Where can I find the ERISA code online? All I seem to find are bits and pieces of it. Is it all in one place anywhere?

I am having a hard time finding out whether my husband would qualify for the ARRA COBRA subsidy.

He is a member of the American Federation of Musicians (AFM). Like SAG, AFM bases its member eligibility for health benefits based on earnings from the previous year.

My husband did a small piece of discrete work (a project that was completed [nobody was fired, nobody quit, the work was just completed]) in 2007. This 2007 work qualified him for health benefits through AFM, his union, for 2008. In 2008, my husband didn't have any AFM work and thus did not qualify for health benefits for 2009. The union health plan thusly COBRAd him starting 1/1/09. He elected COBRA and has been paying his premiums.

We get in the mail a notice saying he may qualify for the ARRA subsidy. I spoke to the union plan administrator and was told he would not qualify since his employment was not terminated in the late 2008 / early 2009 window. While that is true, it struck me as strange since the plan is the union's and eligibility is determined by being earned-eligible for a past period. It would seem to me that involuntary termination from the health plan due to a failure to meet the earnings requirement and thus being COBRAd would be the critical event.

I was debating having my husband send the form in and claim that the union was his employer and that the involuntary termination from the health plan was the actionable event and thus date of importance.

I can see the union's point of view in that they didn't pay my husband's wages (they required a contribution from the 2007 employer to qualify my husband for eligibility) and thus aren't responsible to subsidize my husband's health premiums. Still, it seems strange in that nobody who is a member of this type of union (health plan eligibilty based upon previous year's earnings) would ever qualify for the ARRA subsidy.

Maybe that's how it's supposed to be. I don't know. In any event, the amount of money at stake is substantial to us so if anyone could shed some light on this, I would be grateful.

Mary

Normally a lot of plans will specify this limit (loan<50% of vested balance) in the plan document, but not this one.

Is the 50% rule a general one? If so, where can I find the official reference?

Thanks!

Per plan document, loan is considered in default at the end of calendar quarter following the calender quarter when the payment is due.

One participant failed to make any repayment from June to September (more than 3 months) and was considered as in default by the system.

However this person restarted repayments in September but by 12/31/08 his outstanding balance is still larger than the balance per amortization schedule, and the variance is lager than 3 months' of payments.

The system still has this as loan (indicated "default".) Should this loan still be reported as a loan or a deemed distribution (tax needs to be withheld)?

Any input would be appreciated - Thanks!

In a Top Heavy Cash Balance Plan, does the minimum benefit for a non-key employee have to be:

1. a contribution credit equal to the amount needed, with projection, to fund an annuity of 2% AMC at NRD, or

2. a contribution credit of 3% (or 5%) of compensation?

Here's the scenario:

Company is on a per-pay period compensation computation period; safe harbor match is funded on a per-payroll basis. Currently there is no true-up provision.

One partner decided to defer 100% of the first few paychecks to max out 2009 contributions early, so their match calculation was for the respective payrolls.

Example:

1/15 payroll - Comp: $11,000; deferral amount: $11,000; Safe harbor match: $440

1/30 payroll - Comp: $11,000; deferral amount: $11,000; Safe harbor match: $440

So as of 1/30, the participant has maxed-out ($22,000) and received a total match of $880. Because their is no true-up, this person is not entitled to any additional match.

So, if we amend the plan mid-year to allow a true-up, can we look at the annual numbers, or are we stuck looking at in on the micro-level of truing up each pay period?

In short, would the plan run into any issues getting this partner the full $9800 match (4% * 245,000) or is he stuck with the $880 (assuming we amend to allow annual true-ups)?

Is anyone aware of a place I can find a good timeline for an old-fashioned spin-off termination?

let’s say an employer lends money to employees so that they can pay moving expenses. When they work with the employer for a certain amount of time the forgive the loan. The employer reflects the cancellation of indebtedness on the employee’s w-2. the plan excludes fringe/moving expenses from compensation. Do you think the cancellation of indebtedness is a fringe benefit? In my view it is not reimbursement of a moving expense because of the fact that it was a loan originally.

Participant directs that deferrals be used to purchase Fund A. In error, the deferrals are used to purchase Fund B. When the error is discovered, it is corrected.

If the error results in a loss to the participant, the partipant is made whole. So far, so good. But, if the error results in a gain, the gain is taken from the plan and used to offset the amounts that have been used to make other participants whole in prior error situations.

If the gain is not directed from the plan to a fiduciary, I guess there's not a problem--although it just doesn't seem right to me. I think the $$ should stay in the plan and be allocated to participants on some kind of proportional basis.

Is the procedure described (gains taken from the plan) appropriate? Would it make a difference if the funds were directed to a plan fiduciary?

