Have an employee with voluntary after tax balance who has terminated employment and wants rollover. New brokerage account does not want after tax contributions.

If all but after-tax is rolled over, is the after tax still considered tax fee in year of distribution, since its a complete distribution?

Employee is only 52 if that has a bearing...

Thanks

We have a separate plan for our active employees and retirees. If we terminate coverage for certain groups under the retiree plan, would we be required to offer COBRA for those recent retirees (e.g. those who became retirees less than 18 months ago)? I realize the retiree plan ceasing to provide coverage is not a qualifying event, but am a little concerned whether the failure to return the COBRA election forms is an effective waiver? The COBRA election forms do state that if you fail to return the form, you lose your right to elect COBRA. Any thoughts?

With 4 companies listed under a 401(k) MEP doc, if the sponsoring company (company A) wants to terminate the plan and the 3 other participating companies (companies BCD) want to install new 401(k)s to continue benefit,

1) What is the proper procedure for terminating from the MEP so that BCD can adopt a new plan? Remove by resolution/amendment from the MEP first, then adopt new plan? Or can the sponsor (A) terminate the MEP which defaults to BCD's removal from MEP and they start their own respective plans with no wait period?

2) If it is necessary to remove BCD from MEP first prior to MEP termination as the best course of action, is it necessary to restate the MEP at this time to adopt new language for BCD removal?

3) Similarly, when terminating the MEP, is it necessary to restate the MEP at this time to adopt new language?

Does anyone have a client that intends on implementing this provision for health fsas under the HEART Act?

If yes, how does the money get distributed from the plan? Also, an employee that is called to active duty is entitled to all or a portion of the balance in the employee's account - does this mean the amount contributed to date, minus any reimbursements, or the entire amount elected for the year?

Any thoughts/guidance is appreciated - thanks.

We have a situation where we have a QDRO, the alternate payee has died and did not name a beneficiary. In paying the benefits due the AP, do we just pay to the AP's estate (which is what we do if a participant does not name a beneficiary and has no spouse, etc.)?

Let's stick to a calendar year plan with January 1 valuation date for discussion.

It is clear that 2007 contributions made in 2008 are included in plan assets for determining the UVB. It is also clear that after 2008, prior year accrued contributions must be discounted to January 1. What is unclear (as my evidence will show) is whether or not 2007 contributions made in 2008 are discounted back to January 1, 2008.

ASPPA (No. 8-10) says "no." More important, instructions for completing the PBGC forms explicitly say "No" ("For Premium Payment years beginning in 2008, such prior year contribution are included without discounting"). Now, technical releases from both Deloitte and JP Morgan say "Yes." More important, I do not see in PBGC regs. that there is a discount exclusion for 2008.

Frankly, an exclusion for 2008 seems totally inconsistent with how the PBGC has historically treated accrued contributions for premium calculation purposes. On the other hand, the PBGC may be serving grace to those end-of-year valuations.

Will someone with fresh batteries in his flashlight please shed some light on this dilemma?

401(k) plan has a match formula of 100% of salary deferral up to 2% of compensation; however, only those who defer at least 4% of compensation are eligible for the match.

There is a potenital BRF issue, but I'm not sure how to test for current availability.

Two possibilities come to mind:

1) Test based on the fact that everyone had the ability to defer at least 4% of their compensation. Therefore, the matching formula was available to everyone, even if they did not defer at least 4%.

2)Test based on the deferral percentages for each participant. Only those who deferred at least 4% were eligible for the match, so they are the only ones benefiting for the availability test.

Any thoughts or other ideas?

Thanks!

Does anyone know of a third party we could outsource this to? We are looking at this type of plan as alternative to severance plan.

We are looking for new defined contribution health plan software (including HSAs, HRAs, and even FSAs). Does anyone have any thoughts/experiences/recommendations they are willing share?

Can someone on disability withdraw from their 401(k)?

Did anyone watch the ALI-ABA seminar Monday (8/25) discussing the new EPCRS? If so, what surprises did you take away aside from these:

• Joyce Kahn (Manager of the EPCRS Program) said that she has only come across one egregious failure for which the IRS did not approve correction. That means either that there are not any really bad acts out there, or that the really bad actors don't come in under EPCRS, or that the EPCRS staff is pretty lenient. The surprise, to me, was that Joyce said it.
  
