We have a non-resident alien beneficiary, living in Mexico. What is the procedure for paying out a distribution? Does the administrator send the distribution form along with a W-9 and if beneficiary does not produce a SSN or TIN, or W-8BEN then withhold 30%?

Thanks

The late retirement definition of the plan is basically at the participants request he may continue working, but shall start receiving payments as though he had actually retired on the normal retirement date. At the close of each plan year prior to the participant's actual retirement dated, such participant shall be entitled to a monthly retirement benefit equal to the greater of (1) the participants monthly retirement benefit as the close of the prior plan year, or (2) the participants ab determined at the close of the plan year, offset by the actuarial value of the total benefits distributions made by the close of the plan year.

pretty normal stuff.

well, the participant didn't actually start taking payments until he was 69 1/2. So the ab was actuarially increased to that point, instead of paying him past payments with interest.

My question is this for his 1/1/2011 ab, do I calculate it like this... the greater of 1) his actuarially increased benefit at 1/1/2010, or 2) his actuarially increased benefit at 1/1/2010 + his 2010 accrual - the actuarial value of his distributions.

Thank you,

Andrew

Hello, I am very new to discrimination testing, especially in regards to 403(b)s. I wonder if any of you have any insights on whether the following employer match would satisfy discrimination testing. It's a union shop with pay increases based solely on years of service. The plan is for management too, whose pay is significantly higher than the regular employees.

If this would pass based on its status as a 403(b), any problems if this was a 401(k)? Thanks

Length of Employment & Maximum Employer Match

1st to 2nd Anniversary 2%

2nd to 4th Anniversary 3%

4th to 6th Anniversary 4%

6th to 10th Anniversary 5%

10th to 14th Anniversary 6%

After the 15th Anniversary 7%

I know this can't be a unique situation, but I've (luckily) never had to get involved in it before...

Small private school has a 6/30 plan year end for their 403(b) and profit sharing plans. The eligible teachers are under contracts that run from 7/1 - 6/30 (matching the plan year), but pay doesn't start until they start "work" ~9/1. The teachers have the option of taking their contractual pay over 10 months (9/1 - 6/30) or 12 months (9/1 - 8/31). The school has used this contracted compensation amount as compensation for the plan year all along, claiming that because they accrue the pay back to 6/30 for those who elect to receive it in July and August, this is OK.

Hmmm.

I'm concerned about things like "constructive receipt" and timing of deferral deposits and when partcipants can make elections on their compensation. If we count this compensation in the previous plan year, do we just end up carrying the deferral deposits made in July and August as receivables? Can a participant elect to stop deferring on August 1?

This must all work out somehow, because I'm sure most schools do this kind of thing. Right?

Good morning,

I was trying to do some research and look for court cases where a Plan Administrator was penalized because they were not running their cafeteria plan correctly (i.e. according to the written plan document and regualtions). Does anyone know of any court cases that would address this? I know that S125 audits are few and far between. Any assistance would be greatly appreciated.

Once a multiemployer plan enters critical status does 305(f)(2) of ERISA prohibit it from making actuarial adjustments to those participants who retire past normal retirement age?

If not, can the late retirement increase be treated as an adjustable benefit?

The title says it all. I am 24 and just began a roth IRA with Schwab. I would like to submit funds this week but I just don't really know how to get started. I like to manage these types of things on my own so I kind of just like to learn a little bit of what is recommended for me and then go from there. I am young and obviously don't want to be extremely aggressive with what I invest at this point. Schwab told me that they do have consultants that they can set you up with over the phone to kind of get me started and I was wondering if this is a good idea to listen to their advice or not.

Basically my question is, what would be the best types of options for me just starting out? I have heard that mutual funds are something to look into and to diversify your investments. Can someone here point me in the right direction (I'm not necessarily looking for anything specific, just ideas of what the heck I should do) as far as how to invest? Is this consultation with Schwab a good idea? If you could please talk to me in the most laymen terms possible it is appreciated, I'm not dumb, just new at this I guess. Thankyou all very much for any advice you can give me.

Same situation as this fine article:

http://benefitslink.com/modperl/qa.cgi?db=...esign&id=11

However, the "spin off company" is a 501©3. Can they co-sponsor the 401K or the controlling organization?

This isn't my area of expertise, so pardon if this is a stupid question.

PA company.

Company XYZ has 100 employees. 3 are leased to a non-profit XYZ community programs (XYZCP). XYZCP has its own board and is a 501c3. Company XYZ is a for profit with over 100 owners.

