I've read this forum as best I can and appreciate all the time and effort some of you have taken. I have not found another incident similiar to the one I find myself in.

My wife divorced her 1st husband in 1990, a DRO was drafted and sent to his pension. In May of 1991 A QDRO was entered with court. Wy wife recieved a copy of the signed stamped order and letters from her attorney to both the plan administrator and opposing counsel. In his letter to her he states...."please find enclosed a conformed copy of the QDRO which has been signed by the Judge. Please be further advised that we have sent the pleading on joinder of the pension Plane via certified mail to Primerica. We arealso sending a conformed copy of the QDRO th the plan administrator".

My wife's ex husband died of cancer last November and when she went to inquire about her half of the pension she was told that the pension plan had no record of her QDRO. She forwarded a copy of the QDRO and was sent back a form letter saying "Domestic Relations Order Reciept Denial Attachment" with the reason that the participant has commenced the pension benifit and there is no further benifit from the plan.

The funds were rolled into a trust and the trustee acknowledges he has the funds but states my wife needs to go get a court order. The attorney who handled her case says he did everything right and that going to court is a better and cheaper recourse then sueing the pension plan. He is checking since he's not a probate attorney who if anyone you could serve since the ex husband is dead. My understanding (please correct me if I'm wrong) is that the pension has a clear ERISA violation if they did in fact receive a valid QDRO. As a former trustee in a pension plan I know the penalties for violations are not small.

Thank you for any and all who read this, thoughts and suggestions are appreciated. It will take a minimum of $5,000 or so to get the requested court order. Assuming valid service is possible is this a worst case or would litigation ensue even here. My concern on "proof of service" is that apparently this dragged on from the May, 1991 QDRO until April of 1992. Is is possible her attorney "dropped the ball" or is this ongoing exchange proof enough? To further complicate things the ex father in law was an officer of the company in question and personally visited the plan administrator to faciiltate getting a finalized QDRO (this is documented).

We know the funds are in a trust and assuming we have valid proff of service can we compell the pension fund to reclaim the funds from the trust or compell the trust to release the funds using the current (assumingly valid QDRO). What is the best way to check if the QDRO we have is valid or see if it was ammended/challenged after May 1991?

If the plan's recordkeeper is not going to provide vesting information on their statements so that the plan will instead be providing an annual vesting statement, does anyone know when the first statement must be provided?

Assuming the plan is participant directed, would the first annual notice need to be provided by the date the first quarterly statement is due, I believe May 15, 2007? Or is some later date acceptable?

Thanks!

2 Cos. are a controlled group.

Co 1 has no owners on payroll, no HCEs, no Keys.

If Co 2 has Safe Harbor provision in the 401(k). Must Co 1 also have Safe Harbor provision?

Co 2 has about 50 EEs and Co 1 has 4 so coverage issues are not in play. No other plans or contributions other than 401(k) defs and SH match in each company.

Thanks

Facts:

Roth IRA holder is over age 59-1/2

Roth IRA opened with contribution on 5/15/1999

Took total distribution of entire Roth IRA balance on 6/22/06

Rolled over total amount of 6/22/06 distribution to new Roth IRA on 7/30/06

Took total distribution of entire Roth IRA balance on 1/25/07

Is the 1/25/07 Roth IRA distribution qualified?

Pub 590 and other guidance states the five-year clock starts the year for which a Roth IRA contribution is made. It does not say it starts the year the Roth IRA contribution is made, so it appears to be a loophole in which a person can open a Roth IRA, however small, take a distribution after five years, even closing the Roth IRA, and this preserves that taxpayer's qualified status for all subsequent Roth IRA distributions.

What am I missing? Any help is appreciated.

Thank you.

Two questions.

I have a plan that has 88% of the ownership in Trust under a deceased persons name but for the benefit of his wife who is living and owns 3% on her own. Should I be counting the Trust shares under her for a total of 91%?

Also, when determining the top paid group - 20% comes out to 3.2 employees. Do you round up to 4 or down to 3 in this case?

Thanks!

We have a new 401(k) plan effective 1/1/2006. Participants were eligible to make contributions until 7/1/2006. As of 7/1/2006 there were 100 participants. Is an auditor's report required to be filed with the initial Form 5500? Technically, as of the first day of the plan year there were no plan participants?

How restrictive should a 457 plan be for granting a hardship withdrawal for imminent foreclosure on a participant's primary residence. Would a default letter from a mortgage company or bank threatening foreclosure proceedings will begin by a certain date if the mortgage is not brought from arrears be enough to grant a hardship or would foreclosure proceedings actually need to begin?

I have noticed that when the bank actually begins foreclosure proceedings it goes to an attorney and the participant incurs substantially more debt to pay for attorney fees and other expenses to begin the public sale of the home.

Thanks.

First paragraph of letter received from the Department of the Treasury dated 2/2/07:

"This letter is to acknowledge the receipt of your letter dated July 27, 2006. I apologize for the long wait of the response for your request, we are currently in a pilot program for 6 months that will end in March, only until September a decision will be made, and then letter forwarding will be input with this pilot so hopefully we will be able to work efficient, thanks for your patients."

Do you think its time for us to use a lost participant service?

