Client wants to terminate ESOP that has been frozen as to new participants and benefits as of 12/1/05. We did not represent plan at that time but have been told that participants were given notice of plan freezing. We would like the effective date of termination to be 12/31/09. What notice to the participants is required? If notice is required what is the required notice period? I have found a lot of discussion about 204(h) notices for DB and MPP plans and plans subject to PBGC rules, but nothing for DC and ESOPs. I was going to just prepare a SMM with the PPA, HEART and WRERA changes and include a notice of plan termination date on 12/15 (15 days notice prior to termination date). Is this sufficient?

We have employees (about 40) who have been enrolled in the HDHP plan since 2007 and 2008 that refuse to open an HSA account. The employer makes contributions on a quarterly basis to HSA accounts. However, for the employees who have not opened accounts, the employer money goes into a general holding account. We continue to send letters and emails to these employees for the past 2 years informing them they must open a bank account. We continue to receive no response. Therefore, we have to go through the process of getting this money back each year since the HSA is considered not to have been established.

Can we send a letter to these individuals stating that if they do not open an account by a certain date, they will not be eligible for the HDHP plan and they will have to choose another medical plan? Is there any IRS (or other) regulation that states we cannot do this?

Plan has semi-annual entry dates (1/1 and 7/1), and a 1 year of service (1000 hrs) requirement. Entry date is following or coincident with satifying the requirements.

If a person was hired on January 2, 2009 and worked more than 1000 hrs in 2009, when would she enter the plan?

I would contend that the one year of service is satisfied on Jan 1, which is coincident with an entry date. Is that correct?

I got an ad for Viagra (of Cialis, or some other crap) today via PM. I did not notice a "report" button. Is there one? Can there be?

I did try to "block" any future PM's from this "person," but the account was no longer active.

Below is a link to the page that contains the syllabus for the EA-1 (in another link within the page).

I am basically starting from scratch here, so I was hoping an Enrolled Actuary can take a look at the texts and recommend an order of reading.

Please help- time is of the essnece as I wish to take the exam in May. Thank You.

http://www.asppa.org/Document-Vault/Docs/EE/EA-Exams.aspx

We have an ERISA 403(b) plan (had employer contributions) that is in the process of terminating. We hope to have it completed by mid-2010. The sole vendor is co-operating with us to get this terminated. There have been no employee or employer contributions for several years. There are around 130 participants. According to Field Assistance Bulletin 2009-02 transitional relief - none of the contracts need to be counted because they meet the requirements below. They are also not counted in the 5500 count. So am I preparing a 5500 with 0 participants and 0 assets?

Any and all thoughts would be appreciated.

"Specifically, the administrator of a 403(b) plan does not need to treat annuity contracts and custodial accounts as part of the employer’s Title I plan or as plan assets for purposes of ERISA’s annual reporting requirements provided that:

the contract or account was issued to a current or former employee before January 1, 2009;

the employer ceased to have any obligation to make contributions (including employee salary reduction contributions), and in fact ceased making contributions to the contract or account before January 1, 2009;

all of the rights and benefits under the contract or account are legally enforceable against the insurer or custodian by the individual owner of the contract or account without any involvement by the employer;(5) and

the individual owner of the contract is fully vested in the contract or account.

Moreover, current or former employees with only contracts or accounts that are excludable from the plan’s Form 5500 or Form 5500-SF under the above transition relief do not need to be counted as participants covered under the plan for Form 5500 annual reporting purposes. "

I'll never understand people who hit the snooze button each morning - especially those who do so more than once.

I mean, I hate to get up in the morning to the alarm clock as much as the next person. Why do it again, and again, and again?

There go those voices in my head again. I can hear them very well. Unfortunately, they are speaking Spanish - of which I know very little, so I have no idea what they're saying........I think they're talking about me.

A plan sponsor has approached us to do an illustration for a DB/DC combination of plans. They had previously met with a firm who discussed with them "backloading" the plans with almost $5 million in contributions to make up for the last 25 years of not contributing. For the life of me I can't remotely think what they might have been thinking about? Does anyone have the slightest idea what they might have been referring to with this comment?

Hi,

I have a plan that all assets were distributed on April 29, 2009. When completing the form 5500 would I use the April 2009 date as the plan year end and mark final & short plan year or use the regular plan year end and mark as final.....

However, since the filing deadline is 7 months after the assets are zero I am thinking the April date for year end is the correct way but would like to her other thoughts...