Currently, the 3 leased employees are under all the benefits plans of company XYZ, NOT XYZCP.

How should we proceed? I've done a bit of research, which I'm 95% confident of. But I wanted some other opinions to check myself.

I don't know too much about KEYSOP's.

Can anyone expound upon what they are and are they subject to 409A like a nonqulaified plan?

Employee made deferrals in 2010 before being eligible to do so, but the mistake wasn't discovered until 2011. The deferrals and match will be moved to suspense/forfeiture account. Employee will be made whole through payroll outside of the plan, but in which year will those reimbursed dollars be taxable---2010 or 2011?

Company A has financial problems so Company B comes in and purchases A and keeps the company name. After the purchase B terminates some employees and then rehires them back a few days later. Employees still have money in A's plan. Can A's plan terminate or would it be considered a takeover?

Is there other questions/information we should find out?

Thanks!

Plan provides QNEC to Ee A of 2% to pass the ADP Test. The GWM ius 5%

1) When I run (a)(4) WITH QNEC's I find that I need to give A a 3% contribution to get him the GWM

2) When I run (a)(4) without QNEC's, A is no longer benefitting in the nonelective plan, and therefore, he does not need the gateway minimum.

3) HOWEVER, once I give profit sharing to A, I cannot run cross-testing without profit sharing (because that would be ridiculous . But when I go back and run testing without QNEC's, he's not getting the GWM!!!! So now I need to give A another 2% profit sahring.

In summary, when I do QNEC's, I have to give the full THM in profit sharing.

Someone please tell me I'm overhthinking this, and it is really not as I say...

Employer terminated a solo-401(k) and did a direct rollover distribution in 2010. Also established a new PS Plan effective for the 2010 plan year. Looks to me like a "successor plan" issue. If so, which event - the distribution from the 401(k) plan or establishing the new PS plan - is actually the 401(k)(10) "violation", what are the ramifications of same - and any way to "fix"? What if no contributions are made to the new PS plan for 2010?

Almost hesitate to ask, as I am fully aware that logic and IRS regs are often mutually exclusive, but does anyone have any idea as to the original "thinking" behind the successor plan rules?

Thanks for any and all input!

I recall hearing somewhere that there was a time period in which a plan (DC) had to be paid out after the termination date. does anyone know or have a cite?

Client wants to deposit set amount now and use whatever amount that is in excess over the minimum required amount for 2011 (undetermined at this time) towards any 2012 minimum required contribution. Doable?

Assume it fits within the deductible range permitted for 2011 & 2012.

easy question for all those veteren ft william users...my 2010 5500 validation is telling me that the 'Sponsor's name is red or blank".

I can't seem to clear the error.

any ideas?

Problem solved...it didn't like the client's name the way I had it! The first 2 letters of the Company name are initials (not separated) and they went in 2009 with no problem.

FT William wanted the 2 letters separated; i.e. if the client name was A.S. Smith Company - in 2009 I used "AS Smith Company" and it went through EFAST2 fine but FT Wm wants me to put "A S Smith Company" with the space between the letters.

Who knew

OK, how about this one? Brand new DB plan (yes, there are some) effective 1/1/11. Plan is adopted on 3/1/11. Employee terminated on 2/1/11, but was otherwise eligible as of 1/1/11. Plan says if employee terminates prior to the date the plan is adopted, employee is not a Participant, even though he was employed and otherwise eligible on the plan's effective date of 1/1/11. Can do or no can do?

Association X is incorporated for the purpose of providing education to members of y field. Association X has member employers in y field. Association X provides approved apprenticeship training to the employees of its members.

Is this an ERISA plan? A MEWA? Can association avoid being considered either by running the accounting for the training programs through its general assets?

We are taking over a 401(k) plan from a payroll vendor.

The client did not file 2009 5500 until mid December. Client included a letter explaining the difficulties with the EAST2 system that was clearly supplied by the former tpa:

"This filing was delayed due to the following difficulties with the electronic filing system......"

Then listed network, error message, and other problems.

So this clearly was NOT a DFVC filing.

Now IRS sends a letter proposing a $1500 penalty for the late filing.

2 questions:

Does anybody know if there is a way to find out if DOL accepted the reasonable cause and is not going to penalize? It makes a difference as to IF there should be a DFVC filing

If the client sends a reasonable cause letter to IRS, and it is rejected, can they still get relief with DFVC

Don't you love competing agencies who barely communicate?