If a retirement plan only has the owner as a participant, does the plan need a fidelity bond?

401(31)(a) what does this new law entail? Does it primarily affect rollovers?

For the eligibility requirements for entry into a retirement plan, if you have an eligibility period of only six months, does that mean that you have to use elapsed time for the initial eligibility period?

Employer funded plan stipulates election to add dependent during special enrollment period (i.e. mid-year following qualified event) must be submitted no later than 31 days post event - birth of dependent in this case. Employee missed deadline and appealed for exception. Employee is currently enrolled in family plan with wife and one dependent, birth of second child is qualifying event.

Can an exception be granted without inviting undue scrutiny from IRS under IRC 125? If IRS took issue with the exception, would exclusion from income be denied to all plan participants or just affected employee? I couldn't find this specifically addressed elsewhere. Thanks.

Perhaps, government actuariess need to read this and learn the error of their ways -- there was never any need to replace the Wigglesworth table so long as you can control retirement age !

This balderdash is all over the net and sounds like rediculous propaganda to encourage aging (and high-priced employees) to retire. I found no professional replies to it. Clearly, the way to beat this game is don't retire.

Anyone ever read Darrell Huff's How to Lie with Statistics?

Life_Span.pdf

Payment to a participant was to have been made under the nonqualified plan in 8 annual installments following separation from service, which occurred last August. The first annual payment was to have been made in November, 2007. (Not a public company) Due to an unintentional error, the November installment was not paid. It will be paid now, in May. Because the error was not discovered in the same taxable year (2007), we can't use Notice 2007-100 Part II to correct this without penalty. Part III suggests that we would tax the payment in 2008, and apply the 20% tax to that amount. Any other ideas about how to "correct" and report the correct amount? The dollars at issue are small; e.g., the installment is less than $5,000.

Somebody is arguing that distributions on account of disabilty are tax exempt?

I don't think so but don't have anything to dispute it (without doing some digging).

Incidentally, to broaden the question, what type of disability payments are tax exempt? For example, are the disability payments from an employment (under the disability insurance) taxable?

I have a question about what Prop. Reg. 1.430(j)-1 says.

Say you have a plan where the sponsor puts in $49,800 on 4/15/2008, and then the 2008 quarterly requirement turns out to be $25,000. So, they've put in almost double.

Do you (in effect) get to credit interest on the extra $24,800 to 7/15/2008 (say the effective rate is 6%), so that you can skip the 7/15/2008 installment, or do you have to put in $200 by 7/15/2008? If you think you can skip 7/15/2008, where in 1.430(j)-1 or its preamble, for that matter, does it say you can? Thanks.

Would a plan be permitted to have immediate eligibility, but have a 6 month or 1 year wait for automatic enrollment to kick in? Would the answers differ if it were an EACA or QACA?

Thanks!

Profit Sharing Plan that has J&S provisions, so requires spousal consent on distributions over $5,000.

Active participant is requesting a Hardship Distribution and has a balance of less than $5,000. Is spousal consent required?

Thanks.

Hello everyone!

I recently read about this "rule of thumb" to use when determining how much money a particular individual should invest in stocks vs. bonds. Take the number 110 and subtract your age, this number is the % of your retirement that should be invested in stocks. I am concerned because for me, it comes out to 73% and currently I have 90% invested in stocks, (in a Target Retirement Fund). Does anyone have an opinion about this either way? I should mention that I was introduced to this concept in David Bach's book, Smart Women Finish Rich, which I found very informative. Any feedback would be greatly appreciated. Thank-you! P.S. I know David's book should be underlined, but I can't get the control to work.

Company A merges its MPPP into its P/S plan. The MPPP money is subject to the QJSA rules. Does the P/S plan have to be amended to comply with the QOSA rules?

An employee was participating is employer A's (non-Gov't tax-exempt org) 457(b) plan and terminated employment. He had elected to receive payments in 5 annual installments beginning 2010. Since then, the employee has become employed by employer B (also a non-Gov't tax-exempt) that also has a 457(b) plan for which he is eligible. Both plans allow for transfers and receipt to and from other 457(b) plans of private tax-exempt organizations.

1. If the employee transfers his account from employer A's plan to employer's B, does the elction he made of 5 annual installments effective 2010 remain in place? And if so, how can the distribution occur while still in-service?

2. If he had originally elected a lump-sum upon separation from service but elected to transfer the account prior to the distribution date, can his account be transferred to plan B and take on the features of the new plan and any new elections allowed?

