I've been using this site for over 10 years in my various positions and love the level of expertise so this is my first stop. I am in a new position at a large company (3,000+ ees). The day I accepted the position, the 401(k) recordkeeper "fired" us so my first assignment is an RFP. We have a safe harbor 401(k) with a leveraged ESOP match so that might limit us, but we are considering removing that feature to retain the right recordkeeper. We have a Roth feature as well. Three loan limit. Nothing out of the ordinary for a large plan.

Anyway, let me get to the point. We are a "big fish" and we need comprehensive services that allow company stock, collective trusts, actively managed funds, and target date funds. No brokerage. I am sending the RFP to the "big fish bowls" - Fidelity, Citistreet, Principal, etc. But I wanted to ask if anyone has a favorable (or unfavorable) opinion or experience with providers. We are under the gun to get this in place by mid-February. I know, it seems impossible, but with benefit plans, we all know nothing is impossible, right?

If I did not provide enough info, please post and I'll fill in the blanks.

ANY HELP at all is greatly appreciated! Thank you!

We used to run our DB plans using the individual aggregate method and 30-year treasury rates. Now we have to switch to unit credit and the [blended] segment rates. These changes take what was a fairly predictable, level annual funding requirement and create potential annual funding increases. And, as I understand it (new to this), the funding cushion amount also may be used to decrease future funding requirements. Basically, is this correct?

Would anyone have a spreadsheet using unit credit method that could take a participant(s) age, compensation, segment rates and project out the potential annual increases in the funding requirements (perhaps more data would be needed to do this)? Would it be possible to also include in this spreadsheet the projected effect use of a funding cushion would have on future funding requirements?

Any assistance with this is appreciated!

Plan has been in existence for years. We are missing some very old, but very important employee data (date of hire, compensation, etc....) for a handful of employees. Any suggestions on how to deal with this? Employer clearly misplaced the information, but should we request that the employees somehow prove they were employed and what compensation they earned during those years before we give them credit under the Plan?

I have read from several sources that if a non-profit org makes employer contributions into a 403-b they would have to an ERISA plan, rather than non-ERISA.

However, my question is whether a 501c-3 church can make employer contributions to only selected employees, in the

403-b plan, and still be non-ERISA, rather than needing to be ERISA controlled?

Any IRC or DOL ruling would be appreciated, as well. Thank you

Ted in PA

In the range 0-999,999,999 [one billion numbers], how many times does the number 8 appear? Count each occurrence. For example, the number 8,088 counts as 3 rather than 1.

This was inspired by a recent Car-Talk puzzler. "Click and Clack" can explain everything other than why my car radio is always tuned to a hip-hop station after it is returned by the parking lot attendant.

I'm still relatively new to COBRA. I have an employee who already missed 1/2 month of insurance deduction in October and come to find out that he is off on medical LOA. He won't be back until mid November but only as a part-time employee where he is not eligible for insurance.

1. Do I send him a COBRA letter based on his LOA date or when he becomes PT when he comes back?

2. This company normally keeps people who are gone for FMLA on the normal insurance and hope they come back and play catch up on their portion of the insurance. Is this the correct way of doing this or do you send people to COBRA for LOA too since they are not contributing anything while they ar gone. Is LOA considered a qualifying event?

Thanks for answering my questions.

Does anyone see a problem with a nonqualified plan subject to 409A providing that if the participant's account balance is less than some fixed amount (say, $25,000) at the distribution date, then it's a lump sum, but if it's at or above that amount, it will be paid in accordance with the participant's (timely made) form and timing election, such as a 10 year installment payment? [This is not intended to fit within the discretionary de minimis rule.]

When does the effective date for TRA '86 fall? Also, can someone provide an official source for this, perhaps a chart

When does the required effective date for retirement plans for TRA '86 fall? Can someone please provide an official source for this, with perhaps a chart describing when which provisions of TRA '86 have their own respective required effective date.

Also, can someone articulate the distinction between an effective date and an execution date?

For retirement plans, what serves as the required effective date for UCA and OBRA?

When do the UCA and OBRA required effective dates fall?

401(a)(31), 401(a)(9) effective dates for a retirement plan questions; absolute or first day of the first plan year following the effective dates given?

Anyone answering, if not inconvenient, please provide an official source.

For 401(a)(31) and 401(a)(9), do the effective dates apply asbolutely, or do they only apply to the first day of the first plan year following the effective date?

I am trying to identify a possible speaker to give a one-hour presentation to a professional group of retirement-plan professionals (attorneys, actuaries, trustees, investment advisors) in Milwaukee in early to mid-December. Topic can be retirement plan related, or could be a broader topic, i.e. something of interest to professionals, the workplace, etc. Any recommendations welcome (please e-mail kelly.kuglitsch 'at' dbr.com). Thank you!

I am trying to identify a possible speaker to give a one-hour presentation to a professional group of retirement-plan professionals (attorneys, actuaries, trustees, investment advisors) in Milwaukee in early to mid-December. Topic can be retirement plan related, or could be a broader topic, i.e. something of interest to professionals, the workplace, etc. Any recommendations welcome (please e-mail kelly.kuglitsch 'at' dbr.com). Thank you!

