How are you getting Schedule SB data into your software? Are you uploading an XML file provided by the actuary or are you typing in the information from the pdf of the signed schedule SB?

I'm an actuary using Relius and Relius can't create an XML file of JUST the Schedule SB yet, but I'd prefer to provide that since I have more control over it (and it's easier to upload data than to re-type it all and have it proofed.) I think other providers (not Relius) have XML file creation and upload and so does IFILE, so I'm trying to figure out if Relius just missed the boat on this.

We are qualified plan TPAs and I have been asked by one of my clients to quote on and/or take over the admin of their 125 plan.

Is there any testing other than the Section 125 eligibility test; the Section 125 Key Employee Concentration Test; and the Section 125 Contributions and Benefits Test?

Are these also the tersts that are performed on a premium-only plan.

Thanks.

Posted several plans through Web Client and they went through fine with the message "Filing Received." The last two we have posted did not come back in Web Client with that message but say "Processing Stopped." (Both indicated errors with the signatures but we know that both were ok). We checked the DOL website and BOTH OF THESE PLANS ARE RECEIVED AT DOL! Are we finished? I think so! I think the "Processing Stopped" error message we received on Web Client is bogus. I would REALLY like for Web Client to tell me "Filing Received" but my status history in both plans shows "Stopped" as the last status. Anyone else seen this?

Assocaite received $50,000 in compensation in error. The associate is now being termed and the company is pursuing collections.

There were deferrals on this ineligible compensation. If the compensation is recovered, do we reverse the deferrals accordingly? What if the associate has distributed their account and there is no way to back out the deferrals? Is the plan at risk because there are ineligible deferrals in plan?

Are Non-ERISA Church DB Plans subject to top heavy??? Thanks.

In 1965, aged 90 years and with no heirs, Jeanne Calment (1875-1997) signed a deal to sell her former apartment to lawyer André-François Raffray, on a contingency contract. Raffray, then aged 47 years, agreed to pay her a monthly sum of 2,500 francs until she died. Raffray ended up paying Calment the equivalent of more than $180,000, which was more than double the apartment's value. After Raffray's death from cancer at the age of 77, in 1995, his widow continued the payments until Calment's death at age 122.

A certain fund platform does not allow deductions from the participant accounts to pay for transactions such as loans or in-service withdrawals or distributions. A client on this platform does not want to pay our (very modest) fees for these transactions, feeling they should be borne by the participants. Fund company suggests that the client ask the participants to hand in a personal check with the completed distribution forms.

Logically, this doesn't seem very different than deducting the fee on the way out of the plan, but has anyone been doing this? Is there any formal or informal regulatory guidance? What kind of up-front noticing do you give to the participants? I was thinking just an additional line on the Expense Policy.

And, yes, I suggested that the client might want to change fund platforms if they feel this strongly about it...

Thanks!

The first Social Security recipient

• Ida Fuller retired in November, 1939

• Received the first check in January, 1940

• She contributed $22 in taxes from 1937 through 1939

• Her first check was for $22.54

• Ida Fuller died in December 1974

• She lived just over 100 years

• In that time she collected Social Security payments totaling $20,944.42

Does anyone know if the Form 5558 extension has to be "attached" to the Form 5500 electronic filing with EFAST-2. Or is mailing to IRS sufficient. Thanks...

A salesman is trying to sell a friend of mine this idea.

That he can roll his IRA into a Profit Sharing Plan (this will need to be set up), then use the funds in the PSP to purchase life insurance (1 premium payment), and then an Irrevocable Trust can purchase the life insurance from the PSP (at its FMV). Thus, very little is left in the retirement plan to be subject to estate taxes and income taxes, and the life insurance pays out to the ILIT and avoids estate taxes.

To me it seems like a blatant tax shelter that the IRS would be all over, but just wanted to see if anyone had heard of this strategy. The strategy around it is fairly legitimate from what i can tell as they quote revenue rulings to value the life insurance, etc.

Any input is appreciated.

Hi all,

Looking for solid information to backup/prove wrong an assumption. Situation is: person laid off, went on COBRA, is rehired within the same plan year. Question is, becuase there was no break in coverage (significant or otherwise), shouldn't the employee's accumulators continue/remain rather than be reset? For instance, if the employee had already met $400 towards a $500 deductible, shouldn't that accumulator stay as is? OR, when s/he re-enrolls in the plan as a new hire, would s/he have to start at $0 having been met towards the deductible?

My assumption is because 1) it's the same plan year, 2) there was no break in coverage due to continuance through COBRA, and 3) in the same scenario you wouldn't have to meet a pre-existing condition clause again, the same would be true of accumulators (whether deductibles, OOP Max, co-ins max, etc.).

The plan document is silent other than to state a rehire will become eligible on the first of the month after re-hire. I cannot find any info. in the EBIA COBRA manual to backup my assumption.

Any input would be appreciated. Thank you!

I am reviewing a takeover plan and found this weird phrasing... (maybe it's not so weird, but the first time I saw it).

"The "Applicable Interest Rate" means the annual rate of interest on 30-year Treasury Securities determined as of the first day of the Plan Year during which the Annuity Starting Date occurs."

Do I take that to mean that there is a zero month lookback? Is that even allowed?

or does that mean December's rate, because the 30-year isn't published until mid January?

