A pdf of an SB that is signed or initialed must also be embedded in the xml transmitted to IFILE (at least that's how I'm doing it). Must the pdf of the SB include all of the attachments (plan provisions, assumptions, age/service array, etc.), or do we simply embed the first 3 pages of the signed/initialed SB?

Long live the memory of Bob Sheppard, tireless Yankees no-nonsense PA announcer.

http://www.nytimes.com/2010/07/12/sports/b...=1&emc=eta1

Tom Lauricella's January 31, 2010 article in the Wall Street Journal entitled "Social Security Payback Pays Off" is worth a read. It describes a little known Social Security law. This provision offers pensioners who say retire at age 66 the option to repay at age 70 to SS all of their gross SS payments without interest and to have their pensions recalculated with the delayed benefit increase. Also, they receive a credit for the income taxes they may have paid. The catches are you need to come up with the cash and then you need to have a long life after 70.

http://online.wsj.com/article/SB126489831806038027.html [this came up through Google]

When a DB plan is terminated, can a 401(h) separate account continue to be administered to pay future retiree medical benefits as they occur or must there be some tyoe of disbursement of that fund at the time that the pension benefits liability is settled by, presumably, purchase of annuities?

We are a TPA firm and have a number of clients that did NOT authorize us to sign the 5500 return on their behalf (they don't want their signature on the www). So these clients have obtained their signing credentials, we've uploaded their 5500 & schedules to the DOL website, and the clients have signed the form 5500 electronically. As TPA, are we allowed to transmit / submit the filing to the DOL once the form has been signed or is the client responsible for doing this?

We just took over a plan that looks like has been filing under a fiscal year end of 1/31 and not 12/31 as the document states. I am researching if there were any amendments or such. Is the only way to correct by going back and amending the plan year end on all the 5500 with the incorrect date? I know I am way to optimistic about an easier way....

Thanks!

A 100% ESOP-owned S-Corporation would like to prepay its 10-year ESOP loan that matures in 2014. The S-Corporation also has a 401(k) plan. Two participants have already had their ESOP benefit curtailed in prior years due to the 415 limit.

If the S-Corporation prepays the remainder of the ESOP loan in one contribution to the ESOP, the remainder of the ESOP shares in the suspense account will be allocated to participant accounts in accordance with the plan document.

Can anyone confirm that the participants who normally hit the 415 limit in a plan year will not be permitted to share in this allocation of remaining shares resulting from the loan repayment due to the application of the 415 limit? If so, I understand that some additional participants may also hit the 415 limit due to the additional allocation of shares resulting from the prepayment of the ESOP loan and will also be prohibited from receiving an allocation of these shares once they hit the 415 limit. Is there some way to prepay the ESOP loan and not be impacted by the 415 limit?

Are there any other issues related to prepayment of an ESOP loan, other than the application of 415? All of the loan documentation permits loan prepayment without penalty.

Thanks.

A 100% ESOP-owned S-Corporation has been asked by former employees to make distributions from its leveraged ESOP before the ESOP loan matures in 2014. The plan document does not require payment until the end of the plan year following the plan year in which the ESOP loan matures. The plan document further provides that distributions may be made in cash or stock, in the sole discretion of the ESOP trustee.

(1) Can an S-Corporation defer distributions until the ESOP loan matures? I know that it is permissible for a C-Corporation to delay distributions, but I read an article that stated that distributions may not be delayed for an S-Corporation, but there was no citation of authority for the statement.

(2) The S-Corporation plans to contribute to the ESOP sufficient cash to fund the distributions. Will the contribution of cash be considered a distribution from the S-Corporation (rather than an ESOP contribution) to the 100% owned ESOP? Will this funding result in the allocation of shares from the suspense account to participant accounts, just as it would for a loan repayment made to the ESOP?

(3) If the ESOP Trustee makes the distributions in the form of stock rather than cash, is there capital gains treatment which would be more advantageous to participants when compared to a distribution in cash? Does the capital gains treatment apply all shares that are distributed? I read somewhere about capital gains treatment applying to a portion of a distribution and it wasn't clear if the portion not eligible for capital gains treatment was due to fractional shares being paid out in cash, or if the capital gains treatment was only available for a portion of the stock distributed.

