Can anyone help me understand this?

I have a DB plan that terminated and paid all participants out on 5/16/2008. We promptly filed the 2008 Form 5500 for the final filing. Basically it was a 2007 form with the 2007 crossed off everywhere and 2008 replacing it. We had done this before with no problems.

I got a letter today... 11 months later, saying they could not except the schedule B... it had to be an SB. (I am aware of the notice that went out saying they won't except SB. Does any one remember what it was called?)

My question is when did they officially release the SB? Am i suppose to use the PVABs as the funding targets? anyone else dealt with this?

Andrew

Does a discretionary amendment made pursuant to the HEART Act have to be adopted by the end of the plan year the amendment is effective or can the plan be amended in 2010 and the discretionary amendment relate back to a prior plan year?

We have a client that filed their corporate tax return for 2008 in late January, 2009. When the valuation and Form 5500 were delivered to them today, they informed our office that they have not funded their 2008 SHNE contribution yet. I know that they have until the filing deadline date to fund, but since we are already past 3/15/09, what are the ramifications for not funding by then? I'm reading up on 404(a)(6), but thought I would pick some brains here before I spend hours reseaching. The client wants an answer today, of course! Thanks for any guidance on this. It's never come up before in 20+ years of admin work.

I'm sure you have all seen this but for those who have not, it is the most inspiring thing I have heard in a long time.

A perfect example of don't judge a book by its cover.

Cynics beware.

Susan Boyle

Is it required that catch-up contributions be matched in a safe harbor 401k plan?

Thanks

An employee terminates employment with a balance in their Health FSA. They are offered COBRA for the Health FSA.

At the same time, they are hired by another employer, and become eligible for their FSA plan. Can they still continue COBRA through the former employer, and at the same time be covered under the new employer's FSA plan?

Thanks.

I generally try to encourage clients to use NRAs at age 62 or later (safe-harbor), but for the occassional client that insists on using a lower NRA (usually to help increase the tax deduction where high-3 comp avg. is less than 415 dollar limit) is there any good statistical info that is either free or via a modest subscription service that provides some industry norms for retirement ages (any DOL workforce surveys or anything like that). Of course the small family businesss that breeds purebred dogs might have a hard time finding good statistics, but for common occupations there must be some data free or at a reasonable price. Any ideas ? thanks.

There appear to be two different effective interest rates on the Schedule SB: at Line 5 and at Line 11b.

In a small plan, a $25,000 contribution for 2008 was paid on 2/13/2009.

For the 1/1/2009 valuation, to determine BOY assets, I believe that I should use the 2008 Line 5 effective rate to discount that contribution to the valuation date.

The Line 11b effective rate, that will appear on the 2009 Schedule SB is -18.41%.

Am I correct that the Line 11b effective rate is only used to calculate the 1/1/2009 prefunding balance?

Thanks!

Anyone know of regulations that would limit the amount of contributions to a company non-qualified deferred comp plan if their DB plan's AFTAP is between 60-80%?

Plan's very large, national investment service provider for 401(k) participant-directed plan refuses to make RMDs, even after being told it is a 401(a) plan qualification issue; the TPA and legal counsel have been unsuccesful in convincing them this is required. They will not distribute without a written participant election for distribution on file. TPA or Trustee instructions to distribute they will not accept. Anyone else run into this kind of situation or have a solution (other than participant-by-participant EPCRS corrections)?

Yes, we are still doing end of the year valuations for all of our plans under 100...

I have several questions:

Am I correct in the following assumptions?

1) All plans regardless of size are required to have quarterly contributions for the plan year following a plan year with a shortfall.

2) For an end of the year plan with prior year shortfall, even though, the 2008 required contribution has not been calculated until after 12/31/2008, contributions were still needed to be made on 4/15/2008, 7/15/2008, 10/15/2008 and 1/15/2008. These missed payments are then penaltized.

follow up questions.

1) Do pbgc covered plans have to notify the pbgc of missed quarterlies with form 10?

2) Is the 5% penalty applied the same way as for beginning of the year plans?

Thank you,

Andrew

How are people doing them? Manually? How long are they taking? Relus' isn't ready nor are they committing to when they will be. We're proceeding manually at this point. Slooowly.

DBPP. Participant turns age 70.5 on 9/1/09. If he elects to defer RMD start date until 4/1/10, is the RMD for 2010 12 times the monthly accrued benfit (2010) plus 3 times the monthly benefit for 2009 (10/1/09-12/31/09)

Thanks!