I think I printed a copy of the Senate version before Obama signed it. Towards the end, there was a section titled Section 315 Transition Rule for Certifications of Plan Status. Section (b)(2) of this section said if you wanted to change a past certification as a result of the new law you had to do so within 75 days after the enactment of the Act.

I printed the CCH version after it was signed, which was labeled Senate version as approved by the House and signed by the President; however, this section seems to be gone.

Did they delete the 75 day requirement before it was signed?

Error Msg when filing via Relius Web Client

Details of Plan are:

Fully Insured, Welfare Plan, LTD Plan

Beg. Yr Head Count: 512

End Yr Head Count: 0

Company acquired. Plan terminated on last day of Plan Year 12/31

Premiums paid out of company general assets

Part 1, B checked Final Return -

This is the message I get.

Fail when Form 5500, Line B (Final Return) is checked, unless "termination" criteria (Bypass-T) is set or (Form 5500 Lines, 9a(2) and 9b(2) are checked and line 6f equal zero) or (Form 5500, Line 8a contains "1H").

What is Termination Criteria (Bypass T). There are no assets., under a fully insured plan, the insurance company pays all claims that incurred prior to 12/31...

Does anyone have any ideas for how to design around a noncompete requirement? We want to set payment trigger as 3 years after termination of service, but full benefit is forfeited if participant violates noncompete clause in employment agreement.

I was surprised to find new LRM's for Traditional, Roth, and SIMPLE IRA's on the IRS website. They are effective June 2010.

http://www.irs.gov/retirement/article/0,,id=97182,00.html

(scroll towards bottom of the page).

Although these were long rumored (and it is assumed new model IRA plan documents will follow), I haven't read or heard anything about these being released. I'm curious if anyone has seen or heard of the LRM's being released from either IRS notifications/newsletters or any industry-type groups? I like to monitor these developments and want to be sure I'm tapped into the best resources for these types of things going forward. Thanks!

Plan B is merging into Plan A. Plan B allows in-service distributions from all vested accounts upon attaining age 59½. Plan A does not allow any in-service distributions. None of the current Plan B participants have attained age 59½.

Generally, in-service distributions are a protected benefit. The regulations allow the elimination of protected benefits with respect to benefits not yet accrued. Since none of the Plan B participants have attained age 59½, can the in-service distributions be eliminated in the merger of plans on the basis that this benefit has not accrued for any of the Plan B participants?

I am preparing a late Form 5500 filing (2007) and using Relius Web Client. This is a Defined Benefit Plan. I understand that I use a 2009 Form 5500, 2009 Schedule I. Also we prepared a 2007 Schedule B and Schedule R (both schedules as an other attachment using a .pdf file).

When we tried to file (can sign as service provider), it came up with the following errors:

"ERROR Fail when Filing Header, Form Year does not match Filing Header, Plan Year Begin, unless the Filing Header Prior Year Indicator is set to 1."

This error I do not understand. Any thoughts?

"ERROR Fail when Schedule SB is not attached and Form 5500, Line 8a (Pension benefit code) contains 1x (defined benefit), and either Part II of Form 5500, Line 9a(2) is not checked, or Line 9a(2) is checked and at least one of Lines 9a(1), 9a(3), 9a(4), are also checked, and Schedule H/I, Line 5a is not yes and Form 5500, Part I, Line A, single-employer plan or multiple-employer plan is checked."

I did not check the box at the bottom of the 2009 Form 5500 that a Schedule SB was attached since it's a 2007 Schedule B and its filed as an other attachment to the filing. Line 8a has 1A and 1G, Line 9(a)3 is checked, Schedule I, line 5a is No and Part I, Line A (single employer) is checked. Any thoughts?

I have an incident at Relius but thought I would ask the board.

Another note: these errors did not come up when I originally tried to file. I filed and then it had a submission failed. I tried again and then it came up with the errors when I tried to e-file again. When do these validation errors first come up?

Physicians group has two plans Safe Harbor 401(k) and Money Purchase. Yes, they have been told to terminate the pension plan in the past, but "liked the investments". Now that medicare has cut their payments by 21% and possibly more, they are scrambling. They are having a hard time paying rent, much less the $437,000 contribution receivable that is due for the plan year ending 12/31/09.

Going forward would a good course of action be to issue a Section 204(h) notice asap, freeze the plan, therefore limiting their 2010 plan year funding for the date the freeze took affect? They will have to fund based on comp paid to eligible participants up to that date. They could then rollover the assets into the Safe Harbor plan or merge the plans?

For 2009 I believe there will be a 10 percent excise penalty involved on the UNPAID amount if they can not fund the plan by 8 and a half months after the plan year(Sept 15). I assume a lot of physicians will have problems due to the new medicare cuts. This particular plan has 51 participants. Has anyone had problems with pension plan funding? Do you think these reasons would be reason to apply for a waiver? Probably not. And I would assume the plan could not be merged with the Safe Harbor until the funding was made?

How is the value of employer stock calculated during diversification? Specifically for a publicly traded plan using internal accounting and not necessarily going out to market. Is it the price/value as of the last day of the plan year? Or is it based on the day the diversification is completed?

I know the 25% - 50% limits, but am not sure about the dollar value assigned. Any help is appreciated!!!