if you have multiple lines of coverage with different policy dates how do you know what the plan year is to file the 5500?

We have a small DB plan with about 40 total participants and our plan year is the calendar year. Do we still have to distribute a Summary Annual Report for PYE 12/31/06 and a PBGC Underfunding Notice? Is there anything new to be distributed this year?

What notices will we have to provide during 2008?

Is there a web site I can go to read a summary of the rules?

I know there was a similar post below, but in this case, the cycle A deadline was missed (for no good-faith or excusable reason). Is a VCP submission required? Is the plan's qualified status in jeopardy? Can/should we file off cycle as soon as possible? I can't find any information with respec to the consequences of missing the deadline.

I'm pretty sure it can't be done, but I'm at a loss as to where I would find a statute, regs, or case law which says so.

A multiemployer fund wants to provide a benefit only for those participants who are actively paying their union dues. I don't know if this would fall under labor laws, but I thought ERISA also required benefits to be provided to similarly situated participants and therefore this would violate ERISA. Does anyone have an idea?

If a 5500EZ must be amended to a 5500(owner hired an employee and did not inform us), does the $750 late filing fee apply? Thanks.

Linda Michals

My understanding is that PPA now allows a cash balance plan to define the accrued benefit and present value of the accrued benefit to be the hypothetical account balance.

Of course the account balance is converted to an act equiv. QJSA as normal form of payment.

And of course the balance cannot exceed the 415 lump sum limits and likewise the annuity cannot exceed the 415 limits.

Finally when computing current liability.

Does it make sense to again use CL as being the account balance or is the suggested practice to determine the act equiv life annuity and then use CL assumptions to calculate the CL?

Thanks.

I wwork with old documents that say that hours of service will be credited for an unpaid leave of absence, provided that the company's leave of absence policy is administered in a nondiscriminatory manner. This would apply to all unpaid leave of absence, not just maternity/paternity.

Is this allowable?

Also, some of the plans say that hours are credited only in the year in which the unpaid leave of absence begins. And some say that the hours are credited only if the employee returns to work at the end of the leave.

Does any of this make sense?

Today marks the 50th anniversary of both the original Sputnik and the premiere of "Leave it to Beaver".

Coincidence?

An employee has a retirment account from the Public Employee Retirement System (Ohio). Can these dollars be rolled over into our 401(k) Plan? Is there a specific reg that addresses this type of rollover?

Thanks in advance

My software (Relius) has the option to use several mortality tables. There are several years to choose from, individual or group and male and female to choose. The 1983 Group Annuity Male seems to be the default. Any thoughts?

In Plan specs and in nondescrim testing assumptions, there is an option to choose nearest birthday or last birthday. Can anyone tell me which is the best choice to use for crosstesting?

I think that in Plan specs, Plan Entry Requirements, I want to follow the document for Plan Entry. And I think I want age nearest in testing assumptions for Cross testing. Any thoughts?

If you aren't a baseball fan, read no further!

Hopefully this post will be active until the end of the month. Nice game by Beckett last night. And we'll hope for a Cleveland win in the series against the Yankees. Part of me wants the excitement of a Sox/Yankee matchup, but another part of me can't bear the agony if the Sox lose to the Yankees. We also have two employees in our unit with the unmitigated gall to be Yankee fans, so they will be insufferable if the Yankees were to defeat the Sox. So go Tribe!

Under PPA, does the 90 day revocation apply to all EACAs or does the EACA have to be a QACA?

I have seen quite a few posts here on what happens when someone rolls over their entire account balance in a year when they should have first received a RMD (excess IRA contribution, etc.) Most of these examples seem to relate to correcting something that has already happened. So I want to get some thoughts on the following current situation:

We have a participant who has elected a Direct Rollover of his account balance, but also needs to take his initial RMD for 2007. We informed him of the fact that he needs to take the RMD and that the remainder of his account balance may be rolled over. However, the participant (who also happens to be one of the Plan's Trustees) is insisting (quite strongly) that 100% of the account balance be rolled over to his IRA and that he will take the RMD from there. The IRA custodian has indicated that they "do this all of the time" and it's not a problem.

Naturally, my concern is from the standpoint of the Plan and our administration of it. It seems to me that the RMD is not an eligible rollover and to go ahead and process it as a rollover may be putting the Plan unnecessarily at risk. Upon an audit of the Plan, I doubt the reviewer is going to look at whether the participant eventually received his RMD out of his IRA, but rather the fact that the Plan improperly rolled over a RMD.