Company A had a 401(k) plan. In 2006 employees of Company B, which is considered a single employer with Company A, were allowed to make elective contributions, but Company B had not adopted the plan in 2006.

Is there some way to correct this (now in 2007) without a huge amount of effort?

I see that you can correct inclusion of employees who did not meet age and service requirements by a retroactive amendment and a determination letter request, but the reason these employees shouldn't have been included is because the employer hadn't adopted the plan (not because they didn't meet age/service conditions).

Is it too late to make a retroactive amendment under general remedial amendment period rules? I think it may be because this would probably be characterized as a discretionary amendment and we're past the end of the Plan Year.

I'm not even sure if this qualifies for VCP.

This seems like something that ought to be correctible because the companies are a "single employer," and employees weren't hurt.

Any words of wisdom would be appreciated.

A DC plan wants to offer everyone the right to receive an in-service distribution but only for a limited period of time. Do you see this as a 411(d)(6) violation once the period ends? I can't find anything yet that makes me think this is allowable.

Under the new executive compensation regulations, do issuers have to disclose ESOP allocations in the "All Other Compensation" column of the Summary Compensation Table? My reading of the regulations indicates that they do, but I have not seen one proxy statement filed under the new rules that include such disclosure (although issuers do disclose company contributions to 401(k) accounts). Any advice would be appreciated.

I understand that, while all participants have to be given the right to open an IDA inside of plans that allow for them, there are certain restrictions, such as asset level that can keep participants from opening an outside brokerage account. For instance, I have heard of plans requiring participants to have at least a $25,000 account balance in order to open an account. Is there a maximum on this minimum account balance requirement?

What other types of restrictions can a plan sponsor place on IDA's?

Thanks in advance!

When PPA originally came out, I know that it said that guidance would be forthcoming, with regards to the default investments used inside of Safe Harbor plans. Basically, this was citing the use of overly conservative default investments, which were keeping participants from realizing a reasonable amount of growth. I have not yet seen that guidance. Have you?

I've been reading 105(h)(5) and 1.105-11, and I just can't find any clear answers about who is "among the highest paid 25 percent of all employees" ?

Is it nothing more than looking at the number of employees as of the end of the plan year, ranking them by 415 comp, and calling the top 25% highly compensated individuals? Or, do you need to include the comp of any employee who received a reimbursement but may have left before the end of the plan year? Is it possible to make a determination who is top 25% in the middle of the plan year?

XTitan

I have a contractor client who has union employees and office staff. The union employees participate in a union sponsored DB plan and the employer contributes $4.8 per hour to the union db plan. I am comfortable with the deductibility issue for the company. My question is how do you calculate the 415 limit for each participant? I have 401(k) contributions and a modest employer profit sharing. I would appreciate any thoughts you could provide to help. Many thanks for your efforts on our behalf!!!

A prospect with a 32 participant DB plan indicated to us that:

1. Their plan does not allow any more new entrants hired on or after [date].

2. The usual benefit accrual formula continues for all who entered the plan before [same date].

To me, it seems likely that this plan will eventually fail the ratio percent test when testing all employees who would normally have have entered without regard to #1 above (it might already fail, I have yet to see the data). When that happens, even if we run an average benefits test, how will such a plan continue to satisfy 410? I'm not sure that a 'hired after' date works as a reasonable business classification...

Can we just ignore all of the employees hired after [date] when we do the coverage tests? If so, where's the code/reg or other cite for that? If the benefit accruals were frozen, sure, but that's not the case here. Am I missing something?

I have a client that wants to cause his IRA to purchase property from a 501©(3) non-profit organization.

The non-profit was organized several years ago by the IRA owner as a corporation without stock.

The IRA owner does not serve on the board of directors, but serves at the board's pleasure as the executive director.

Because there is no stock, it seems 4975 technically does not apply to cause the transaction to be prohibited and disqualiy the IRA under 408.

I must be looking in the wrong places as I cannot find any thing on point.

If anyone knows the cites to any rulings that address this, such would be greatly appreciated. Thank you.

Can an employer have different eligibility provisions for different groups of EE's in a safe harbor 401(k) (assuming they pass coverage)?

For example: one plan, two employee groups. Group A is eligible to contribute and receive standard safe harbor match after 3 months of employment and age 21. Group B is eligible for the exact same contribution rate and match but not until after completing 6 months of employment and age 21.

If the two groups pass coverage, is this permissible?

A client wants to start a business but has no liquid assets. He does, however, have an IRA. He would like to direct his IRA to purchase stock of the company he wants to start. I am looking at IRC 4975 and am thinking that this would be a prohibited transaction but IRC Section 4975©(3) has a special rule for IRAs that might (??) allow it?

How do you read 4975's application to this idea? thanks in advance.

Sorry, posted this somewhere else but it probably should be here:

Can a non-parent company in a controlled group arrangement file for a QSLOB election?

I am advising a plan sponsor that is part of a control group, which I think is in an industry outlined in Rev. Proc. 91-64 and I believe the plan sponsor is the only one in that industry in the control group -- so I believe the safe harbor is satisfied. My client, near the bottom of the food chain, has qualified plans and the only other qualified plans in the control group are sponsored by the parent.

Can my client file the 5310-A or does the parent company have to do it? Any input would be appreciated.