Does anyone know how to export into an excel format a report that reports employee name and SSN, and ending balance per participant per source of money? We want the sources in columns and then each row represents a participant.

thanks.

Testing a DB plan for 410(b) using the Average Benefits Test which for the ABT is combined with profit sharing allocations. Want to impute permitted disparity. Happen to be testing on an allocations basis (but that should not matter for this question).

The Plan years differ so the allocation rates are being separately computed and added together. Is permitted disparity imputed on one of the plans and then the two are added together, or are the allocation rates first combined, then permitted disparity imputed?

I thought it could be done either way but 1.401(a)(4)-9(b)(2)(iii) seems to say that if you choose to impute, you must impute on the aggregate allocation (or accrual) rate. That does not make sense to me. It seems like you're integrating two plans. Plus, how do you inpute one aggregated allocation rate if you have two sets of testing comp?

Opinions?

P.S. Said another way, what does 1.401(a)(4)-9(b)(2)(iii) say, and why?

I really thought this would be an easier issue than it's turning out to be, but here are some generic facts for an issue being faced by a few of my clients:

Assume a fully-funded cash balance pension plan is being terminated for the appropriate business reasons. Can the cost of the distribution process only (not the valuation process) be allocated among the individual participants' hyponthetical accounts? I have one TPA who is taking this approach and an unrelated TPA (for an unrelated client) who is questioning this approach.

Does it matter whether the Plan is subject to the PBGC?

Does it matter whether the allocation of cost is pro rata among all partiicipants or in proportion to each participant's hypothetical account balance?

I would appreciate any type of guidance anyone might have.

What is the most typical method for correcting a plan's failure to list recently acquired subsidiaries among the list of predecessor employers for which service is credited for vesting purposes? For example, company forgot to timely amend its plan to list a company acquired in 2006 among predecessor companies for which the plan recognizes years of service. Can the plan simply amend the plan retroactively to recognize this past years of service since this is all for the benefit of participants (and actually consistent with the plan's administration) or does this have to be done as a restroactive amendment through EPCRS?

Plan has a pay-period match and for wahtever reason does not want to be bothered with setting it up on payroll the right way to get the match to calculate including Roth.

So they want to NOT match on Roth 401(k). I know, I know, it's ridiculous, but that's what they want to do. Note also that based on who is deferring Roth, benefits rights and features are passed with no problem at all.

Is there any sort of rule that requires Roth and traditional 401k to be treated the same way under the Plan?

From 402A (is this expansive enough to mean that Roth must always be treated just like elective deferrals?)

(a) General rule

If an applicable retirement plan includes a qualified Roth contribution program—

(1) any designated Roth contribution made by an employee pursuant to the program shall be treated as an elective deferral for purposes of this chapter, except that such contribution shall not be excludable from gross income, and

An employee being laid off wants to reimburse the company for a large claim(s). Sounds suspicious to me, as if the company might not be communicating her rights. So I will probe a little further. However, are there procedures or rules to handle such things? What if the employee truly wants to reimburse because she doesn't feel good about taking more money than she's contributed? Should I simply recommend to the company that they tell her to keep it? What if the claims turned out to not be legit and the money is already reminbursed? Can the company expect to be reimbursed?

Group of employees is eligible for a profit sharing contribution. It is a new comp plan with each participant in his/her own class. Can the employer allocate the PS contribution based on each participant's deferrals? Seems like no since this would "coincidentally" basically be a match. Anyone have a regulation citation forbidding this? Thanks.

Our plan was amended to permit deferrals prior to statuatory entry. 2008 was the first year. We elected to separately test OEs (under age 21, less than one year at the immediately prior entry date or covered by a collective bargaining agreement).

I remember learning that "no one is an HCE in the first year of employment except 5%+ owners."

I don't think that will prevent us from having OEs who are HCEs. An employee hired in Sept. 2008 and earned $150K in 2008, has a statuatory entry date of 1/1/2010, and will be an OE NHCE in 2008 and an OE HCE in 2009. Right?

Based on other threads and comments I believe my options are to test the OE HCE with the OEs or include the OE HCE in the regular testing group. Is that still correct under current regs.?

Thanks!

