Hello to All!

I have a retirement plan with a former company. When I left the company the dollar value was less then $20k. I wanted to take a lump sum distribution, however, the fund was frozen. This year I recived notice the fund was no longer frozen, however, in the ensuing time, the dollar value has increased to a little more then $21k. The plan administratior says they cannot honor my request for lump sum payment as they will get in trouble with the IRS. Is there anything I could do, or any exception I could request?

The Plan Document for this states there is a $20k limit for lump sum distirbution. I have sent two previous requests to the plan administrator for a lump sum distribution. Since this seems to be a plan or company policy and not IRS,what can I say, or ask, of him to persuade a lump sum payment?

Thanks in advance!

Someone can get a 5% QNEC plus a 5% QMAC w/o violating the targeting rules, right?

Has anyone had a client receive a letter from EBSA/DOL with regard to late deposits being reported on the Form 5500, with the "recommendation" they file under VFCP? And if so, did you file under VFCP?

Both a PS and an MP Plan had an early retirement feature of age 55 and 5 YOP. The plans were merged a few years ago and I believe the merged plan showed an Early retirement age of 59-1/2. Is that permissible? Is the 55 and 5 a protected benefit or can we eliminate that?

I don't think it should have been eliminated, at least not for the current participants in the plan as of the date of the merger.

There appears to be differences of concern on this one so am revisiting:

Facts:

Calendar Year Plan Year with January 1 (i.e., boy) valuation date. In 2009, there was a minuscule shortfall so that quarterlies are required for 2010. On April 1, 2010, employer elects to offset 2010 MRC by FSCOB. The election language does not speak to quarterly contributions. Was a quarterly contribution due April 15, 2010?

IMHO, if quarterly is due April 15, 2010, then what is point of using FSCOB to offset MRC? Yet, this particular point does not appear to be specifically articulated in final 430 regs., though the regs. do state specifically that the offset occurs as of the valuation date. The conclusion is so long as the election is made before the first quarterly due date, all is copacetic.

Agree? Disagree?

Client is off calendar year - excess distributions due 9/15/10 for failed ACP test but employer match contribution will not be made until after this date - I know I am overthinking this or not thinking at all but do we wait for the deposit to be made and then do the distribution and the form 5330 or do we calculate the distribution and make it before the due date?

We have a client who received a IRS notice stating that their 10/31/2007 5500 was not received. The return was prepared and sent to the client but the client could not confirm that it was mailed timely. They responded to that letter stating that it was mailed timely and attached a copy of the return to the letter. Apparently the IRS did not buy it, additional notices were sent and most recently we had to e-file the return using 2009 forms and also attached a letter of explanation and a copy of the original 10/31/2007 return. They have since recieved a notice from the IRS stating the return was received after the due date and are proposing a $15,000 penalty. The letter does have a spot where you can enter DFVC information. My question is can they still file through DFVC paying the $750 and then respond to this notice stating that they have done this? They have not received any notification from the DOL.

Any input would be appreciated.

Thanks

We have an agreement that was originally intended to comply with the short-term deferral exception. For various reasons, it does not satisfy the STD exception (or any other) and is thus subject to 409A. We are contemplating a document correction under 2010-6.

The question is - can we correct under Notice 2010-6 and restore the agreement to compliance with the 409A exception? Or, once we admit that we are subject to 409A and correct under the notice, will the agreement always be subject to 409A?

Any thoughts would be much appreciated.

My firm has a Cycle D individually designed plan. I just realized that I did not have the client adopt a restatement by 1/31/2010. The plan is a multiemployer plan (so deemed to be a Cycle D plan).

I expressed my concern to an attorney friend who does some ERISA work and he claims that so long as all of the interim amendments have been timely adopted, there is no problem having the client adopt their Cycle D restatement now since the restatement merely rolls the interim amendments into another form, i.e., the restated document. I want the attorney's claim to be right because it solves my problem, but I am skeptical. Everything I've read seems to indicate that the client is now a "nonamender" (under VCP-speak) and that I should use the VCP program to correct the problem.

