2 separate plans of a Controlled Group - Plan A (I am TPA): Only union employees excluded and the 401(k) portion has immediate eligibility. Plan B (another TPA): Excludes Japanese employees on temporary assignment at Plan B's Company, and has a 3 month wait for 401(k) eligibility.

For the coverage and ADP/ACP testing, I have used the lowest service requirement. However, can I include the Japanese employees that have met eligibility (immediate) in my ADP/ACP tests? Plan A does not exclude Japanese employees from Plan A.

Are there any cites to either a yes or no answer?

If a plan was subject to Title IV will it always be subject to Title IV even if it happens to meet one of the exceptions in Section 4021 in later years? For example, what if the number of active participants in a plan maintained by a professional service employer falls below 25?

A plan that excludes employees who customarily work less than 20 hours per week but contains language which states if hours exceed 1000 in any computation period the employee is eligible follows the participation rules under 410(a).

However, what happens if the plan has dual eligibility (immediate for deferrals and 1000 hours for employer contributions). When an employee is hired it is estimated (based on the job title) that they would work greater than 20 hours per week and are allowed to start deferrals. In the first employment computation period they actually work less than 1000 hours and continue to work less than 1000 hours in each subsequent plan year.

After the first 12 month employment computation period, when it was discovered they never worked 1000 hours, were you suppose to stop the deferrals and consider them excludable or since they were allowed into the plan do you continue to allow deferrals.

Any thoughts would be appreciated.

Employer wants to enhance benefits to long-service participants.

They provide (a) 3% safe harbor contribution.

(b) 4% discretionary contribution and

© wants to provide an additional 1% of comp each year once the employee has reached 20 years of service.

Testing part © is the issue. Should (b) and © be tested together or is disaggregation permitted here? Does it matter?

Does this reporting only apply to large plans? That is, a certain size or asset value or amount of underfunding?

I know it references AFTAP under 80%.

Thanks.

The Form 990 includes a section where Officers, Directors, Trustees, Key EEs and HCEs need to be listed disclosing compensation amounts. One of the items includes "The annual increase in actuarial value of a qualified defined benefit plan, whether or not funded or vested". Has anyone seen this and does anyone know what actually needs to be reported?? Thanks.

An owner of a company has two common law employees. Neither employee met the 21 & 1 requirement to enter the plan on 1/1/08.

The wife was hired 1/1/08.

Can the DB plan include the wife for 2008 and exclude the employees? That is, liberal entry for wife, but still exclude employees due to the statutory requirement.

Thanks.

A plan sponsor is looking for ways to cut costs. they currently maintain a calendar year pension plan. Active participants receive an allocation as long as they are employed on the last day of the plan year regardless of the number of hours of service. Terminated participants get an allocation if they work over 500 hours.

My question is could the pension plan be restated and avoid required funding for the current plan year which started January 1?

I have a QDRO that is almost approved for a 403(b) Plan. The 402(f) rules indicate that the PAYOR has to send a 402(f) notice (rollover notice) of tax consquences of a distribution . Does this notcie have to go to an alternate payee 30 days before distribution?

Any cites would be appreciated.

thanks

Could a plan document require that a claim for benefits (after exhaustion of remedies) be filed in state court rather than federal court?

I've been reading about a letter sent from the DOL's Boston office to a pension plan on July 1, 2008, directing the plan to independently value their alternative investments. Does anyone here know if/where I might be able to get a copy of the letter?

Some argue ethics are ethics; others, that ethics are a function of how much money is involved and what's at stake.

The struggling not-for-profit IHELPU has a frozen DB plan covering 200 participants where the FT=$4 million and assets = $7 million. IHELPU engages you to conduct a plan spinoff/termination study so they can recapture the $3 million and stay afloat. You've been the actuary for the IHELPU pension plan for years and they've always paid you out of the pension trust, except the cost of FASB. You tell them in writing up front that the study will cost 35K and that further this is an expense that should be borne by IHELPU and not the pension trust. You complete the study and send IHELPU an invoice which states on it that this is not an expense that should be borne by the pension trust. You promply receive a check and low and behold it is drawn on the pension trust. You call the executive director and he says if you want to get paid, cash the check. You remind him of the agreement and caveat regarding the legal issues and he cries that IHELPU's cash flow is in the toilet.

You know that it could be two years or so before IHELPU enjoys the asset reversion if their Board even decides to proceed with the spinoff/termination. Just to compound the situation, your office rent is coming due and owing to this lovely economy, your accounts receivable are coming in slow. Times are tough and you've been pushing your credit limit. You also know that if you go above the ED's head to the Board that that will be the end of you (you can't even get to the Board without the ED's involvement).

Any comments other than I need more to do so I don't have time conjure up situations like this?

I have a DB Plan which currently states that Surviving Spouse gets QPSA on the first day of the month following death of Participant. The actuaries hate this and want the payment to begin "upon application" by the Surviving Spouse. Is there anything that would NOT allow me to amend the plan to allow for the payment to begin upon application (date of Surviving Spouse's choice) as long as I limit it as follows:

- must be allowed to commence no later than month in which participant would have attained earliest retirement age (1.401(a)-20 Q&A 22(a).