• Joyce took the position that if a safe harbor plan fails (for example, if the safe harbor contribution is not made within 12 months after the end of the plan year), then the natural consequence contained in the regs--i.e., that the plan no longer is a safe harbor and must pass ADP--does not apply, and to correct you must make the late SH contribution (with interest). I think what she meant is that you can't rely on passing ADP if you fail to make the safe harbor contribution timely, because you would simply get out from under the SH contribution obligation without following proper procedures (such as in the "maybe"--supplemental notice--non-elective SH contribution situation). I would suspect, however, that if failure to timely make the SH contribution resulted in failure of the ADP, and correction of that ADP failure under VCP would give the NHCEs more than making the SH contribution would give them, then she would require that the failed ADP test be corrected rather than that the SH contribution be made.
  

Anyone else have any comments, surprises, insights from watching the seminar--either about the seminar itself or about the new EPCRS--that they want to share? (I haven't gone through all of the new EPCRS yet, but it apparently is much more friendly and has relaxed some requirements and added some new corrections.)

IDP DBPP cycle E, received a letter in 2003, but it did not cover EGTRRA. Do I have until 2010 or did I miss a submission deadline already?

We have a 401(k) Plan that consists of Pre-Tax deferrals, Roth deferrals, Wage Rate contributions, and a 4% Match (note: the match is only allocated to non-prevailing wage participants). The plan document states that "all matching contributions are QMAC's".

It is my understanding that we can include up to 10% of each participant's Wage Rate contributions in the ADP test pursuant to 1.401(k)-2(6)(iv)(D); however, in addition to this, are we permitted to include the 4% match / QMAC in the ADP test?

Any input on this would be greatly appreciated!

Thanks.

My outsourcing vendor has gone pretty far into a selection process and identified this company as the preferred vendor. Problem is we've never heard of them before and have conducted a few COBRA RFPs in the past 15 years.

Has anyone heard of this COBRA vendor? If so, can you please provide some high-level information on them -- the good, the bad and the ugly would be helpful.

Thank you.

You can rollover an contributory IRA to a 401(k) Plan - but can you rollover a rollover IRA from a qualified plan to another qualified plan?

Thanks

Is the due date of wage rate contributions to a Prevailing Wage Plan on or before the extended due date of the company's tax return (e.g., September 15th for a calendar year corp) or is there a rule that says the deposits must be made on an ongoing basis within a few days of each payroll (like with 401(k) deferrals)?

Thanks!

One doctor has a corp and a 5 year old 401(k) Plan with the usual 21 and 1 year and dual entry dates.

New doctor will start a corp and the 2 corps will form a partnership. They would like the new EGTRRA document to waive eligibility requirements for the doctor and his wife by waiving requirements for anyone employed on or before October 1, 2008.

How exactly would this work? What would we do with the nurse hired 2-01-08. Would we just let her in on October 1st or is there something else we would have to do for her? How about the receptionist hired November of 2007?

I have read that this is a Benefit, right or feature that must be tested for coverage.

On 12-31-08 testing:

Who is benefiting?

Who is not benefiting?

Who is excludable?

(Behind the scenes I am trying to figure out why the prior HR person didn't auto-distribute to a terminated person even though she wrote him a letter stating that she would do so if she didn't get the forms returned by October 2001. His balance at 3/31/01 was approximately $2700 and there were no future contributions. She took this language directly from a letter from the plan recordkeeper as they were terminating the plan. His money was left in the plan until he requested a distribution in 2006 -- by 06, his balance was almost $4,000).

I remember that the amount that could be auto-distributed out to a terminated employee changed, but I can't remember when or by how much. It added on a chance to rollover to an IRA between two amounts also. Is there anyone out here that remembers where that amount stood in 2001? And when the change occurred?

I know sometimes it can be dependent on the plan, but I am mostly looking for what the IRS/DOL would have allowed in 2001 to see if that is the possible answer to why the scenario above occurred.

Unfortunately I was out of the 401k side of the business from 1999 to 2005.

This is a TPA question for the 50-100 employee groups. Does anyone know of any good TPA's that go down to 50 lives & operates in the Philadelphia area?

Thanks

edited for clarity

If a 401k safe harbor plan calls for 3%-of-pay, non-elective employer contribution and employer also makes non-matching, profit sharing contributions, would those that receive the 401k safe harbor non-elective 3% but no part of the profit sharing contributions be considered as 'benefiting' for purposes of minimum coverage of non-matching employer contributions?