Any thoughts on whether a participating employer is legally required to continue contributions to a multiemployer health fund during a strike or a lockout. It appears to me that it will depend on the terms of the CBA. In a single employer plan, I believe an employer could cut benefits that have not accrued prior to the strike, assuming there is no contrary provision in the cba.

Any thoughts? Any relevant case citations?

The instructions say to give someone an Entry Code of "D" if they have been paid out or if their balances have been transferred to another plan.

Also, it says to "d"elete someone if they have begun to receive benefits from the plan. I have two questions:

1. Would this include someone who is taking RMDs from a 401(k) plan?

2. Would this include someone who had a $50,000 balance and merely took a $15,000 partial distribution from a 401(k) plan?

On a side note: I also see that you are supposed to put the person's name on the form "exactly as it appears on the participant's social security card." How are we to know? I have plenty of participants with the name of Timmy O'Brien or Peggy Swanson. Is that really a big deal?

I have gotten this for aobut 4 clients. It says that the plan administrator's [and plan sponsor's in a seperate error code I-104SF] userid and pin are missing or invalid. The filing must contain this valid information.

In 2 instances of mine, the client/trustee did not have the same email address that I used to send them the published link, etc in their filing credentials. In the other 2 instances they did, and we can't figure out why the transmission was stopped. Of course, not being there with the client actually does the e-signing to know whether they are doing it correctly can be a hinderance. But they must be doing something correctly, as they e-sing it and I receive notification that is it signed and ready to be transmitted.

Anyone else have these frustrating problems? thoughts on this !@#$% issue?

Bipartisan support is building for a deficit reduction plan created by a group of six Senators ("Gang of Six"). President Obama supports it. Some key Senators also support it. In order to address the debt ceiling and the deficit, the Gang of Six want to ""Reform, not eliminate, tax expenditures for health, charitable giving, homeownership, and retirement."

According to some reports, 401k plan contribution limit may be lowered to bring in more revenue. Has anyone else heard about this? Are lower limits on the table for 401k plans?

My company has a cash balance plan--actually it's a hybrid plan but lets just go with CB for simplicty.

The plan provides participants with the usual benefit options: Single Life, 50%, 75% and 100% J&S Annuities. The Plan also offers each of these benefits with a post retirement death benefit feature which, in the case of a single life annuity, provides a lump sum benefit to the participant's named beneficiary in the event that the participant passes away prior to receiving the full distribution of his/her account (and of course the payments continue to the participant even when the account balance at retirement is "exhausted"). If the participant elected a J&S w/ PRD, his/her benefit would be payable to the joint annuitant and, if there were a balance left at the time the JA passed away, the remaning balance would be paid to the named beneficiary of the PRD benefit.

So, with that little bit of information: An unmarried participant who has commenced benefit payments recently contacted us about changing the named beneficiary for his post-retirement death (PRD) benefit. He elected a the Single Life Annuity w/PRD. There is a reduction to the benefit if you elect a PRD option (example: Single Life annuity factor at age 63 is 10.02, Single Life Annuity w/PRD factor at age 63 is 97% of the Single Life Benefit)....don't really know why you would further reduce a benefit that is already actuarialy adjusted to pay out your entire accrued benefit based on your life expectancy but that's just me (meaning that if the annuity factor is 10.02 that should be calculated to reflect that your life expectancy is 12 x 10.02=10 years 2 months which should payout your entire benefit but that's neither here nor there). The Single Life w/PRD factor is not based on the participant's and named beneficiaries age, it's just based on the participant's age with a reduction for electing the PRD option.

Our plan is silent on changing the named beneficiary for the PRD benefit and I can't find ERISA guidance on the subject. Again, because the benefit is not based on the beneficiary's age (unlike a JA benefit...which is of course irrevocable), I don't see any reason why a participant couldn't change the named beneficiary of the benefit but I'm unsure. Any thoughts?

A client decided to be proactive and pay out terminated employees from a defined benefit plan. No one really knows exactly where the values that were paid out came from, but they sent out 10 checks to 10 vested terminees with no distribution paperwork in December 2010. It appears that all of the distributions made were far below the actual amounts that were due each participant. Now, I am trying to distribute the remaining amounts. None of the benefits approach 415 limits.

Is this the correct method to determine the remaining distributions:

Determine the equivalent monthly benefit of the lump sum distribution based on both plan rates and 417e rates. Take the lower of the 2 monthly benefits, subtract that from the total accrued monthly normal retirement benefit to deterimine the portion of AB not yet distributed and use that to determine the value of the optional forms of benefit yet to be paid.

Obviously there are issues with not obtaining spousal consent or providing the option to make a rollover and those are currently being addressed as well.

I have a plan that failed their 2010 ADP test but did not process their refunds until shortly after March 15th. I know they need to file a form 5330. On the 5330 is it line schedule H where I put in the dollar amount of the excess? Also do I include the earnings that were applied too or just the excess contributions? Thanks in advance.

I have a 403b plan that has adopted an amendment to the accrual requirements. It used to say 1,000 hours required but they were funding pay to pay. I pointed out that was a conflict. Their attorney amended the plan so that "for the contribution for any pay period the Participant has an official work schedule of at least 20 hours a week for that pay period."

Disregarding the fact that it became an individually designed plan, how would this be tested?

There were about 4 (of 150 participants) whose schedule changed mid-year. So they stopped getting a contribution at that point (saving the ER about $0.75, but I digress). So for 410b they are in the numerator and denominator and coverage is 100%. Can't be that easy.