Do we have a problem to correct?

Thanks so much for any thoughts.

i just got a takeover plan, calendar year, less than 100 participants. It was suppose to have a 1/1/2010 valuation, but wasn't done.

I'm assuming my first step would be to issue a 10/1 aftap for full restrictions. Correct?

I have a ps plan that is cross-tested and excludes certain employees. I have an employee with a large account balance that has now changed positions (and actually went from an HCE to NHCE), and is excluded for plan purposes. My question is, can we use this employee's account balance in the average benefits test? Or, since we this participant is considered not benefitting for the ratio test, is it also excluded for the avg ben test? If not included, we fail the ABT and have problems with 401a4.

I have a Cycle D individually designed plan. I just realized that I did not have the client adopt a restatement by 1/31/2010. The plan is a multiemployer plan (so deemed to be a Cycle D plan).

I expressed my concern to an attorney friend who does some ERISA work and he claims that so long as all of the interim amendments have been timely adopted, there is no problem having the client adopt their Cycle D restatement now since the restatement merely rolls the interim amendments into another form, i.e., the restated document. I want the attorney's claim to be right because it solves my problem, but I am skeptical. Everything I've read seems to indicate that the client is now a "nonamender" (under VCP-speak) and that I should use the VCP program to correct the problem.

Do I have a problem to correct?

Thanks so much for any thoughts.

The Plan Sponsor failed to make the Discrentionary Profit Sharing Contribution by the Tax filing deadline. The Plan Sponsor now wants to make the contribution. What are the implications?

When running the ADP test, we can disaggregate otherwise excludable employees using the early participation rule or running two separate tests. Can the early participation rule be used in the 410b test also or is it's use limited to the ADP and ACP tests.

Thanks.

Does California require withholding on non-periodic (e.g., lump-sum) distributions?

Does anyone have a current list/spreadsheet of which states require withholding on non-periodic distributions?

Thanks!

When can I amend the allocation methods of a standardized plan? Before anyone works 500 hours or before the first day of the plan year?

Company A purchased Company B via an asset sale in July 2010. Company B employees became employees of Company A on the acquisition date. Company B did not have a retirement plan. Company A has a 401(k) plan with immediate eligiblity and entry date.

Agreement is for acquired employees to begin participation under Company A's plan 1/1/2011 with vesting service counted from July 2010.

My question is: can we amend the plan now to provide that acquired employees begin participaiton on 1/1/2011 or should it have been done prior to the sale? Is an amendment even necessary if the sale documents provide for participation as of 1/1/2011? (I know an amendment is necessary for vesting service).

Thanks for any input!

So I was reading the article in the BenefitsLink newsletter from the DOL (EBSA) regarding a new website that they are co-sponsoring with AICPA. I clicked on the link to the website www.choosingaretirementsolution.org and starting checking it out. The section that you can use to help you determine what kind of retirement plan to choose seems to have a glitch in it (I hope). I decided to choose options for a small employer (under 100 employees). You can enter any type of entity, and I also chose that I wanted employer contributions only with a vesting schedule. No matter what the entity, it comes up with no retirement plan options available. I sure hope not! Defined benefit plans do not seem to be provided as an option here. I was surprised that the EBSA would co-sponsor something like this.

Anyone else check it out?

My document requires the offset be "by the Participant's monthly benefit provided from the Profit Sharing Plan non-elective accounts attributable to contributions and associated earnings for plan years beginning on or after January 1, 2010" So I use account balances to calculate the offset, no problem.

Does this also dictate the testing methodolgy? For future years, to avoid exposure to bad investing on the PS side, could I still operationally test for non-discrimination based on current year accruals & contributions only?

I have a couple plans that are terminated.....one plan made a PS contribution many many moons ago and we are left with numerous participants without addresses and minimal balances. We were considering transferring their balances to 'Unclaimed Funds" any thoughts

Another we have participants with substantial balances and would like to open rollover accounts but not sure how to go about it (where, how, fees, trustee responsibilities.......)