Should individuals in the payroll/account payable department which have information regarding necessary payroll deductions for medical/health fsa coverage be "behind the firewall"? Or would the functions these individuals are performing not even implicate HIPAA?

Drinks are on me. Received an email from IRS that they are refunding the $64.25 PTIN application fee.

I know the IRS is looking at more DB plans that choose NOT to file for determination upon termination. Does anyone have a link that gives reasons why it is a good idea for a sponsor to file for determination?

Thanks

Can an Estate that is a beneficiary of a 401(k) plan make a nonspouse rollover to an IRA?

Can an estate open an IRA? I'm specifically trying to figure out if an Estate that is a beneficiary of a 401(k) plan can make a nonspouse rollover to an IRA.

We have a number of new clients who have documents from another Document provider. We are asking that the clients change their document to our doucment provider.

I thought a read a discussion recently (but cannot find) that you should not restate a safe harbor plan during that year as it affects the safe harbor status of the plan.

Does anyone recall reading this thread?

The participant took his pension in a lump sum and rolled it over into IRA. Divorced 9 years later. Non-marital portion of pension was first 11 years of employment. Married 33 years at time of filing. Participant wants to QDRO IRA according to original plan. (pension had a 5&5). Participant also began taking withdrawals from IRA 3 years ago. at age 59 1/2.[ Can the IRA be QDRO'd after 9 years? topic="QDRO"

I have an existing 401(k) plan with a calendar plan year that wants to add a SH provision mid-year. I believe that this is may be possible if the plan sponsor adopts a "wait and see" SH QNEC provision and provides the appropriate notices. Also the plan must use current year method and execute the appropriate plan amendments. Is my understanding correct or not correct?

An individual is employed by two companies.

One company has a SEP and the other has a 401k plan.

She participates in both plans.

My impression is that the total deferral is still 16,500 for 2011 and thus if she defers 8,000 in SEP she can defer up to 8,500 to 401k for a total of 16,500.

Is that correct? Real matter is can she defer to both plans? She earns enough compensation for such deferrals.

thanks

An ee was terminated at the end of April and offered COBRA. The father contacted the employer yesterday and said that after being hospitalized in the ICU for the past few weeks, the ee died yesterday. And in going through the paperwork at his son's house, the father has found the COBRA notice. Can the father elect COBRA on behalf of his son and make the necessary premium payments? It's still within the election period. Thoughts?

For an active plan, we all know that gains and losses in excess of the 10% corridor (if chosen) are amortized over the average future service of active participants expected to receive benefits.

For a plan covering all or substantially all inactives, life expectancy is used.

What about a (recently) hard frozen plan covering 15% active employees with frozen benefits and 85% Vts and retirees, where the actives have been told they will get no future benefit or compensation credit.? Are they active or inactive?

I googled this issue and found a couple of conference sessions that raised this question without an apparent (or at least written) answer. I also know that at least one actuary from a major firm changes the amortization period at the time of a hard freeze from average future service to life expectancy, and at least one accounting firm published a newsletter in support of such a change.

Would anyone comment on their view of this issue, whether hard frozen actives are inactives for purposes of the FAS amortization period?

We have a spousal beneficiary who would like to roll the pretax assets in the plan to her Roth IRA at an outside institution. Is this permissable and if so how is it accomplished? Is there any tax withholding?

A spouse beneficiary would like to roll the pretax assets in the plan to her Roth IRA at an outside institution. Is this permissable and if so how is it accomplished? Is there any tax withholding?

Hello,

I have a participant who is deceased. In Feb 2011 this participant took his RMD for the 2011 plan year. Since his beneficiary (spouse ) is also over 70 1/2 does the spouse also have to take an RMD from the deceased account by december 2011?

or does the distribution from feb 2011 qualify?

Thank you

Let's say there is a small company with only 2 employees. Both are HCE, over age 25, and are working full-time. They set up a DB plan.

Question 1:

Upon meeting plan eligibility - do they both have to participate and benefit? (I believe the answer is yes)

Question 2:

Now, assume both have met eligibility and have become active plan particpants. Everything is running smoothly for a few years.... and then....

Assume that the plan has a 1000 hour rule to accrue benefits and one of the employees ends up working part-time and works under 1000 hours and does not accrue a benefit in a specific plan year - is the plan now in violation of 401(a)(26)? Is the plan now REQUIRED to be amended to pass 401(a)(26)? For example, change away from the 1000 hour rule and amend the plan so that only 1 hour is needed to accrue benefits?

Twist:

Now, suppose there is only 1 employee - the owner (no spouse and no other employees)

What if the plan has a 1000 hour rule to benefit and the owner starts working part-time and works under 1000 hours and does not benefit - is the plan now in violation of 401(a)(26)? Should this plan be amended away from the 1000 hour rule also?

It seems to me that a small plan should incorporate the following plan provisions:

Plan eligibility = 21 & 1 (1 year of service for eligibility purposes should be based on 1000 hours and 12 months of employment)

Credited Service for benefit accruals = 1 hour

Thoughts/comments?

Thanks

Two employers of a controlled group. One participant is a partner in one entity and is an employee of the other. The partnership K1 is a large negative amount. The W2 from the other entity includes $22k in deferrals. When the two compensation amounts are combined, there is a negative number, so no plan compensation. Can some of the deferrals stay as a catch up contribution?

Takeover plan from a payroll company. Plan was originally designed to have 3 month elapsed time eligiblity. An employee enters the plan immediately after 3 months.

The plan also says that if you work 500 hours or less, you have a break in service.

What do you do with employees that are active and enter the plan after 3 months, but never work 500 hours?

A valuation software program determined that an employee's

AB as of 1/1/2011 was 1,200 per month (as computed from a prior year and preserved)

415 100% comp limit computed to be 1,100 (decreased because after two years of pay in the 3rd year pay was $0 and avg pay for 415 decreased).

The program proceeded to determne that the AB was preserved at 1,200 but the 415 lump sum was the PV of the benefit of 1,100.

That is, not the PV of 1,200.

Does concensus agree with above? Think that AB s/b limited to 1,100? Think lump sum s/b based on PV of 1,200? Or something else?

One more piece of info:

The employee received $0 comp for 2010 and worked less than 1000 hours and did not receive a year of svc for vesting or accrual purposes. The 415 100% comp limit did not add a year of service either, but just counted the $0 pay in the 3 yr avg.

thanks

My client is questioning their fiduciary responsibility as it relates to retaining "determination of benefits" data/records, such as in the case of termination request calculations?

An employee elected years ago not to be a participant in the plan. However, he has since terminated and has now been rehired. Can he now become a participant in the plan or does the company have to rely on his prior irrevocable election not to be a participant?

If he can become a participant, would he now need to satisfy the eligiblity rules as if he had never been employed at the employer?

The prototype plan does not permit elections not to participate, but the person had made this election prior to the adoption of the current plan. Thus, his election remained in effect while he was an employee at the company.

Thanks for your input. I just couldn't find anything about this in the ERISA outline book.