My issue is that I have two terminated participants that received a 5% QNEC in order for the plan to pass the ADP Test. The plan is also cross-tested, has individual allocation groups, and requires a participant to be actively employed on the last day of the plan year (no hours requirement). Assume the Gateway minimum is 5%. Must these participants receive an additional 5% under the plan's non-elective provision, or does the 5% QNEC cover the Gateway? Does it matter if one of the terminated participants has less than 500 hours of service (if I exclude from the General Test do they receive the Gateway).

I've read several threads on this topic (the more recent ones differ from the earlier answers), but besides the IRS Q&A comment at the 2006 ASPPA Conference I could not find anything definitive. The issue has arisen because I just read a newly restated EGTRRA VS document and there is a paragraph under the Gateway definition which clearly states that QNECs can be used to offset the Gateway minimum requirements.

Any thoughts would be appreciated.

I know you cannot have an HSA and FSA at the same time, but can you have one and then the other within the same calendar year?

For instance, say you start an FSA toward the begining of the year and then stop it at say September. Then, during an October HDHP renewal date you enroll in and fund an HSA. Seems like this should be possible.

I appreciate any opinions.

If a plan includes all employees, and then later wants to exclude a class, say per diem, is there any problem? Plan can be amended, but since eligibility and job class is not a protected benefit I do not see a problem?

What happens if an individual works for City A for X years and does not defer the maximum, then terminates with CIty A and goes to work for City B. CIty B has a 457b plan and the employee who is age 62 and 3 years before NRA under this plan wants to participate and defer the maximum - $16,500 plus unused limits - unsused limits from the prior employer plan or just this new plan (obviously there are no unsused limits as he was just hired)

Thanks!

Ok, here's the situation...

A law firm has 2 owners. 1 owns 99% and the other 1%. The 1% owner of the law firm is now starting his own law firm (100% owner). Obviously, not a controlled group issue. However, he will work for both law firms. His own law firm will have his own clients and not be doing business exclusively for the other law firm (so no affiliated service group as far as I can tell). Suggest a multiple employer plan, right?

The question came up as to who has to make the employer contribution? Can it come from either? A combination of both? Or does it have to be attributable to the participants under each company (i.e., each company pays their own)?

Any help you give me would be greatly appreciated!

THANKS!

My father passed away in 2008 and my brother and I were both 50/50 beneficiaries. We both opted to rollover the accounts rather then take a distribution.

As it turns out my advisor (Morgan Stanley) did not roll it over to a Death Benefit IRA but into a new IRA with my name. They then rolled over an old 401k plan into that same account in 2009. Well, i know in 2009 I did not have to take a RMD but would in 2010.

They are looking into seeing if the can separate the two accounts and re-setup the original account as a Death Benefit account that is not in my name but reflects that it is a death benefit rollover. They said it was some sort of back office coding problem.

I am a bit nervous that the IRS will see this a distribution and I will not only have to pay taxes on the distribution but also pay income taxes even though I have not touched a dime.

Any help is appreciated.

Thanks,

Mark

Has anyone seen a good discussion or any guidance on what makes a business associate an agent vs. an independent contractor under the HIPAA breach notification rules? I know that the preamble is replete with references to the federal common law of agency, but that is a huge field. The Restatement of Agency focuses on the right to control the actions of the business associate, which in the agreements I have seen is almost never present. I mostly work with group health plans, and the last thing they want is control over the business associate--performance standards, yes, but not control over performance of services.

On the other hand, many of these business associates are held out to participants and beneficiares as authorized to act on behalf of the plan, e.g., EAP provider, third party claims administrator, COBRA administrator. Is that sufficient to make them an "agent?" That's different from the control test--they are acting on behalf of a disclosed entity, but does not fact make them an agent?

I'm interested in other views on this question. Thanks.

I have a plan that has 1 year of service, date-of-event entry dates for deferral & Safe Harbor. For Profit Sharing it is 1 YOS and semi-annual entry date.

Compensation used for each source is that earned while a participant in that source. So, I will be having different compensations for SH and PS.

My question is, which comp do I use in my gateway and average benefit tests?