I have an existing 403b plan with an Profit Sharing provision. We are amending the allocation provisions of the PS portion of the plan to become a New Comp (previously it was a straight proportion of pay PS). In running the a4 non discrimination tests, do I include the 403b deferrals in my average benefit test?

Would the answer be any different if my 403b deferrals were in a Non ERISA 403b plan?

Plan began an automatic enrollment program in 2007 at 2%. (Just a regular automatic enrollment plan , not EACA or QACA). Now, client wants to raise the automatic enrollment deferral rate to 3%, BUT ONLY for new enrollees. They do not want to up the % for prior enrollees.

May they do that?

Thank you.

Employee contributions (voluntary and mandatory) are not deemed credited to a participant's account for a particular limitation year unless the contributions are actually made to the plan no later than 30 days after the end of such limitation year (see Reg. 1.415-6(b)(7))

For a 401(a) plan what would be an example of this occuring and must this rule be automatically applied. We receive contributions thru payroll deduction. I can't believe that in the situation where aftertax contribiitons are submitted > 30 days after the payroll end date and the fiscal year has ended, that the contributions needs to be applied to the current fiscal year rather than the prior year.

Assuming this is true then what about attribution to the plan year for purposes of ACP testing?

Thanks

My 501©(3) employer has two 403(b) plans/programs: (1) The first plan (employer-sponsored, and fund sponsor vetted by employer) is a non-ERISA 403(b) TDA plan begun about 1971 or earlier with an insurance company. There is no Plan document--just individual annuity contracts ("flexible premium annuity"), with addendum updates as mandated by the Internal Revenue Code. As a result of a salary reduction agreement with my employer back in 1971, my employer remits to the insurance company my monthly contribution of pre-tax dollars; I have not contributed after-tax dollars to this plan. Also, there are no employer contributions to this plan. My employer states it is a "church" plan [a 403(b)(1)]; no Form 5500 has been filed on an annual basis for this plan. After some 38 years or so, my employer is stopping/deselecting/freezing/terminating (employer FAILS to explain precisely what mechanism is being used for stopping the plan: deselection, freezing or termination) this non-ERISA 403(b) TDA plan. I'm not sure, but I may be the sole remaining participant in this plan. I am still working and am over age 59 1/2; thus, my age qualifies me for an "eligible rollover distribution". My non-ERISA 403(b) TDA contract allows for a distribution after age 59 1/2 and allows for a "direct rollover (trustee-to-trustee)" to an "eligible retirement plan". The non-ERISA 403(b) TDA contract specifies that "a tax-deferred annuity as described in Section 403(b)" is one such "eligible retirement plan". The non-ERISA 403(b) TDA contract only mentions "direct rollovers (trustee-to-trustee)" as a mechanism for moving an accumulation from its contract.

(2) The second plan (employer-sponsored, and fund sponsor vetted by employer) is a ?non-ERISA/ERISA? 403(b) TDA plan [403(b)(1)] begun about 1976 with a financial institution other than the insurance company. [i've received contradictory information from the financial institution and my employer as to the non-ERISA/ERISA status of this second plan. I have 2 letters from the financial institution that state that the (second) plan is subject to ERISA. On the other hand, as of December 31, 2009, my revised Summary Plan Document (for the second plan) states that, in fact, this second plan is a non-ERISA 403(b) TDA and is a "church" plan as well! I contacted my employer's former CFO (who, PRIOR TO 2009, had always filed Form 5500s ANNUALLY for years and years for this second plan) and asked her why she filed Form 5500 for the second plan. She responded she did so because she thought the plan was subject to ERISA! I'm beginning to wonder if both the current CFO and the former CFO of the company for which I have been working the past 25+ years REALLY KNOW if this second plan is subject to ERISA or not! Why would a Form 5500 be filed annually PRIOR TO 2009 for a non-ERISA 403(b) TDA "church" plan? If this second plan is a non-ERISA 403(b) TDA "church" plan, why didn't the IRS return the FILED Form 5500s back to the company? Does the IRS allow employers to file Form 5500s as a "HEDGE" against the POSSIBILITY that the employer's plan MIGHT BE an ERISA 403(b) TDA? I'll always have big questions in my own mind about the non-ERISA/ERISA status of this second plan!] A Plan document and Summary Plan Description for this ?non-ERISA/ERISA? 403(b) TDA plan has been in existence for years and years. Since about 1976, I have been contributing pre-tax dollars to this plan as a result of a salary reduction agreement with my employer; I have not contributed after-tax dollars to this plan. There are employer matching contributions to this plan (up to a certain percentage) in addition to the employer contributing a "free" 2% of my salary without a 2% match from me. A Form 5500 is filed annually for this plan (short version; few schedules). My employer is keeping this ?non-ERISA/ERISA? 403(b) TDA plan viable. The ?non-ERISA/ERISA? 403(b) TDA plan only accepts rollovers of "eligible rollover distributions" and will only accept either a "direct rollover (trustee-to-trustee)" OR an "indirect/60-day rollover". Thus, the only way I can get my money from the non-ERISA 403(b) TDA plan into the ?non-ERISA/ERISA? 403(b) TDA plan is by doing a "direct rollover (trustee-to-trustee)" OR an "indirect/60-day rollover" of an "eligible rollover distribution".

