This is becoming a comedy of errors.

We have been contacted by several plan participants who say that the company has been out of business for 2 years and no one can find the sole trustee. However, we have recently received and processed distributions for other participants. Wondering whether someone had actually found the trustee, or someone had forged the trustee's signature, we pulled the plan document to compare the signatures. What we found is that the trustee never signed the document when the plan was adopted.

Any suggestions how to fix this?

I need some help on a COBRA subsidy scenario. I am working on an employment termination/settlement agreement. As a result of the settlement agreement, we are changing the termination date of an employee so that he is now eligible for the COBRA subsidy as the termination has gone from "for cause" so he didn't get his 90 day notice period, to "without cause" so now he gets the 90 day notice period in his employment contract. Employee has been on COBRA since last November and has been paying 100% of the premium. He asked for the COBRA subsidy and we agreed to pay him for the 65% so long as we are eligible to get the credit. I believe that there is nothing that would limit this guy from being eligible for the subsidy and so we could get the credit retroactive to March 1. However, the COBRA administrator is saying that the guy had to complete his COBRA subsidy application and send it back within 60 days of them mailing it to him, which it did back in April, in order for him to be eligible for the subsidy. He didn't complete the application and send it back to them within 60 days. However, if he had, he wouldn't have been eligible for the subsidy back then because his termination date was prior to Sept 1, 2008, at that point. However, I can't find a 60 day limit to complete the application in any law or guidance from the DOL. The only 60 day limit I can see is for persons electing COBRA. This guy was already on COBRA when he received the subsidy application, he was just paying 100%. So, two questions: (1) Anyone know if it is permissible to get the subsidy retroactive to march 1? (2) Anyone aware of a 60 day limit on completing the subsidy application? We don't want to give him the 65% if we can't get a payroll tax credit for it. The CFO doesn't want to claim the payroll tax credit (for documentation/IRS audit purposes) since the COBRA TPA is saying he's not eligible due to not timely completing the application.

Thanks!

For various reasons the plan sponsor wants to pay the $1500 for missing multiple years of filings by cashiers check and not by company check. Will the DOL accept a Bank cashiers check or does it have to be a plan sponsor / company check?

Can a 401(k) Plan ONLY allow for Roth (not pre-tax) deferrals?

Thanks so much!

Please pardon the brain freeze. w/r/t a PPA amendment, are there "PFEA-related" items that should be included?

thnx.

We use the pre-approved corbel documents, and we are coming close to the end of the year, unfortunetly it’s going to be close to impossible for us to get all of our restatements done and signed by 12/31/2009.

If we start using an effective date of 1/1/2010 we know that we have only until 4/30/2010 to have those documents signed unlike having till the end of the year for our 1/1/2009 documents, but what other disadvantages would there be for not having all our restatements done by the end of this year?

Is it true that we still have to have the PPA amendment signed by 12/31/2009, we are currently sending them out with our restatements?

Client's compensation is $200,000 per year

Contributes $100,000 to DB plan.

How much can she add to SEP IRA?

Thanks

Also posted in Defined Benefit forum

Client's compensation is $200,000 per year

Contributes $100,000 to DB plan.

How much can she add to SEP IRA?

Thanks

I have not received an acknowledgement in response to the last 2 reasonable cause letters sent to the IRS. The next thing the client / taxfiler received was a penalty notice. Anyone having similar experiences or know a possible reason that I am not getting responses to my RC letters?

This CB plan was effective 1/1/2004 so the 3-year cliff vesting requirement must be effective for plan years commencing 1/1/2008 and forward. Does this apply to only accruals from 1/1/2008 going forward? And the accrued benefit through 12/31/2007 remains on the old schedule? For example, an employee is hired 1/1/2005. The plan originally had a 6 year graded schedule. At 1/1/2009 would he be 60% vested (2005, 2006, 2007, and 2008)? Or would he be 100% vested in the entire benefit because he now has 4 years of vesting service? Or is he 60% vested in his benefit through 12/31/2008 and 0% vested for the benefit he accrued during 2008?