Say, for example person makes $60,000 in the year. She enters the plan for SH on 4/1, and makes $45,000 from then, and $30,000 after 7/1, when she was eligible for the PS. Her SH will be 1,350 and her PS will be 450 (gateway is 4.5%). But when I run my tests, what comp should be in there? Her 401(a) allocation % would be 4% using the 4/1 comp, and 6% using the 7/1 comp.

If an ESOP permits participants to diversify 100% of their account prior to becoming a qualified participant under Code Section 401(a)(28)(B) and a participant elects to do so, what consequences could there be once the participant becomes a qualified participant upon attaining age 55? See below for background and some hypotheticals to introduce the question in more detail.

Background

A client is considering amending their stand-alone ESOP (no outstanding loans and no active contributions) to permit all participants to diversify their entire account balance invested in employer securities by transferring the portion the participant elects to diversify to the client's 401(k) plan, which is subject to ERISA 404©.

Notice 88-56, A-11 generally permits excess diversification (diversification of amounts beyond what is required pursuant to Code Section 401(a)(28)(B)), subject to certain stipulations. Specifically, the excess diversified amounts are not treated as (i) available for diversification or (ii) diversified pursuant to Code Section 401(a)(28)(B). A simple take-away from this is that a participant would still be entitled to receive a distribution in the form of employer securities pursuant to Code Section 409(h) of the excess diversified amounts. This is not a concern. We are, however, somewhat concerned about a different situation.

Hypotheticals

In this regard, let me propose two hypotheticals. For both hypotheticals, assume that all shares in the ESOP are post-86 shares and that no contributions or dividends have been made for the past 10 years.

Hypothetical 1: Participant A has 100 shares in his account and is 50 years old and has never had more than 100 shares of employer securities in his account. Participant A elects to diversify 10% of his account (10 shares). The cash value of such shares are transferred to the 401(k) plan and invested pursuant to the participant's investment elections in the 401(k) plan. When Participant A attains age 55 he becomes a qualified participant. Since the 10 shares he previously diversified are not treated as available for diversification or as diversified, the participant is still entitled to diversify 25% of the 100 shares that were previously in his account. Accordingly, Participant A is now entitled to diversify an additional 25 shares and elects to do so, thereby bringing his total diversified shares to 35 (25 of which are diversified pursuant to Code Section 401(a)(28)(B) and 10 of which are an excess diversification).

Hypothetical 2: Participant B also has 100 shares in his account and is 50 years old and has never had more than 100 shares of employer securities in his account. Participant B elects to diversify 100% of his account (all 100 shares). The shares are sold and the cash is transferred to the 401(k) plan and invested pursuant to the participant's investment elections in the 401(k) plan. When Participant B attains age 55 he becomes a qualified participant. Since the 100 shares he previously diversified are not treated as available for diversification or as diversified, the participant is still entitled to diversify 25% of the 100 shares that were previously in his account. Accordingly, Participant B is now entitled to diversify 25 shares. Participant B, however, does not have any shares in his account because he previously elected to diversify the entire balance of his account. In this hypothetical, can the administrator re-classify 25 of the previously diversified shares as diversified pursuant to Code Section 401(a)(28)(B) with the remaining 75 as excess diversification? Or, is the amendment permitting 100% diversification a qualification failure with respect to Code Section 401(a)(28)?

Any thoughts would be appreciated. Thanks.

Hi I am looking for information concerning concurrent individual and group LTD policies. What kind of limits are placed on benefit payout if an individual has both group and indv. policies in place? Is there any important factor in regard to which policy will begin payout first?

I am interested in referencing sources of this material if anyone has any suggestions.

THANKS.

A company laid off workers in Dec 2008. They have a policy that is the employee is not rehired within 90 days they are considered terminated and give a termination date at that time. I have about 10 partipants that are in this state. They have March 2009 termination dates, no hours, no compensation for 2009. Since they could not defer since they didn't work, can I keep them out of the test or do I have to put in with zero compensation?

Thanks

Pat

A company laid off workers in Dec 2008. They have a policy that is the employee is not rehired within 90 days they are considered terminated and give a termination date at that time. I have about 10 partipants that are in this state. They have March 2009 termination dates, no hours, no compensation for 2009. Since they could not defer since they didn't work, can I keep them out of the test or do I have to put in with zero compensation?

Thanks

Pat