We have a small 401k PS Plan that is terminating, I know a resolution is needed for termination. However, I am unclear what type of notice is required for participants in a DC plan. Are they required to receive the 204h notice reduction of benefits? Is there any other notices that they need stating the plan is terminating?

Thanks all.

Can an ACA commence the automatic deferrals 60 days after a participant enters the plan as opposed to the first payroll period after entry? For example, assume a plan has a 6 month eligibity requirement. After 6 months, a participant enters the plan. The participant has the opportunity to elect to defer, but does nothing. If the participant has not elected to make deferrals during the 60 day period, then the plan's ACA provisions would kick in and automatically defer 2% of compensation. The participant would be able to change that autmatic election at any time. I can't find anything that would prohibit this.

Have a Terminated PS/ESOP Plan. The ESOP was coverted to cash many years back and was actually terminated prior to the PS being terminated but it's one plan. We've been distributing to participants from the ESOP for a couple years now. The client is trying to wrap it all up now and avoid another years tax form filing.

Because there is QJSA language still in the plan therefore spousal consent it required, I assume I cannot roll to an IRA such as PenChecks for balances over $ 5000. What are the steps I need to take to get these distributions made or rolled for those participants who are not responding?

What notices do I need?

I did the research but honestly, I was overwhelmed so I turn to you.

Thanks.

I am not sure if this topic should be posed here or in another retirement plans sub-forum.

We're considering changing the definition of Compensation in our US qualified plans (pension and savings) to W-2 (Treas. Reg 1.415©-2(d)(4)) from the short list/safe harbor alternative (Treas. Reg. 1.415©-2(d)(2)) Is there guidance on how to deal with transition issues in such a change? If so, please advise...provide cite. Thanks so much.

IRC Section 432(a)(1)(A) states that a plan sponsor cannot accept any bargaining agreement that provides for the reduction in the level of contributions or the suspension of contributions for any participants in the Endangered Plan.

Since this is the case, is an employer ever able to voluntary withdraw from a plan once it has been certified Endangered? Assuming the employers bargaining unit wants to withdraw, would the fact the plan is Endangered preclude that option?

Is there a way to withdraw short of union decertification?

A non-PBGC, single participant plan terminated in 2008. Assets have not yet been distributed. The sole participant attained NRA on 1/1/2010.

For calculating his lump sum payable as on 12/1/2010 should a late retirement actuarial increase be credited to his accrued benefit?

His assets are much lower than his lump sum but for accuracy in calculating termination benefit I want to clear my doubt whether this participant is eligible for this increase since the plan has terminated 2 years back.

I have a new prospective client and we are discussing plan designs. I have discussed the possibility of a safe harbor plan. I informed them that the SH allocation only needs to be provided to the NHCEs. They then asked about other allocations to the HCEs. My questions are as follows:

1) My thought has always been that a SH plan could be designed with the 3% SHNEC to only NHCEs. It could also have a New Comparability feature with two groups: NHCEs and HCEs. Due to the fact that a 3% SHNEC was being given to the NHCEs, a regular 3% NEC could be give to the HCEs without any type of coverage/nondiscrmination testing. Does anyone disagree with this statement? What about a BRF issue? I do not think it is an issue, but would like confirmation. Thoughts?

2) My thought has always been that a SH plan could be designed with the basic SHMAC to only NHCEs. It could also have a discretionary match feature. Due to the fact that a basic SHMAC was being given to the NHCEs, could the discretionary match of 3% (100% of the first three percent) be given to only the HCEs? I do not believe that there would be any coverage issue, but the ACP test would need to be run. However, if I tested all of the match allocated to the plan and it passed, then there would be no nondiscrminination testing issue. Agree? Additionally, I am concerned about a BRF issue? Based on the basic safe harbor match formula and a match capped at 3% for all, would this be OK? Thoughts?

Any help would be greatly appreciated.

Scenario: taxable organization provides NQDCP subject to 409A. Benefits under the plan are not subject to SROF. The organization freezes deferrals to the plan but otherwise intends to maintain the plan while benefits are paid out according to the plan. Meanwhile, the organization changes its own tax status to a tax exempt organization.

Question: would the plan, which is now maintained by a tax exempt entity, be subject to section 457(f) (assuming its not an eligible plan), causing the deferrals under the plan to be taxable as they are no longer subject to SROF? I think so, but would like others' input.

Thanks in advance.

A guy starts a company on 1/1/2010 and is the only employee on that day... 1/12/2010, he hires several employees.