A newly hired employee would like to opt out of the ER's 403(b) plan. Not only does he choose not to defer, but he'd rather receive more compensation than an ER contribution to the plan. I know that under a regular DC plan, the ER would have to adopt a volume submitter or individually designed plan to allow this, but 403(b)s aren't available as prototypes and don't have the same submission process -- at least not yet. I tried the 403(b) Answer Book, but couldn't find anything.

Can a self-insured health care plan reduce the hours for elibility from 30 -24 to ensure that a reduction in work across the board for a manufactuing plant does not change the health care for the employees? I would think that as long as the underwriter is ok with it - that there would be no problems.

Also - do we have to amend the plan? If the reduction in work to 24 hours a week is only temporary (2 months) - can the 30 hour requirement still be met since it is supposed to be "normally" work 30 hours? Can this be calcuated over a year or over the quarter to see if more often than not they work 30 hours a week? And since the Plan administrator is the company - can they chose to interpret the 30 hours normally worked to be calcualted over the year?

Any help would be appreciated.

thanks

I am going to prepare a new DB plan document for a client.

My understanding is that NRA must be set at at least age 62 unless the typical retirement age in the particulat industry is justifiably less than 62.

My simple solution to use age 62 is as follows:

Set NRA to age 62 and have early retirement begin at age 55 with fully subsidized benefit. That is, accrued benefit with no reduction for early retirement.

This way the plan can use an assumed age 55 retirement while meeting the age 62 requirement for in-service distributions.

Any thoughts with this approach?

Thanks

I have a cash balance plan with 4 HCEs and 10 NHCEs.

2 HCEs want to leave the company and start their own company.

The plan has a shortfall.

Can the 2 hces that are leaving waive part of their benefits so that the other 2 hces aren't on the hook for it?

Client deferred more money than employee requested. When returning excess money should earnings be given?

Doesn't seem to be addressed in Rev. Proc. 2008-50.

My thoughts:

EPCRS attempts to make employee whole, as if error had never occurred. If earnings loss then return principal amount. If earnings gain, then include earnings.

Please provide citations.

Note: this is not a 402(g) or 415 issue. Company just didn't follow admin procedures.

Worker dies in late February. His name beneficiary, who is also his sole living relative, is a daughter. She then dies in early March. Her remaining relatives are two minor children (grandchildren of worker), who she defined as her beneficiaries in a will (not related to Plan). A court order has been issued that says pay to either (???) the estate or the minor children. If the latter, monies are to be sent to a "trust account" for the 2 children.

My thoughts are that the payment should be to the estate as the grandchildren were never named as beneficiary of the worker. Comments?

It seems as though companies not required to capitalize costs under IRC Section 263A can deduct IBNR as long as they accrue it without having to fund same. Service companies such as accounting and consulting firms come to mind.

What other firms can take advantage of this departure from the 1972 U.S. Supreme Court decision involving General Dynamics?

Jack, a 5% owner, was born 2/15/1939 so Jack turns 70 1/2 on 8/15/2009. His RBD is 4/1/2010. The defined benefit Plan covering Jack allows for inservice distribution after age 70. Jack elects to take a lump sum distribution in July 2009.

Q1: Is part of the lump sum considered to be a minimum required distribution and therefore not eligible for IRA rollover? In short, does taking a lump sum distribution nullify the ability to defer the minimum until the next April 1?

Q2: If the answer to Q1 is "yes," is it valid to determine the minimum distribution as his lump sum divided by the joint life multiple for Jack and his wife (Jill)?

If we elect to use the yield curve for a November 1, 2008 valuation (using the valuation month), are the rates 7.11%, 8.23% and 7.42%? These rates would definitely lower the Funding Target.

Are these rates used for all purposes of the valuation calculations (i.e. AFTAP, benefit restrictions under Section 436, PBGC). How long are we stuck with using the yield curve (versus the segment rates)?

When does the plan sponsor have to make this election to use the yield curve.

Any other comments?

I need some clarification regarding conversion of my traditional/ roll over IRA to Roth IRA and Required Minimum Distribution(RMD) from IRA and annuity with the following facts.

My date of birth is July 16th. 1939.

I file Income tax as married file jointly and my AGI is less than $100,000.

I will be 70-1/2 on January 16th. 2010.

What will be my required beginning date to receive distributions from my IRA. April, 1st. 2010 or 2011?

What is the maximum amount I can convert traditional Ira to Roth IRA?

What is the end date after which I can not convert my traditional IRA to Roth IRA?

What is the RMD for my Annuity?

How can I tell if a given EB plan is an H&W plan or fringe benefit plan?