The contribution is a hard wired 7.5% of pay.

Would it become non-uniform allocation rates and must be 401(a)(4) tested for non-discrimination? Or maybe it is a Benefit/Right/Feature so I would NDC test it?

Thanks!

Are PTIN's required to file the 2010 Form 5330? I don't see it on the IRS' list as an exception to the new PTIN rule.

What are TPA firms doing if a PTIN is required on the Form 5330 and nobody in the firm has a PTIN? Are you advising clients to have their CPA's complete and file the 5330?

I'm working on allocating a QNEC instead of using the one-to-one method for late excess contribution refunds. The plan uses prior year testing I understand that under EPCRS you have to use the appropriate participant data (so for 2005 failures I need to allocate the QNEC for 2004).

I've ran into a problem - this plan failed in 2005 but this was their first year of testing so they used the "new plan rule" and had a max HCE average of 5%. How do you allocate a QNEC in 2004 for that? Or maybe I need to use one-to-one in this situation since that's the only way I can determine the amount of the QNEC?

Please help! (Tom, I know you and your massive brain are out there somewhere!)

Thanks for any help you can provide!

Vicki

Plan year is 8/1 - 7/31. Paying a lump sum on 7/31/2011 during the plan year beginning 8/1/10 - 7/31/11. Under 417e, do we use the 2010 applicable mortality table or the 2011 applicable mortality table?

Are a participant's Roth 401(k) contributions available for in-service withdrawal (if the plan so provides) after being held in the plan for two years? Or are they subject to the same in-service withdrawal restrictions as non-Roth (traditional) 401(k) contributions (hardship and age 59 1/2)? Can anyone direct me to guidance on this issue?

I am looking for any thoughts or regulatory guidance (please cite such if it exists) to deal with the following scenario...a participant with a qualified defined benefit pension plan was a lost participant for a lengthy period of time (25+ years or more). The participant had not been employed with the company for many years prior to what should have been the date his plan benefit should have been commenced (it should have been commenced on his normal retirement date of 2-1-94) based on the plan provisions. He was recently found July 2011...at the age of 82)...long after the date that his benefit should have been commenced (normal retirement date)and long after required minimum distributions should have commenced. He is not a 5% owner...thus required minimum distributions should have commenced by April 1 following the end of the calendar year in which he achieved age 70 and 1/2....based on current applicable law and associated regulatory guidance.

The benefit is not insignificant..being slightly over $1,000 per month (single life annuity at normal retirement date...he is not married)...and he is due that amount per month back to 2-1-94 and continuing until his death.

If participants or beneficiaries do not receive their minimum distribution on time, they (not the plan) are subject to a 50% additional tax on the underpayment. To pay the additional tax, the participant or beneficiary must attach Form 5329 to their federal income tax return for the calendar year in which the minimum distribution was due. The IRS may waive the additional tax for reasonable cause, if reasonable steps are being taken to make up the distribution. I understand, however, if there is reasonable error, the individual may file for a waiver following the procedure described in the Form 5329 instructions.

Is there any specific guidance (maybe some "special dispenation") allowed in a case of a lost participant such as this that avoids the necessity of the participant having to file for a waiver per the procedure described in the Form 5329 Instructions? Any other thoughts/guidance? Do the retroactive annuity starting date regulations/guidance have application in some form here? How about thoughts on required withholding (federal) of what will be a rather large payment to "catch him up"? We're still figuring out what the state withholding (if any would be).

Thanks for any help. Odd case. Bit of a brainteaser...at least for me.

What are common reportable transactions for this line?

A DB plan participant did not cash the first check for his benefit distribution. When re-issuing the check, can the employer pay the original amount or does it have a duty to pay interest to cover any lost earnings?

Does it matter if the payment was a lump sum distribution or part of an annuity?

We are reviewing prior returns for a potential client, and discovered that all previous forms have been filed using calendar year dates when the document specifically states that the plan is to coincide with the company's fiscal year (8/31).

What is the correction in this instance? It appears that the actual data used in completing the form was correct (9/1 to 8/31), just the dates on the form were wrong. Would all prior filings need to be amended? Just the last 3?

Two Owners, One employee - Employee is Highly Compensated - does he have to be included in the plan or can we carve him out since he is Highly Compensated?

Thanks

I know a coprporate extension can be used to extend a Form 5500 filing, but it would only extend until 9/15 for a calendar year plan.

Can a sole proprietor extension be used in place for a 5558 is the sole prop is extended - again for a 12/31 PYE?

A small plan sponsor wants to sell a $40K note in a pension plan to its psp in order to have enough cash in the pension plan to pay a non-common law participant. I think this would be a prohibited transaction as the plan would be considered a party in interest. Ultimately both plans will be terminated. The pension plan is not liquid. Do you think approaching the IRS for approval would be an option?

The ER discovered that EE and ER matching contributions weren't made to the company's SIMPLE IRA plan for a period of about 18 months. He immediately made arrangements to make the missing contributions including lost earnings. He filed under VCP and will be getting a compliance letter. However, the draft of the letter says that the IRS will not disqualify the plan, but it doesn't make reference to any penalties. I've determined that 4972 doesn't apply, but I'm not so sure about 4979. The IRS says 4979 penalties don't come under the scope of VCP. I want to make sure that our client covers all his bases. Should I be concerned about 4979?