Wants to start a plan, effective 1/1/2010, with 1 year of service age 21, dual entry, but anyone employed on 1/1/2010 is in the plan... can he have the plan by himself for the first year?

Can a plan use elapsed for individuals for whom hours are not tracked, and counting hours for individuals for whom hours are tracked?

Or must a plan select an eligibitlity service credititing method and stick with it? So for example, if hours are not tracked for salaried people, is the only option to use the equivalencies?

A site specifically suggesting consistency is required would be perfect...

I have to admit I'm confused by the RMD rules for cash balance plans. Am I missing something obvious in the regs?

Do I convert the hypothetical account balance to an annuity benefit and that is the RMD using the DB rules? Or do I treat the account balance like DC Plan and simply divide by the applicable table to get the RMD?

What happens when a 5% owner continues working, getting contribution credits and interest credits but is alos recieving RMDs? If treated like a DC plan no problem, if annuity method; do I recalculate each year based on account balance or add the current year annuity eqivalent of this year's contribution credit to prior year RMD annuity benefit?

Hope this question makes sense.

It has always been my understanding that becoming covered by another group plan can end COBRA early, but being eligible for another group plan does not mean you cannot sign up for COBRA. An employee's son was recently reduced in hours and received his COBRA notice. It says on there that to be eligible to elect COBRA, you cannot be eligible for another plan, including a parent's plan. Did I understand this wrong, are they wrong, or did something change with PPACA and the age extension for dependents? Note, I haven't actually seen the form, but this is how it was explained to me.

Thank you.

We currently took over a large 403b plan and are in the processing of moving the money to a new vendor. In 2006 the client moved money to another vendor however 9 contracts stayed with the old vendor. 5 are currently active and 4 are terminated. All 9 accounts were not included on the Form 5500. I guess Accountant did not know of the contracts. Can we consider them orphaned contracts? Does the money have to moved over to the new vendor for all the contracts or just actives.

Any advice would be greatly appreciated.

TRying to fill out a Crobel 403b "prototype" and strugglng with the interest rate section. Does everyone agree that the Plan Administrator is NOT setting the loan interest rate? Technically, TIAA is loaning the participant the money. I'm just curious what people's thoughts are on this matter...

Anyone encountered this situation?

DB Plan participant retires and startes receiving a joint and survivor annuity. He gets divorced. He wants to name a new person to receive the survivor portion of the annuity but is told by the Plan "No way."

Any assistance is appreciated.

The excise tax for funding deficiencies as referenced in the Form 5330 refer to section 412. If a funding deficiency shows up on a Schedule SB, it is no longer under 412.

THe question is - do we still have to file a 5330 for the 10% excise tax on the deficiency?

I have a multiple employer plan that has adopted a 3% safe harbor nonelective design. The plan has 16 adopting employers of which five discontinued their safe harbor contribuiton for the 2009 plan year. My question is - since See Treas. Reg. §1.401(a)-30(a) allows for each adoptiong employer to be treated as a separate plan, am I OK to just perform ADP testing on the five plans in question? I was not sure if this would create a document issue - the VS does have "wait and see" language.

Any thoughts on this issue would be very much appreciated. Thanks.

I have a client who has had a Solo K plan for him and his wife for many years. THey are 50 years old. WE are using a "canned plan" with Invesco / Aim Funds.

THey would like to roll these assets out of this plan and into a managed IRA program.

However they also want to continue a solo K plan with another open architecture vendor I am suggesting.

Can we terminate the old plan and start a new one? Final 5500 EZ reguired ?

Any other suggestions ?

Thank you.

I have a fiscal 9/1/09-8/31/10 PY that has 29 people that terminated in the prior plan year (2008), but received compensation in the 2009 plan year. The amounts range from 32 cents to $123.77. None of them have hours, deferrals, match or profit sharing allocations. We are debating as to whether they should be included in the testing. As of now, they are not showing up on the census count, as they term'd in the prior year and were paid out (if they had an account balance to begin with). This plan is in Datair's PE-WIN system.

Thoughts?

I know that it is not allowable for one person to be given trade authorization in order to direct the investments of a participant (i.e. a plan participant may not grant their spouse trade authority in order to direct the investments within their 401(k) account). The problem is that I can not find any DOL, IRS, Treas Reg or ERISA guideline that specifies that it is not allowable for a 401(k) to permit any plan participant to add any individual to their participant account has having "trading authority" on their account in order to direct the investments on their behalf.

Guidance? Thoughts?