Under what situations should I secure a Erisa bond for our 401k plan? Do you always need one?

thanks

Our policy states that 401K matches will be made matching an employees contribution of 8% (100% on the first 2%; 50% on the next 6% deferral) up to a $16,500 contribution limit, but also specifically provides for catch up contributions. The policy states that catch up contributions will not be counted toward the matching limit. An employee eligible for catch up contributions contributed the 22,500 to his 401K through regular payroll deduction. The payroll service provider stopped matching contributions after the employee reached $16,500 in total contributions and insists the employee is not eligible for additional matching contributions. The net result was that after semi monthly pay period 19, the employee no longer received any matching contributions.

The payroll service provide insists that because the match is determined on a pay period basis, and not on an annual basis, the affected employee is not eligible for match. Anyone have any experience with this and provide reference/ruling for the PSP?

I should know this, but I'm drawing a blank. Presumably 20% withholding doesn't apply, but does 10% withholding apply, absent an election by estate representative not to have any withholding?

P.S. - FWIW, my opinion is that the 10% withholding applies if the estate representative doesn't elect out of it.

Plan failed to make the 2008 Safe Harbor contribution by 12-31-2009. The contribution and lost earnings (less than $100.00) have now been made. Does the plan report the late Safe Harbor contribution on the 5500? I know that any employee derrals that are made late must be reported in line 10a on the 5500-SF. Thanks!

Plan excluded a certain class employees that were actually eligible to participate. This has been going on for the last 8 years. The plan has filed 5500s for all years, so the statute of limitations on the IRS side of things has been tolling. We could correct just for open plan years. But what about DOL audits? Couldn't the DOL come in and audit years beyond the last 3 and require corrective action and impose sanctions?

DB Plan terminated in 2009. They decided to wait for the DL to be issues to process distributions. The DL was received in January 2011. There is approximately $100k of shortfall. Their options, as I understand it, are a) fund the shortfall and pay everyone out, or b) have majority owner(s) forgo benefits. It is a PBGC plan. My question is, if they decide to fund the shortfall, is this contribution deductible in 2011?

An ummaried participant in a very low benefit DB plan is due 180.00 per month (life annuity). She has terminated and is due minimum distributions starting in 2010 (first due by April 2011). If she receives a monthly benefit of over 150 per month she will lose certain medical benefits (not sure if state or federal). Can she donate all monies due to her in exces of 150 per month to a charity to avoid the problem? How would I code the 1099R to the charity?

any thoughts would be appreciated.

Plan sponsor forgot to submit the 2009 safe harbor match due to one hce. If they submit now will that be subject to 401(a)(4) testing? My inclination is that it will be since we are more than 12 months past the end of the plan year.

Thanks in advance for any guidance.

Employer has frozen DB union plan not required to include top heavy provisions. Employer also has DC plan covering non-key employees also covered under the DB plan. How should employer handle Question 8c, which asks about the minimum benefits received by the employees covered under both plans when the plan being submitted is not subject to the top-heavy provisions? Would this question be inapplicable under these circumstances?

Client has a Section 125 plan document that basically indicates basically this: You get a bonus of $1,000 a year if you opt out of employer paid health insurance benefits.

My position is that this compensation could be considered a fringe benefit as it is a component of the health insurance plan. It's all part of the health insurance fringe benefit.

I'm looking at our document and simply idnciates that "fringe benefits" are excluded (i.e., lower case f and b, with no elaboration on what that means...).

Is there a definition of fringe benefits out there that might be relied upon? Or does the fact that it is cash make it, by definition, NOT a fringe benefit.

What about a non-accountable car allowance that some companies pay to their salesman? I've always that was a fringe benefit.

Suppose you have a partnership with 8 partners that buys a corporation with 25 employees.

Is there anything wrong with having the partnership sponsor a safe harbor match 401(k) plan and the corporation sponsor a separate but identical safe harbor match 401(k) plan? The partnership plan would exclude all non-keys and the corporation plan would exclude all keys.

They are a controlled group and affiliated service group so both plans would be aggregated for purposes of 410(b). All employees that meet age and service would be covered with exactly the same benefits under either plan.

The reason they may want to have two identical plans rather than one is that the partnership plan could file a 5500-EZ and not be subject to the audit / high bonding requirement for non-traditional assets. Many of the partners are big non-traditional asset investors. A controlled group can now qualify to file an EZ.

I have a situation where the 401k benefit owner died after reaching age 70 1/2, but before that calendar year ended. The MRD for him was made the next calendar year, as was the MRD for that next year based on the spouse (herself already passed 70 1/2).

The preparer of the 1099-Rs wants to do just one. We think there have to be two, one to the estate of the decedent (and its TIN) since it was his MRD and the other to the surviving spouse (and her SSN).

Two or one?

Situation: Employee terminated back in June. Took Cobra dental but declined the health. Plan anniversary (renewal) is Jan. 1.

Our COBRA administrator is telling us that because the beneficiary is a current COBRA dental beneficiary, the beneficiary has the right to enroll in the health effective 1/1.

This doesn't sound right. There was no loss of health coverage to trigger COBRA eligibility for the employer's group health coverage.

Can anyone confirm/deny this position?

Thanks!

Last year, a recently retired participant in a Profit Sharing Plan decided to elect an annuity as their form of distribution. Her account balance was used to purchase an annuity from an insurance company and going forward, she will receive any payments directly from the insurance company.

I know that the annuity purchase itself it not a taxable event and the individual will receive a 1099-R from the insurance company whenever money is withdrawn from the annuity.

From the standpoint of the Profit Sharing Plan, however, is a 1099-R required to be issued to the participant? If so, which boxes and codes should be used?

I could be misssing something, but the 1099 instructions don't seem to address this particular situation.

Thanks!

Have a client who is interested in getting an audit done of just their organization's participation in a multiemployer defined benefit pension plan. Does anybody know how feasible this is and if it can be done in a cost effective manner? We are wondering how difficult it would be to get their data segregated out of the plan in an audit package or is it likely that everything would just be too comingled together within the multiemployer plan to make an efficient audit of one of the participants unlikely?

Any thoughts or guidance would be much appreciated.

Does the phrase "acquisition, disposition or similar transaction" in IRC 408(p)(10) include a sale of assets whereby after the sale of assets the purchase would otherwise violate the 100 employee limit? Any help is appreciated.

Question 3g: Does this plan benefit noncollectively bargained employees or are more than 2% of the employees

who are covered under a collective bargaining agreement for professional employees?

See Regulations section 1.410(b)-9.

My plan only covers doctors and employees (not collective bargainged). How do I answer this question: Yes or No?

Thanks for all responses.

Our firm completed a 2010 5500EZ for a client who has a 2010 calendar plan year.

It is my understanding that the 2010 5500EZ is not yet available, thus our firm used the 2009 form and hard coded the plan year from 1/1/2010 to 12/31/2010.

That seems reasonable assuming the 2010 5500EZ is not available.

My firm also did the same technique in preparing the 2010 Schedule SB.

My understanding is that the 2010 Sch SB may in fact be available as I already possess the instructions to the 2010 SB.

Is that correct?

And if so it seems it would be more appropriate to use the actual 2010 Schedule SB form?

Thanks

A plan is planning to terminate and file a 5310 on-cycle (1/31/11). Is a 5300 also needed to be filed? I haven't been able to determine this under 2007-44.

Does anyone know when the 2010 5500-EZ will be available? I have several clients that are both short years (Plan terminated and assets rolledover) and full year Plans (administration completed) that I am ready to complete 5500-EZ's for.

Any help would be greatly appreciated.

Thank you.