Does anyone know where I might find a checklist showing effective dates for changes in qualification requirements for a DC plan since 1985?

Is a church with a 403(b)(7) plan exempt from the IRS's written plan requirement?

I've been reading through several posts dealing with this subject and keep confusing myself.

I have a new ASG that popped up in 2009. A doctor (who has a safe harbor 401(k) plan where he is the sole HCE and 4 NHCEs) purchased a 20% interest in an outpatient surgery center during the year. The surgery center has a standard 401(k) plan with 20 NHCEs and no HCEs. They do not match, but make discretionary profit-sharing contributions of between 3% and 4% of comp. each year.

The surgery center's plan would satisfy coverage on its own automatically since it has no HCEs.

The doctor's plan, though, is only covering 4 of the 24 combined NHCEs for a 16.67% ratio.

Therefore, I would need to aggregate the plans for coverage and nondiscrimination testing, meaning my safe harbor is blown because I can't aggregate safe harbor and non-safe harbor 401(k) plans. Does this mean I need to encourage the surgery center to adopt a safe harbor 401(k) plan or simply run a combined ADP test for the two entities or have I missed something???

Thanks.

James

J&S liability is determined as of the date of withdrawal. What happens if member of controlled group liquidates and distributes assets to shareholders before plan demands payment? Is there a constructive trust imposed on liquidation proceeds?

I know that a QACA/EACA cannot be added to an exitsing 401(k) during the plan year. My question is can an "unwind" feature be added to an existing QACA/EACA during the year?

Any thoughts are greatly appreciated.

Individuals could complete an HRA in 2009 for a "rewards" (either cash or deposit to an FSA) to be paid (or deposited) in 2010. Is this still allowable under GINA? The information, which includes genetic information, was collected in 2009, it just will be paid out in 2010?

A plan that is exempt from ADP testing incorrectly issued ADP refunds for the 2007 and 2008 plan years.

They are contacting the HCE's and asking them to return the funds to the plan as after-tax monies.

One of the HCE's took a distribution and rolled his funds over.

Any idea what the plan sponsor should do in this situation? I can't imagine the refunds should come back to the plan as after tax and then distributed.

Thoughts?

I have been contacted by an advisor representing a bank that wants to offer closely held stock as an investment option in its 401(k) plan. I haven't seen this in awhile. In fact, I have only had three plans with company stock, it was publically traded, and they got it out of the plan in light of current fiduciary conditions. I have never had a plan with privately held stock. According to the advisor, the bank would like to:

· Develop plan “Policies and Procedures”

· Have plan provisions could include % limits of stock allowed per account, i.e. 10% or 20%

· Limit purchases to purchasing stock through annual deferral elections and matching contribution elections

· Establish bank’s “right of first refusal” for purchasing participants shares who are selling

· Second “right of purchase” could go to existing shareholders

· Provide liquidity for plan participants guaranteed by bank “Re-purchase liability account” established outside the plan

· Restrict rollovers to IRA’s to maintain shareholder voting control

· Find custodian who will serve as trustee/fiduciary

· Establish stock valuation procedures

The assets in the plan are currently about $3,000,000 and daily valued.

1) Generally, does this make sense in todays fiduciary environment?

2) Do any of the bank's goals present fiduciary issues?

3) Would the bank be required to have a fidelity bond equal to the value of the bank stock assets or have an audit (there are under 100 participants).

4) As an investment option in a 401(k) plan, must the stock be registered?

5) Am I missing anything?

6) Any suggestions on resources for me to research this futher?

Thanks.

From a summary prepared by American Benefits Council

http://www.americanbenefitscouncil.org/doc...mmary101509.pdf

The final regulations provide some additional transition relief which could affect funding for the 2008 plan year (for example, contributions made for the 2008 plan year can be taken into account at full value without a present value discount, provided they were made by the deadline for contributions (September 15 for calendar year plans).

Do you think it's a typo and should read "contributions made for the 2007 plan year"?

Two revised notices have been released. How aer folks going to handle which notice should be sent out? Are they going to send both. REview on an individual basis? Combine for their own notice? Just wondering...