One of our client's has a PS plan and a DB plan. My firm does not administer the DB plan.

The PS plan is a discretionary New Comparability plan with the employees divided into 4 groups based on job function.

The two plans are aggregated for coverage. The DB actuary completed the general nondiscrimination testing. He did the testing assuming a 7% nonelective contribution to the NHCEs plus an additional amount for just two individuals, which he stated had to be given in order for the general test to pass.

These two individuals are not in a group by themselves for the profit sharing. The PS plan document says that the profit sharing contribution will be divided equally by compensation within each group in the plan document. So by completing the PS allocation as requested by the actuary, we will violate the PS plan document.

My question is whether or not we can do an 11(g) amendment when there are other ways to resolve the failed general test without doing a retroactive amendment (i.e. raise everyone in that group to the higher percentage)?

11(g) provides an option to retroactively amend a plan to correct a nondiscrimination failure. But can you consider the nondiscrimination test to be failing in a discretionary PS plan before you have exhausted all of the options?

Thank you,

Laura

Does eliminating the employer's ability to terminate a 457 plan automatically mean that there is not longer a "substantial risk of forfeiture" and all benefits will be taxed presently?

The employer is a non profit organization. The employee is terminating employment and the severance agreement provides for monthly payments during her lifetime pursuant to a 457 plan. The employee wants the plan and the severance agreement to provide that the employer cannot terminate the plan without the prior written consent of the employee. Does this eliminate the "substantial risk of forfeiture"?

I appreciate any thoughts on this, thanks.

I've been discussing this with a colleague, and it appears to us that the SAR requirement has not been repealed for ALL traditional DB plans, but only those subject to PBGC.

This led me on a merry romp. I note in passing that such luminaries as Sal Tripodi and Janice Wegesin flatly state that SAR's are no longer required for DB plans. When I view the statutory language of PPA, and the Conference Committee reports, I can see how one might arrive at this conclusion, as there are headings that state that the Summary Annual Report doesn't apply. However, I don't think these can be read in a vacuum. I think the repeal of the SAR requirement does, in fact, apply only to those plans covered by the PBGC. Before agreeing or disagreeing with this, it is probably worthwhile to actually read PPA 503 and the Committee Reports, as well as as WRERA 105. Otherwise, it's hard to get the full flavor of this. But for what appears to be the plain, updated statutory language:

The new ERISA 104(b)(3) as amended, provides for SAR's on plans "...(other than an administrator of a defined benefit plan to which the requirements of section 101(f) applies)..."

And lo and behold, 101(f) applies to defined benefit plans to which title IV applies, which is a PBGC covered plan. So the ERISA 104(b)(3) default to provide an SAR appears to have an exception only for those plans to which 101(f) applies.

I'll be the first to admit I may have missed something crucial here, which is why I'd greatly appreciate opinions on this swill.

Thoughts?

Is it just a coincidence that if you combine 'The IRS' you get 'theirs'?

I need to file 5500EZ for 2006 and 2007. I filed the form before that. I read other posts about filing late, and I understand that statement of reasonable cause should be attached. What is a good reasonable cause?

Also, does anyone know a good accountant/CPA in Silicon Valley with experience in this area.

I have an overfunded, collectively-bargained DB Plan that the employer wants to get rid of...in favor of a 401(k) Profit-Sharing Plan.

I am wondering if anyone can share a really creative idea for how to terminate/convert/merge this Plan out of existence. Unfortunately, I am not familiar with collectively-bargained plans and there is approximately $20,000,000 in overfunding (can you believe it in this economy?!?!?!), so I really don't want to mess this up and have excise tax imposed on that large of a sum.

My gut reaction is to terminate and have the vested assets rolled into a new 401(k) Profit-Sharing Plan (to the extent the Participants choose that), and to have a successor Cash Balance Pension Plan put in place until the overfunded assets are "burned" into new accrued benefits.

I am curious though, if a conversion/merger is possible. I know the employer would rather have admin costs for only one plan (and a 401(k) PS Plan would obviously be cheaper). I keep coming back to Treas. Reg. 1.414(l)-(1)(l), but have seen a lot of discouragement from experts here.

I guess my questions are:

1. Any ideas about the above?

2. Any issues that need to be taken into considerations with a collectively-bargained plan?