If a participant elects a non-QJSA life annuity payment form under a DC plan that is not generally covered by the QJSA rules, is the plan required to offer a QJSA form of benefit? Likewise, is the plan required to offer a QOSA?

I don't think so since the participant has already selected a benefit form and it seems unlikely the participant would want to change. It seems it would be a wasted effort to offer a QJSA or QOSA when the participant has already selected another form of life annuity. But what do you disclose in the QJSA notice?

Also, if the particpant's spouse won't consent to the non-QJSA form of benefit selected by the participant, it seems that the particpant would have to select one of thee non-life annuity benefit forms already offered by the DC plan, and not a QJSA or QOSA. Otherwise, the plan would be forced unwillingly to into providing QJSA and QOSA benefit forms.

I thought that all employers (that offer medical coverage) must begin to offer to continue coverage to children under age 26 (even if not in school) by 9/23/2010.

However, an HR rep. told me that companies that self-insure (under ERISA) do not have to offer this new coverage until 1/01/2011. Is that correct ?

so now the new 5500-EZ asks the following:

Is this a defined contribution plan subject to the minimum funding requirements of

section 412 of the Code?

the plan is a money purchase, amended years ago to 0% formula.

so is the answer yes, and minimum required is 0

or is the answer no, since the formula is 0% and therefore there is no required contribution.

I really don't know why I thought this, but for some reason I had always thought that the EZ filings were not open to public inspection. But according to the 2009 EZ instructions on Page 2, they are open to public inspection. Just not on the internet.

So what's the advantage to an EZ if you are over the $250,000 filing cutoff, other than perhaps making it a little more difficult for someone to obtain the information?

Can anyone point me towards an authority regarding the treatment of an intentional ESOP loan default as a prohibited transaction?

Thanks!

A defined benefit plan is being terminated in a standard termination. Recently, the sponsor purchased the annuity contracts for all of the participants' and existing alternate payees' accrued benefits. The sponsor will soon file the PBGC Form 501 certificate.

A few days ago, the sponsor received a entered QDRO for a participant dividing his pension benefit in a separate interest. The sponsor learned of the QDRO only at this time. Other than timing, the QDRO meets the requirements for approval.

Is this QDRO too late to be honored? Must the annuity contract provider honor the QDRO?

I've had no luck with commentary, or DOL/PBGC guidance on this issue.

Thanks.

We have a cash balance plan that started in 2008 - 12/31/09 is the 2nd year and the contribution amount was $215,000.00

that represents the 2.50% to non-highlys and 36% to the owners. There was some interest credits for 2009.

The file says the maximum amount of contribution is only $206,000.00. I know it is because of the interest that was credited.

Can they still contribute the Target Normal Cost at Risk - which is still the $215,000.00? Or will they be overfunded in the contribution?

They want to stay on top of the funding and not get behind and underfunded.

Thanks

A terminated employee has an outstanding loan. They elect to leave their account balance in the Plan and not take a distribution.

How do I handle the outstanding loan balance.

Is it Deemed or Deemed with Offset?

Can you explain both options?

A client failed the adp test for plan year ending 09/30/2009 and has not yet been issued a refund (plan is on extension to file the form 5500). What is the penalty and interest that must be added to the refund? Thanks.

If a nonprofit top-hat 457(b) fails to amend for new legislation (i.e. HEART Act) is there a correction method? It looks like submitting to the IRS outside of EPCRS using EPCRS correction methods is only open to govt plans. What are the consequences of the 457(b) top-hat plan falling out of compliance. Become a 457(f) plan? Would it be all assets or just those contributed while out of compliance?

Thanks

If I am merging a money purchase plan into a profit sharing plan (Believe it or not....there are still some out there), do you typically freeze it first and then merge?

I am trying to figure out if a prototype document would be able to be amended to add a provision for the contribution of unused PTO (under Rev. Rul. 2009-31) and keep its prototype status. Normally under Rev. Proc. 2007-44 the good faith amendments have to be for issues related to qualification. I am just not sure if this falls under that, or if a prototype would have to wait for the next restatement cycle before adding this provision without risk of becoming an IDD. Any thoughts would be greatly appreciated.

Thanks

Not sure why, but client does not want to withhold and contribute 401k dollars out of bonus payments. The bonus dollars paid are not significant in amount.

Does anyone see a problem with the administrative procedures relating to elective deferrals providing that no deferrals will be made from bonus amounts?

Thanks for your help.

Our 401(k) Plan transitioned to a new provider a year and half ago. We did not update our IPS at that time. I am recommending that we update it now using the prototype document provided by the current independent advisor attached to the Plan. Our CFO wants to know who should sign the IPS. We have an Investment Policy Committee composed of the President of the company (who is also the Plan's Trustee), the CFO, the VP HR and myself (Benefits Manager). Should all sign? Just the Trustee?

Thanks for your guidance.

If a plan has a different compensation for salary deferrals and safe harbor matching, how is the basic safe harbor matching calculation performed? For example: Using the following information, what would the deferral percentage to match be?

Gross compensation for the plan year of $25,000

Deferrals of $1,250

Deferral compensation was W-2 wages plus deferrals

SHMAT compensation was only W-2 wages

A client forwarded me a memorandum from the National League of Cities summarizing the PPACA? It contains the following bullet item:

"Local governments that self-insure must, after two years, demonstrate to the Secretary of Health and Human Services that their self-insurance plans are sufficiently funded or capitalized to cover all likely medical claims."

A Google search shows various permutations of this always in connection with state and local governments (but perhaps the principle applies to all self-insured plans).

I cannot find anything close to this in the new law, whether for local governments specifically or for self-insured plans in general. I imagine, if the PPACA contains this requirement, it would be a really big deal.

Can anyone shed any light on this? What the heck am I missing?

Employer has had db plan since 2003. Employee met eligibility and was active in db plan in 2003 and 2004. Left.

Employer adds PS plan in 2006 with 1 yr eligibility.

Employee is rehired April 2008

I believe employee is immediately eligible in the db plan.

What about the new ps plan?

If an employee with an IRA passes in the year they are to turn 70.5 but before they actually turn 70.5 and before the RBD (required begin date that is April of the year following the year of passing) is there a RMD for the benneficiaries?

or will the IRA pass to the benneficiaries who will use their life expectancy for RMD and not be required to take the RMD until they turn 70.5?

I have a one participant plan who is not eligible for 5500SF for 2009 and of course not permitted to f ile 5500 for 2009 so a 5500EZ is required.

I don't have a form 5500 software program so my understanding is that I need to contact the IRS and have them deliver paper copies of form 5500ez.

If I am not mistaken I would have to either hand write or type to complete 5500ez, i.e. I can't complete it on the computer.

Is that correct? Is it really that primitive? If so it feels like 1968. Perhaps I should light up a cigarrette when completing the return too ;-).

Thanks.

I have a plan that signed a standing election to apply the carryover/prefunding balance to the extent necessary to meet minimum funding. The election was signed on September 3, 2009. As of what date do I apply this election to the carryover balance for the 2009 valuation and the reduction in the balance - 1/1/09, 9/3/09 or 9/15/2010?