401(k) Plan sponsor switches recordkeepers early in 2008. Old recordkeeper supplied prototype as part of service, new recordkeeper does not. Old recordkeeper was also TPA (bundled arrangement).

Plan sponsor engages new independent TPA (new recordkeeper only "keeps the records" doesn't ADP test, offer prototype etc) who will assist with ADP testing etc and also fills out prototype based on plan sponsor's desired provisions (basically mapped from prototype of terminated recordkeeper).

How much gap is permitted from the time the assets move from the terminated recordkeeper (assume that recordkeeper states as most do that prototype can no longer be used once assets are no longer w/ said recordkeeper) until the adoption of the restated prototype? If done w/in the same plan year is this okay?

Thanks for any help.

Company A sponsors a plan, #002. Company B now takes over the employees of company A, and assumes the assets and liabilities of the Company A plan as the new plan sponsor. Company B has never sponsored a qualified plan.

Does the 3 digit plan # remain #002, or does it change to 001 as they are a new sponsor?

I lean toward 001, as this is the first plan ever being formally sponsored by Company B, but some folks think it should still be 002.

Opinions?

Only plan participant is the owner. The only employee will become eligible on 1/1/2009. Eligibility is 2 years based on hire and anniversary of hire, nearest anniversary of plan.

Owner wishes to do a hard freeze - no benefits will accrue and no new participants.

401(a)(26) says if only 2 employees, both must participate (benefit) under the plan.

Can this plan be frozen?

In preparation for making a deductible limit calculation after PPA a couple of aspects are unclear and are as follows:

1. Plans with less than 500 participants are deemed "not at-risk". Can we still apply the at-rsik assumptions to the computation of the FT and TNC, including the loading factor, under 404? I would presume yes.

2. When computing the cushion amount for a plan that is covered by the PBGC, can increases that are expected to occur under 415(b) be taken into account? What about 401(a)(17)?

3. Are amounts calculated above allowed to be brought to the end of the plan year? For example if the amounts are 100k at BOY and 106k at end of year, can 106k be contributed and deducted if it is made any time during the plan year and up to the due date of tax return? So for a 2008 calendar plan/fiscal year that would mean 106k could be made anytime from 1/1/08 through 9/15/08 (assuming tax return extended to this date). I'm thinking the adjustment to the contributions using the effective interest rate applies to the minimum required contribution and not to the maximum deductible contribution.

Thank you.

Employer and union considering moving from single employer DB plan to contributions to multi-employer DB plan. Existing plan assets would be transferred to the multi-employer plan. All benefits (existing and future accruals) would be delivered under the multi-employer plan.

Any references to resources to review pros and cons of proposal? Thanks.

We've just starting running 2008 projections on our clients (almost all are EOY vals).

Our software system uses the following approach (assume 2008 is the 2nd year of plan; 1 life client at 415 limit both years 2007-2008).

1. Takes PV of 2/10th of 415 limit @12/31/08 (uses 415 limit assumptions @ NRA discounts on segment rate).

2. Funding Target: Takes PV of Beg-of-Yr 1/10th of 415 limit (uses plan's actuarial equivalence @ NRA which is stronger than 415, discount on segment rate).

3. Limits Target Normal Cost (1/10th of 415 limit) to Step #1 above minus Step #2.

My question is simply why would the 1/10th of 415 limit at BOY (funding target) be valued on more aggressive assumptions (actuarial equivalence of 1983 IAF,5%, J&S) than the normal cost 1/10th of 415 limit. I would have thought the funding target (1/10th of 415 limit assumptions discounted at segment rates) would have been the same as target normal cost (1/10th of 415 assumptions discounted at segment rates)

Yes, I asked the software vendor and the response was essentially "if we reduced the funding target to 1/10th of 415 limit (using 415 assumptions) we would be improperly understading the funding target and overstating AFTAP. The beginning of year PV is calculated using actuarial equivalence and then reduces for the maximum limit."

Is this what you would expect to see for a 2nd year plan funding at 415 limit (1/10th) both years ?

Public Service Announcement

A number of clients have asked what in the name of J. Fred Muggs they are going to do about the 80% threshold in 2009. This is particularly a concern to those who dumped in a considerable sum in 2008 so that their plan could continue to pay full lump sum benefits (except to the HCEs).

In 2008 it would have been a stigma, perhaps even a sign of poor asset management, to all of a sudden announce that lump sums were restricted. So, many employers ponied up. Now, bless this stinking market. Only those people who went to cash early or who are lying made money during this slump. Most (yours truly included) got decimated. The market now provides a natural and reasonable rationale for letting the chips fall where they may. While participants will not welcome with smilies the benefits restriction notice, they will understand the reasoning and may not be so apt to burn the employer in effigy.

If the market continues to decline throughout the remainder of 2008, don't be surprised if Congress comes back with some temporary 436 relief (perhaps removing for 2009 the deemed 10% reduction of the 2008 AFTAP presumption). Of course, don't be surprise if they don't.

Does anyone know if it is acceptable to use numbers rounded to the nearest thousand on the Schedule B?