(4) If the ESOP Trustee distributes stock, subject to a put option, and the S-Corporation buys back the stock, does the S-Corporation contribute the treasury stock back to the ESOP so that the S-Corporation continues to be 100% ESOP-owned? Does this contribution of stock result in an allocation to participant accounts equal to the FMV of the stock contributed?

I appreciate any information that you can provide.

After many completed filings, my last 3 clients all received 'Submission Failed' messages.

Anyone know what that means? No other description was given. The 'Help' in RGF indicates I should contact Technical Support.

This has been discussed out here before, but I am curious to know if anyone has actually split 1 plan into to two for the purpose of avoiding an audit. Has anyone actually done this? Has it ever been scrutinized by the DOL.

I putlled this from TAGData, who pulled it from an ASPPA Q&A session.

the question was raised at the 2000 annual ASPPA meeting, in the general Q&A session. The questions at this session were answered by Joe Canary, Scott Albert, Lou Campagna and Mabel Capolongo of the Department of Labor:

Question 5: A 401(k) plan has 150 participants. The plan must file a full 5500 and have an audit by an accounting firm. Due to the cost of the audit ($10,000 or $15,000), my suggestion to the client is to split the plan into two plans, each with 75 participants. For 2000 there will be an audit. The plans could be split into two plans on December 31, 2000. Therefore, on January 1, 2001, both plans have less than 100 participants and no audit required. For tax qualification testing, they can be permissively aggregated. In fact, my plan is to administer as if it was one plan and just separate for 5500 purposes. Is my conclusion correct?

Answer: This question raises issues of avoidance and evasion. It is not certain that you really have two plans for purposes of Title I of ERISA in this instance--even if there may be two plans for Internal Revenue Code purposes. In Advisory Opinion 84-35A, the Department stated it would consider, among others, the following factors in determining whether there is a single plan or several plans in existence: who established and maintains the plans, the process and purposes of plan formation, the rights and privileges of plan participants and the presence of any risk pooling, i.e., whether the assets of one plan are available to pay benefits to participants of the other plan. This Advisory Opinion also notes that the Internal Revenue Service has cited the existence or absence of risk pooling between funds as relevant to the determination of single plan status. See §1.414(1)-1(b) 26 C.F.R. §1.414(1)-1(b). In DOL Advisory Opinion 96-16A, the Department stated its position that whether there is a single plan or multiple plans is an inherently factual question on which the Department ordinarily will not opine in the Advisory Opinion process.

Client insists that they filed their 2007 5500. IRS sends out a notice saying the filing was never received. The first thing we do is respond saying, no it WAS filed, and here is a copy of the filing. They then respond and say, you need to efile this 2007 return.

What are people doing at this point? Fighting with the governemtn to convince them that it was filed? Or doing the efiling/DFVC program? At the end of the day, sicne this goes back 2 years, I can't see how anyone could say with absolute certaintly that it was filed (client does not have return receipts). I've been taking the cautious route saying that a known $750 is better than an unknown $15,000.

Also, now that they are asking us to efile, I think we have less basis for then going back and using the DFVC.

One person plan terminated but is underfunded by about $300,000. Should the Form 6088 show the total calculated PVAB? Or should it show the PVAB to the extent funded (i.e. $300,000 less than the actual PVAB). Is there any guidance on this issue someone could point me to or has anyone experienced this before?

The new funding relief provides a 2 and 7 rule or the 15 yr amort rule.

The question is:

Say the rellief is used for a 2009 cal yr plan.

Does this relief apply to a new amort base or does it apply to the entire funding shortfall including bases established in 2008?

my impression is that you take the entire shortfall and apply it and not just the new base.

thanks

I have a client whose father had a Fidelity Keogh. The father died in 2002 after beginning his RMDs, and Fidelity moved the money into two accounts for the two kids/beneficiaries and titled the accounts inherited profit sharing plan in each of the childrens' names. Of course there is no document to go by and no 5500s have been filed, but in finding a place to start I wanted to understand if this type of a plan is even available, especially since there is no plan sponsor and the only activity has been RMDs.

ok - I thought there were threads about this but I searched and came up empty...