- must begin no later than the later of 12/31 of the year following P's death or 12/31 of year in which P would have been 70 1/2.

Any insight would be appreciated.

Thanks

Different ARRA question: "qualified beneficiary" is defined pursuant to federal COBRA law. "COBRA continuation coverage", however, includes federal _and_ similar state law.

In NH, civil union partners are eligible for state continuation coverage, but obviously not under federal COBRA (as a "spouse").

It looks, then, like an employer subject to the state-level law has to follow ARRA but a civil union partner (or same-sex spouse in some other states) of an employee of that employer cannot benefit from the subsidy (and that employer needs to be careful about filing for the reimbursement of the subsidy). Is that how others read the law? That is inconsistent to me, but I think that is where the wording leads us.

I'm 62, have been retired since May 2006 retired, am living with wife and two kids on my pension and occasional freelance work, total income was way below the low-side threshold for Roth contributions. In March of 2008, I made a 2007 Regular-IRA contribution and a 2008 Roth contribution. Since I didn't hold a full-time job, though, was I even eligible for the Roth contribution? For Tax Year 2009, if I don't have any income other than my pension or if freelance income is less than the $6000 max Roth contribution, am I eligible for making any Roth contribution?

Two more questions, please:

1) As part of my 2007 tax declaration I forgot to file the Form 8606 for non-deductible IRAs. Am I right to think that since ALL my Regular- and Roth-IRA contributions have ALWAYS been NON-deductible, the oversight doesn't really have tax consequences, so that I can just file an updated Form 8606 with my upcoming 2008 tax declaration to record the 2007 Regular-IRA contribution and, on a separate Form 8606, show my 2008 Roth-IRA contribution??

2) I was SO depressed last year about my stupid investing, I never even THOUGHT about paying to convert my Regular IRA into a Roth. Now, the nearly-all-eggs-in-one stock I have in my Regular IRA seems to be headed out of deep red into green after all, so now I'm kicking myself for failure-to-convert stupidity! My income hasn't changed and won't, so can I convert NOW, even though it'll cost more because the stock has gone up???

Thank you very much in advance for helping me out!

Heres the scenario.

Employee has 401K plan with Company A. Employee leaves company A to go to work for Company B. He leaves his 401K plan with Company A. Ultimately Company A aquires Company B and so Employee is back in service at Company A. He now has a 401K plan with Company B that will remain separate. The payroll systems of Companys A and B are still separate. Is Company A obligated to allow Employee to take a plan loan from the 401K plan he has with Company A pursuant to DOL language that loans must be "available to all such participants and beneficiiaries on a reasonably equivalent basis". I know the DOL has said that loans can be limited to parties in interest making it so that companies do not have to make loans to former employees. By being back in service wouldn't he be a party in interest again?

Thoughts?

I have a question for anyone who might be able to help. 2 people divorce. Court orders percent of PP to ex-wife. Her and attorney sends in DRO and the PA declines it and gives them X amount of months to re-submit. Ex and her attorney do nothing. Ex goes and files for bankruptcy 1 year later

(after divorce) and does not file exemption on her portion of pension?

12 years later, ex is back in court and wants the state judge to amend or modified DRO.... How would that work out? Can she still do that? What about not claiming exemption on bankruptcy? Would this fall under Anti-alienation provision in the fact that :

ERISA states this:

One of the very few exceptions to ERISA's Anti-alienation format was provided by congress in the 1984 amendments to ERISA known as the retirement equity act, and codified as 29 U.S.C 1056 (d)(3)(A). This exception established Qualified Domestic Relations Orders, called QDRO's.

The section distinguishes between NON-Qualified Domestic Orders WHICH ARE NOT EXEMPT from anti-alienation under ERISA, and Qualified Domestic relations orders, which are exempt.

If Not What do you do with the fact that there was no QDRO... (and still isn't) Ex filed Bankruptcy without exemption of her portion of pension....and now wants a judge to reinstate a new order?

Thanks in Advance

Has anyone ever designed a plan & received a favorable determination where eligible employees are named individuals (plan passes the 70% coverage test) instead of by job classification/ pay level etc?

A very large client was recently told by ADP that ADP is not able to handle Roth 401(k) contributions. Can anyone confirm that this is true? We find it hard to believe.

Thanks.

A client is attempting to test a DC / DB plan combination for the death benefit. This is because the DB plan has life insurance and defines the death benefit as PVAB plus face amount minus cash value (the HCEs are in this plan with a smattering of NHCEs necessary to pass coverage). The death benefit in the DC plan is obviously the account balance.

A couple of questions have arisen:

1 When testing a benefit, right and feature - does the plan have to pass the 70% test or a 100% test when comparing the NHCEs to the HCEs?

I believe the answer is 70% when looking at the 'availability' of a benefit on a current basis. However, I read about 'effective' availability which might be an issue

2 Is it a simple comparison of what is available now OR must it be like the most valuable testing and compare the death benefit at all ages and take the most valuable??

I could not help the client as I have never tested a BRF.

Any help that can be provided is greatly appreciated!!