submit these filings on behalf of our clients instead of mailing them to our clients for their signature where they would in turn have to mail them in.

Also, we use Relius Administration. Does anyone have a Report Writer Report that will pull out who should be on the 8955-SSA. I am not a fan of the reports (mainly that they can't be put out into Excel) or the export feature that Relius has built into the software (mainly because it overwrites the Plan inof Worksheet). I would like to get this information into Excel.

We have a participant who entered the plan in 2009 but never elected to defer. This participant decided in June 2011 to start deferring 1% of compensation, which should have been effective 7/1/11, however HR missed the election and did not start deductions. Since this is not a newly eligible participant that was not given the opportunity to defer, does the employer still have to contribute 50% of her deferrals to make her "whole"? I'm reading some past post and the EOB and everything seems to be implied to a newly eligible participant not one that made a deferral change 2 years after entering the plan.

Any thoughts?

Takeover Plan

(We are getting 10/1)

Contributions for weekly payroll still being deposited Monthly - usually by the end of the next month - way late.

How far back do they need to go to file VFCP?

They were under the understanding they were doing things correctly and are going to change to weekly deposits now.

Their prior TPA didn't keep up with regulations.

Plan also was not amended for EGTRRA etc.

Trying to get this small employer out of a big mess with not a lot of expense.

Suggestions appreciated.

Pat

Employer has a service based allocation schedule. They are considering allowing collectively bargained employees participate in the plan and add a separate allocation group for them. If those employees are now receiving employer contributions are they still excludable from non-discrimination testing including gateway?? Thanks.

Grandfathered status is clearly lost if a benefit option is eliminated and the employees are moved to another plan option. My question is whether grandfathered status is lost if a benefit option is eliminated only for new enrollees. For example, can an employer plan provide that new employees will only be eligible for a high deductible health plan option and will not be eligible for the standard PPO plan option?

Company A owns 51% of Company B... Company A has a Safe Harbor and Profit Sharing Plan while Company B has just 1 employee who had deferrals with no company match. The TPA for the plan agrees it is a controlled group with respects to it being a brother sister, but is stating that Company B Employee is not eligible due to the fact Company B never adopted the plan of Company A. I thought if it was deemed a controlled group that it would be eligible regardless of the TPA saying the plan was never adopted?[