I submitted a client's return through IFile. The client obtained the necessary credentials and went in and signed the filing for me. I went back in and submitted the filing.

When I submitted; the filing showed as "Filing_Stopped". The form IS showing up in a general 5500 search on the EBSA home page.

Attached is the filing error I received. The client has assured me that he registered as a "Filing Signer" and that he completed the registration process through getting his User ID and pin.

Any thoughts?

DOC070810_001.pdf

Soleproprietor has a MPPP. Owner/proprietor is the only participant.

Owner does not want to contribute for current plan year. I told him that he must contribute 10% because it's a MPPP and the adoption agreement requires a 10% contribution each year.

Does the fact that he is the only participant allow him to avoid having to contribute?

Why should the DOL care if he contributes or not. It's not like some employee participant is going to complain.

The reason I ask, is because I am preparing the Form 5500-EZ. Line 10, requests info about contribution amount if the plan is a defined contribution plan that is subject to the minimum funding requirements of Sec 412 of the Code.

I don't want to falsely claim on the 5500-EZ that the plan is not subject to Sec 412 minimum funding.

Does anyone know if there is some exception to the Sec 412 minimum funding requirement, that might allow him to not contribute simply becasue it is a single owner/participant plan ?

I have a client with a Safe Harbor 401(k) plan utilizing the 3% SHNEC to satisfy the SH requirements. It also has an integrated profit sharing allocation with a last day requirement. Based on the client's request, they will make the 3% SHNEC and they want to make an additional integrated allocation. The integration level is 81% of the TWB. The additional allocation will be 6% of total comp and 5.4% above the integration level. Additionally, there are a number of NHCEs who terminated during the year. They will receive the 3% SHNEC, but not the additional intergated profit sharing allocation.

Based on the above and my understanding, the rules dictate that if both allocations would essentially be design based safe harbor allocations and they had the same allocation requirements (1000 hours, last day, etc.), then no 401(a)4 testing would be required. However, in this case, the SHNEC cannot have any allocation conditions and the integrated profit sharing allocation has a last day requirement. In this case, I believe that I have two options that I can use for this plan:

(1) Component Plans - If I am able to split the plan into component plans (by passing 410(b) for each of the component plans), I could split the group of terminated NHCEs who only receive the 3% SHNEC into one component plan and all of the other participants who receive both the 3% SHNEC and the integrated allocation into the other group. Based on this method, my thought is that the allocations in each of the two component plan groups would essentially be design based safe harbor allocations and no 401(a)4 testing would be required.

(2) Cross Test the Plan - The terminated participants who only received only the 3% SHNEC could have their allocaiton percentages increased to the gateway minimum allocation (permited in the plan doc) and the plan could be cross tested for 401(a)4.

I would like to confirm that the above is correct and that I am able to utilize either of these methods. (If so, I will utilize the first option as it is the more cost effective.) Any comments are greatly appreciated.

A collateral assignment split dollar agreement is terminating due to termination of the employee's retirement. The employer is going to forgive the debt owed (for the premium payments) and release the collateral. I assume a simple document releasing the collateral and forgiving the debt is appropriate, but isn't the collateral assignment filed with the insurance company? Would something need to be filed with the insurer? HELP!

For those of you with an employer contribution based on a profit sharing component, what is the method you use - if the company hits x amount of pre-tax profit you contribute an additional x% to the participant's account? Based on revenue and not profit? Thanks

We have a 403(b) plan that is sponsored by a hospital. They were recently notified by the IRS that their 501©(3) status is being revoked. It appears that under IRC 1.403(b)-10(a)(2) that they can amend the plan to discontinue contributions and "freeze" the plan. If this is the decision they make, can participant loan payments still be made to the plan? Can new loans be made to participants? Alternatively, the plan could be terminated and all the loans would become taxable.