Been a while since I've encountered a similar situation and am just looking for confirmation (or condemnation!) that the following is "doable" -

Existing Profit Sharing Plan (calendar year plan year) wants to add a 401(k) arrangement yet this year. Definitely a "safe-harbor 401(k)" candidate, but obviously too late for SH for 2011 at this point.

So, for 2011 the Plan will adopt a "traditional" 401(k) arrangement effective December 1, 2011, using "prior year testing" with "deemed 3% deferrals" and "deemed 3% matching" for ADP/ACP purposes, allowing the HCE participants to be able to defer 5% of comp and receive a 100% match (i.e., also equal to 5% of comp) for the 2011 plan year.

Switch to "safe-harbor 401(k)" effective January 1, 2012.

Viable approach? Anything better?

Thanks for any and all replies.

Can a retirement plan recover the cost of filing an interpleader from a participant's account?

I typically specialize in priviate-sector plans and am aware of the dire consequences to an employer for being late in forwarding employee contributions (from salary deferrals) to a plan.

Now I'm trying to assess a late contribution issues for a school district 403(b) Plan and am hitting a dead end.

Since school plans are exempt from ERISA, is there a penalty/risk to the district for having been late for a couple of months (over the summer)? All contributions have now been properly forwarded to the vendor.

Since there's no Form 5500, they won't have to report the late contributions there.

Any authority that anyone knows about for the district having to make up lost earnings to participants? I suppose they could use the DFVC calculator to determine lost earnings, but am wondering as to whether there is potential enforcement on this point.

Any insignts welcome! Thanks.

When running a BRF test, can the test be disaggregated? (apply less than 21/1 YOS rule) Does it need to follow the same method as coverage & ADP/ACP? In other words, if the coverage & ADP/ACP test use the 'otherwise' excludable option, is that required in the BRF also? Or are they separate?

Thanks for your help!

If an employee separates from service and is subsequently rehired in the same year, can the employee or employer make election changes or is the employee locked into the previous election he/she made earlier in the year? Basically, does a separation from service cancel out an employee's previous elections? Any guidance on this issue is appreciated.

I feel I should know this but don't.

Company A sold all of its assets to Company B.

Company B hired all of Company A employees.

Company A has no more payroll and is terminating its safe harbor 401(k) plan prior to year end.

Does Company A still get safe harbor relief for the year or is it subject to testing?

I don't think my M/S Office password protection will cut it anymore. Mind sharing how you receive your emailed census data securely?

We have a 401(k) Plan that covers only highly compensated employees (there are no non-highly compensated employees). Is there any problem with offering a 200% match under the plan?

Can someone point me to the Code or Regulations that permits ESOP dividends to be taken and all distributions, other than hardship distributions prior to a hardship withdrawal for a plan that is following the non safe harbor criteria?

Does the form require original signatures for filing? Or is it acceptable to get the client to sign and scan/email or fax back to us for filing? I didn't see this addressed in the form instructions and when I called the IRA helpline they said it could take up to 30 days for a response....was hoping to have these done before then. Thoughts?

In determining expense under FASB, the expected return and interest expense generally include postulating expected benefit distributions during the year. Suppose the assumption is that the plan always distributes benefits in a lump sum and further, that active participants over the normal retirement age are assumed to retire on the valuation date. In such case, the expected distributions would include expected lump sums. Suppose, there is an active big guy over normal retirement age who if the lump sum were paid would trigger FASB88.

Does it make sense to include this lump sum in the expected distributions? Thus, only enter the expense determination if the big guy retired and received a lump sum distribution. Or, is the treatment no different from any other distribution?

Perhaps, the assumption should be retires one year later?

I have a take over 1 man plan whose sole investment is a piece of property with a mortgage that exceeds the current appraisal of that property. We took over the plan in 2009 and the mortgage was not mentioned. He just let it slip this time around.

I believe that rental income goes to pay down the mortgage. The owner participant is 69, disabled and seems to have trouble understanding what I am saying. I feel sorry for him and would like to help if possible. (How do I get into these situations?). I'm wondering if there is a way I can fix this for him by distributing the investment property to him with the mortgage. The net value is negative so there would not be a taxable event. I don't know what else we can do for him.

Of course I would send him a letter and ask him to sign off on it that we essentially did not create or advise him to create this situation and that we recommend he discuss the situation with an ERISA attorney before he proceeds.

Any thoughts?

Target was acquired in a stock deal. As required by Buyer, Target adopted resolutions terminating its 401(k) profit sharing plan immediately prior to termination. Target's plan permitted Target to make discretionary profit sharing contribution at year-end which Target had done in some prior years. Target has not promised any of the 401(k) Plan participants a profit sharing contribution this year and the final Board Resolutions terminating the 401(k) Plan did not mention making a profit sharing contribution in any way. Target had, however, "accrued" an amount on its books that it was planning on making as year-end profit sharing contribution prior to getting sold.

Does the fact that the 401(k) Plan has been terminated prevent the Target from allocating this accrued amount as a profit sharing contribution on behalf of participants up through the short plan year ending on the date of the plan's termination?. Buyer is fine with the amounts being used for this purpose but does not want to do anything that would jeopardize the status of the plan as having been terminated prior to closing for 401(k) Plan successor employer issues, etc. Thanks for any thoughts.

I am reviewing a pension valuation where the mortality table is described as the "1990 Commissioners Mortality Table" in the assumptions section. Is anbody familiar with this table? I hear commissioners table and think of a table used in the development of reserves in the insurance industry. If this is the case, I have a hard time understanding how a credentialed actuary can justify using it for a pension valuation.

Upon a review of the sample q's in the report, it appears that it may be the "90CM" mortality table. Apparently, this mortality table is "for use in computing (among other things) the charitable deduction arising from a contribution to a charitable remainder trust, charitable lead trust, charitable gift annuity, or pooled-income fund where the term of the agreement is measured by one or more lives." Is anybody familiar with this table and its appropriateness for determining pension annuity liabilities?

Self-employed doctor has a DB plan and DC plan, no employees. He took a loan out of the 401k Plan on 7/1/2011 for $50,000 and just repayed the entire thing. Now he is terminating the 401k Plan but keeping the DB Plan. Does his loan from the 401k Plan limit the amount of loan he can take from the DB plan after the 401k Plan is terminated? Does the $50,000 threshold apply to each plan or the combination of the two?

If an employee separates from service and is subsequently rehired in the same year, can the employee or employer make election changes or is the employee locked into the previous election he/she made earlier in the year? Basically, does a separation from service cancel out an employee's previous elections? Any guidance on this issue is appreciated.

Here's a twist to this common question . . . Can my husband enroll in a HDHP HSA. The employer will contribute $2,000 and he will contribute nothing. Then, can I fund my FSA to cover the remaining deductible and co-insurance? Can I just substantiate my FSA expenses by showing that they were all MY charges and that none of it was used by my husband?

Just back from ASPPA and geared up to get our 8955-SSA's filed for our clients. The question regarding having supplied the required individual statement was mentioned. Does anyone have any particular wording they are using? The instructions generically say to provide a statement setting forth the information contained in the SSA form. Isn't all this on the quarterly plan statement that most 401k participants receive regardless of active or terminated status? Any thoughts on the wording you're using out there would be appreciated, Thanks

If a company begins 10/1/11 and their 401(k) plan also begins on the same date, but has a 12/31 year-end date, is that still considered a Short Plan Year?

Does anyone have a good outline that would address this topic that you'd share with me?

Please send me a private message if you do.