Any thoughts on what should be done here and what the Plan/TPA's responsibility is with respect to this situation? Thanks.

BTH

Anyone know the penalties or consequences if a plan fails to timely file a Form 11-K?

We're into October and PPA's effective date is just around the corner. We don't have a segmented yeild curve or a mortality table published for determining lump sums and other 417(e) forms of payment. Delaying implementation of the PPA basis does not seem like a great option due to the potential issues with grandfathering the GATT/GAR basis (loss of relief from 411(d)(6)) and issues with the QJSA possibly not being the most value form.

What are sponsors planning to do about lump sum payments? Some participants need to made elections pretty soon if they are going to take thier lump sum in 2007 rather than 2008. Systems need to be modified and that takes time and time is getting shorter every day.

And what about lookback and stability? Any sense that they will continue to apply to PPA rates? Any ides, hints, or just plain rumors as to when rates for PPA will be published?

I have a plan with a deceased participant whose beneficiaries were subject to 1.401(a)(9)-5;Q&A7. The section specifies the life expectancy for continuing required minimum distributions from a qualified plan in the case of multiple beneficiaries. For simplicity's sake, the Plan Administrator elected not to establish separate accounts. Hence, the life expectancy of the oldest beneficiary was used to determine ongoing RMD's from the plan.

Some of the beneficiaries wish to roll over their share of the participant's remaining benefits to non-spousal IRA's. The plan has no objection and wishes to accomodate the beneficiaries. To the extent necessary, the plan was amended to ensure that it allowed for non-spousal rollovers.

The beneficiaries are now wondering whether the election made by the plan administrator not to establish separate accounts requires that ongoing RMD calculations from the separate inherited IRA's be determined based on the single (shortest) life expectancy, as was the case while the monies were in the qualified plan.

Notice 2007-7 states quite clearly that non-spouse inherited IRA's should determine the RMD .... " if the employee dies on or after his or her required

beginning date, the required minimum distribution under the IRA for any year after the year of death must be determined using the same applicable distribution period as would have been used under the plan if the direct rollover had not occurred. "

If my description isn't clear, please ask for clarification.

A terminated participant was rehired the year after she was paid the vested portion of her account balance. Her nonvested amount was placed in the plan's forfeiture account at the time of her distribution and then used to offset contributions. At the time of her rehire, she had not incurred a 5-year break in service. Regarding rehired participants, the doc only mentions that if the participant pays back the distribution, the earnings and/or forfeitures that would be allocated to the other participants in the year of rehire can be reduced to reclaim the nonvested portion so that she could have her entire balance again, but only if a 5 yr. BIS has been incurred.

It seems that since the doc does not address what to do for rehires who either don't have a 5 yr. BIS or agree to repay the distribution, any method can be applied as long as it's reasonable. The issue I see is that since the plan has individually directed accounts, a PR problem may be created by transferring amounts from the other participants to the rehire (who is a participant on the date of rehire). There are only 4 participants with account balances in the plan, and they are all 100% vested, so there won't be any forfeitures to use for this purpose in the foreseeable future. And, of course, the likelihood that the participant will pay back the distribution is practically nonexistent. The amount of the nonvested balance is only about $600, but we would like to have the employer handle this as appropriately as possible - what should be done in this situation?

The company owner took a loan out of their 401(k) account 9 months ago. No loan policy was adopted. The "employer checklist" attached to their document indicates that the plan will NOT provide for participant loans.

The IRS talks about discretionary and interim amendments and the deadlines that apply. However, isn't a participant loan more of a DOL issue - what is the timing requirement to adopt a loan policy? I believe it must be done before the loan is made, but I have not found the official cite for that.

Any guidance is much appreciated.

Oh, just for fun, as I'm sure you've guessed, the loan exceeded $50,000 and no payments have occurred yet. We are currently trying to find out if we could turn this into an in-service distribution, and deal with the tax withholding problem.

I am auditing a set of financials for a Plan for the 1st year that they were required to attach audited financials and file Schedule H on their 5500 (i.e. they had >100 participants at beginning of 2006 as well as at the end of 2006.

My question is: Do I need to present a comparative statement of plan assets? How about a comparative statement of net changes in plan assets? No audit was done for 2005.

Can a we submit a comparative financial with the 5500 where we indicate that the prior year data is UNAUDITED?

Any help is appreciated!

-Jim