Thanks,

Jason

Are the 2009 instructions available? I'm not having any luck finding them where I can access it. Previously the participant count instructions have been pretty specific about 401(k) participant counts. I'm looking for guidance on how the 403(b) participants will be counted (same as 401(k)??) so that our auditors can be clear on which plans will need audit for 2009.

Thanks.

Code 411(a)(7)© permits restoration of an accrued benefit if the plan provides the opportunity to repay the full amount of the distribtuion with interest at the rate determined for purposes of subsection 411©(2)©.

I am looking for support that this means 411©(2)©(iii)(I) (120 percent of the fed mid term rate) and not 411©(2)©(iii)(II) (417(e).

Can anyone point me in the right direction? Thanks.

I have seen nothing specific in instructions that refer to 403(b) participant counts for 5500. Is the count based on active eligible employees plus terminated employees (the same as a 401(k) plan), as opposed to participants with balances only?

a two trustee plan has violated the annual addition limits as one participant, who happens to be one of the trustees, received in excess of his 2009 earnings. He refuses to sign off on a refund. Can the other trustee request the refund without the others signature?

Can a plan opt to DO NOTHING with regard to the 2009 RMDs, give no elections to the terminated participants and beneficiaries, make all distributions per plan, permit no rollovers of the RMD amount?

If yes, does the plan have to note that it is following its own rules? If the plan document references compliance with 401(a)(9) is it then obligated to amend even if it does nothing different?

My client annually deposits their 3.0% non-elective safe harbor contribution mid-year in the following year. Can their Plan be amended prior to November 30th, or December 31st, to be relieved of the requirement of putting in any 2009 safe harbor contribution? Thanx.

We're inheriting a 401k/Profit Sharing Plan that implemented the QACA provision beginning 1/1/08 (calendar year Plan) as they were failing ADP in prior plan years and the Plan is also Top Heavy. The 401k Plan has been in place for over 10 Years. Their automatic enrollment feature enrolls participants at a rate of 3% of Comp for the 1st and 2nd Applicable Plan Year, 4% for the 3rd, 5% for the 4th, and caps at 6% for the 5th and any subsequent Plan Year.

The QACA match is the Basic Match that provides a match of 100% up to the first 1% and 50% of the next 5% contributed (max match of 3.5%). However, the Annual Notice states that "No matching contribution will be made on any deferral contributions that exceed 3% of Compensation in the first and second years, 4% in the third year, 5% in the fourth year, and 6% in the fifth and subsequent years." The match limit described here seems consistent with the match that would be associated with the automatic enrollment step-up feature as described in the paragraph above (i.e. the max match would be 2% of Pay for the first and second Plan year where a participant was enrolled at 3% of their Pay).

The question I have is if someone made an affirmative election to defer 6% of their Pay during their first year of participation, based on the match described above, would they be entitled to a 3.5% match or just a 2% Match? The research I've done seems to indicate it would be 3.5%. However, it's our client's understanding that the maximum exposure the Sponsor has for the match for the 2008 and 2009 Plan Year is 2% of Pay, and then this increases .50% for each additional year thereafter (for a cap of 3.5%). They base this on the sentence that I described in quotes in the paragraph above. I can't find anything that says their understanding is wrong, but based on what I've researched, this only applies to those that are automatically enrolled; everyone else that makes an affirmative election would be eligible for the entire match of up to 3.5%. Can someone please clarify this for me?

Thanks!

How are practicioners communicating and interpreting the new PPA requirement that plan sponsors post "actuarial information" from Form 5500 on company intranet sites?

There is very little guidance.

What due date are firms communicating? Are you telling your clients to include Schedule SB attachments? Anybody defining what an intranet is for this purpose?

What are the big firms communicating?

A 65-year-old client who is vested in a union pension plan has applied for his pension and been denied because he holds a contractor’s license. The plan forbids retirees from working more than 40 hours a month in the field (carpentry) and the PA has told him he must relinquish his contractor’s license (the plan doesn't mention this). The PA required our client to submit his 2008 tax records in order to determine how many hours a month he works. The client says 2008 should not matter since he’s retiring in 2009. He understands the work limits and plans to abide by them, but he doesn’t want to give up the contractor’s license (he needs to supplement his small pension). How can he prove he is not violating the rule?

Company A and Company B are within the same affiliated service group and each sponsors its own 401(k) plan. About half the employees of Company A terminated employment with Company A and now work for Company B. Company A would like to get those participant accounts out of Company A's plan. There's clearly no distribution event. However, can Company A transfer the accounts of their former employees to Company B's plan without the participants' consent (assuming Company B is on board with it)?

Also, should we be concerned about a partial termination of Company A's plan even though the employees are employed within the same affilaited service group?