Question:

Am I allowed to execute, specifically, a 403(b)-to-403(b) "direct rollover (trustee-to-trustee)" in order to get the "eligible rollover distribution" from my employer's non-ERISA 403(b) TDA plan (which is being deselected/frozen/terminated) to my employer's ?non-ERISA/ERISA? 403(b) TDA plan? THE PROBLEM IS, the form given to me by the insurance company is "cleverly" designed and steers me towards an "indirect/60-day rollover" (where I would have to come up with $47,200 of my own money in order to have a "complete/full rollover" of monies due to the 20% of the accumulation being removed by the insurance company for tax purposes) with no mention whatsoever of a "direct rollover (trustee-to-trustee)" option to another 403(b) annuity contract, which would cost me nothing! What about IRC 401(a)(31) and 403(b)(10) and 1.403(b)-2 and EGTRRA and being sent a Section 402(f) notice (which I never received!)? It's almost as if the insurance company wanted to make the rollover "difficult/impossible" by not giving me the 402(f) notice--I'm sure they weren't happy to say "bye bye" to several hundred thousand dollars! When I challenged the insurance company about their rollover form not making it explicit that I had the "direct rollover" option to another 403(b) annuity, they backed down and said that the form they had sent me was out of date and that I could "adjust" the form. The problem with that reply was that the form had just been revised -- (there was a very recent revision date in the lower left corner of the form) -- prior to my "direct rollover," so their "excuse" did not pass muster! As it was, in addition to filling out the "Rollover/Transfer" form in a manner that reflected a "direct rollover," I also sent a clear and concise letter to the insurance company and the financial institution informing both of my "direct rollover" intentions. This letter (2 copies, each copy addressed to both the insurance company and the financial institution) accompanied the "Rollover/Transfer" form. Had I not done some research on my own, my husband and I might not have been able to pull off this "direct rollover" transaction. Frankly, the entire rollover experience was nothing short of a NIGHTMARE . . . . my employer gave me NO help, the first attorney I hired was of very little help and let go, a second attorney (with considerable difficulty) was able to pry out some information from the insurance company (that wanted to hang onto the accumulation my husband and I wished to roll over), and my financial planner was totally unfamiliar with 403(b) products in general. I would hate to tell you folks what this transaction cost me in terms of fees to the attorneys and financial planner! FOR THIS REASON I HAVE GONE INTO A VERY DETAILED ACCOUNT OF THIS TRANSACTION, HOPING THAT IN SOME WAY I CAN IMPART SOME INFORMATION THAT MIGHT BE USEFUL TO THE READERS OF THIS SITE.

Let's assume that a particular medical transcriptionist is properly classified as an independent contractor, but has been permitted to participate in an employer's money purchase pension plan, in violation of the plan's terms. This has gone on for a couple of years; she has partially vested in her account.

There is a violation of the exclusive benefit rule and, under PLR 9546018, seems that her account balance is forfeited and the money remains in the plan to be used however forfeitures are handled under the plan. What type of reporting does this require?

Anyone handled this type of situation?

Any other thoughts on alternatives? Additional issues?

I work for a large employer that offers a group health insurance plan that would be primary to Medicare. We have an elderly worker (77 years old who worked for us for 41 years) who does not wish to participate, but wants to go on Medicare. Does anyone know what happens with Medicare if they are eligible to participate in our plan and choose not to participate? I have searched CMS website and the web looking for what happens if the employee chooses not to join the health plan. Is she still eligible for Medicare? Thanks for your time. All leads welcome!

The new EGTRRA Volume submitter has a check box to choose "Each Participant constitutes a separate classification" I am thinking about using this for every 401(k) Plan. This would give extra flexibility in the future as goals and circumstances change. I believe I can allocate on a basis that happens to match permitted disparity. And, since I will not have Permitted disparity in my document, I will not need the PPA disclosure for it.

I think every year I will be able to choose the integration level.

This seems to good to be true. I would sure like to hear what others think.