An employer current has a calendar year safe harbor 401k plan. They want to convert to a Simple 401k effective 1/1/07. The plan would have to be amended by Dec 1 to revoke 2007 safe harbor - by what date must the plan be amended to adopt Simple 401k for 1/1/2007?

Are there amjor institutions Merrill? Fidelity? That handles transfers from an 401(k) format to a 457(b) format?

Obviously, participant contributions/loan repayments that are not timely remitted to a plan's trust (i.e., as soon as administratively practicable) are a prohibited transaction and, if the time period for remitting such contributions to the trust is specified in the plan document, an operational failure to follow the plan's terms.

What if a plan specifies the time period (e.g., monthly) for remitting matching contributions and that period is not met? It's an operational failure to follow the plan's terms, but is it also a prohibited transaction (i.e., impermissible extension of credit)?

Are most out there fixing the prohibited transaction issue through VFCP, Form 5330 or both?

Rev. Proc 2006-27 adds new loan failure correction methods, but indicates that the corrections only apply if the failures are submitted under VCP. Since EPCRS usually provides that self-correction is available if the correction methodology specified in the rev. proc. is followed, this seems a bit out of step. Has anyone heard anything different on this issue or received any indication that the IRS may reconsider? We have a loan default in a plan with a large number of participants...seems a shame to have to correct under VCP and pay a huge fee just to correct one loan failure. Hmmm...

DB plan will be terminating 12/31/06. Client will be filing for a favorable determination letter as part of the termination process.

1. Would former participants otherwise eligible for a distribution from the plan (i.e., attainment of early or normal retirement age) during the FDL process be eligible to receive a distribution or must distribution wait until the FDL is received? If former participants must usually wait, is there an operational failure to follow the plan's terms?

2. Would participants active as of the termination date have to wait until the FDL is received?

3. If either or both categories must wait until the FDL is received, how should this be handled if part of the plan includes a cash balance element and the FDL could take much longer than normal?

Thank you in advance.

The new timing rules under the proposed 415 regulations provide that certain amounts payable within 2-1/2 months after severance will not fail to be 415©(3) compensation. Employers may presently rely on this timing rule. If an employer wanted to rely on this rule now would it have to adopt an amendment or could the employer merely adopt this rule in operation?

an ER has a fringe benefit plan that provides for an $8K relocation reimbursement to be used within 12 months of the date of transfer.

the client wants to hire an EE who potentially would not use the relocation reimbursement for 5 years (spousal job and house issues). so, ER proposes to make an exception for this potential EE whereby he can get $7K (notice, it's $7K; not $8K as specified under the SPD) to be used at his discretion over a 5-year period.

1) can a side letter accomplish the ER's goal of, what is in effect a modification of the fringe benefit plan, changing the relocation policy just for this one EE;

2) what about the constructive receipt of the $7K?

it would be much simpler if the EE knew he would be using the $7K relocation reimbursement provision w/in this or next year, but to have a 5-year window in which to exercise the right?

thanks for any help you can provide.

Do i need to report all the financial custodians and institutions if the plan has more than 10?I noticed that there are 10 fields for it. Do we have rulings if the plan ahs more than 10 custodians?

As an attorney, I assist a plan administrator in determing whether DROs are qualified.

I'm about to 'reject' a proposed Order that purports to amend a QDRO accepted in 2000.

In 2000, at the time of divorce, the ex-wife/Alternate Payee expressly waived (in the QDRO) any interest in the pension, but did take in interest in the 401(k) Plan.

Now, 6 years, later, participant's Pension is in pay status already, and ex-wife has submitted a proposed amending order seeking a 100% INTEREST IN THE VALUE OF HIS PENSION AS OF THE DATE OF HIS RETIREMENT.

Since he's already in pay status, I'm planning to reject on the basis of the Order requesting benefits not available under the plan. (Some of his pension has already been paid to him, so she can't get "100% at this point).

This feels funny in other ways, though. He's now in a nursing home. His two kids' names are on the order as his "agent" (but her attorney drafted the amending order.).

Plan is inclined not to accept any amending order, even if they refine it to a permissible benefit.

This is under Pennsylvania state law.

Any ideas on the kind of documentation, etc. Plan Administrator could say it would require before considering approving such a request?

Thanks for any insights.

In the meantime, sorry, Alternate Payee. This one's a no go.

In reviewing the PPA information on adding an automatic enrollment feature to a 401(k) Plan, it states that contributions must be placed in a multi-asset class default investment if the participants do not direct the investment of their elections.

I deal with a handful of plans where a new plan participant receives a brokerage acccount with a designated brokerage company, and then he or she is responsible for calling the "plan broker" to place investments within the account. If I wanted to add automatic enrollment to a plan such as this, what is my default "multi-asset" class investment?

Thanks for any replies.

Safe harbor plan uses a matching formula which satisfies both ADP and ACP safe harbor. The plan also includes an additional Match which is "not" intended to satisfy the ACP safe harbor. This additional match has a last day requirement attached to it. Is this permissible under the '04 k/m regs. and just test this under ACP?

I know the new regs. clarified the fact that an additional match that is intended to satisfy ACP safe harbor can not have an hours or last day requirement. But what about the additional match that is not intended to satisfy ACP safe harbor? Seems odd that a nonelective safe harbor plan can have a match with the restrictions and test under ACP but this would be prohibited.

a client and his brother own several companies with one of the brother's daughters. the brothers want to split up the companies so, at the end of the day, the two brothers own four of the companies and the daughter owns three of the companies on her own. currently, all 7 companies have a single 401(k) plan. as part of the exchange, all of the contracts have to be bifurcated, including the 401(k) plan.

i am thinking that the best option is a termination of the 401(k) plan. i have looked at the controlled employer regs and affiliated service group regs, which i don't think apply. the daughter found an investor who is going to run the companies with her, so that she and the investor will be 50-50 owners. the brothers are going to own their own companies 50-50, so none of the 80%/50% controlled employer requirements will be satisfied and the companies are not performing services for each other, so the affiliated service group regs are not implicated.

does anyone have any thoughts? am i overlooking anything?

thanks to anyone who can help.

under PPA, does the normal form for a single person have to be straight life or can it still be the actuaries decision (like life and 5)?

Prepare to waste your time...

http://us.mms.com/us/dark/index.jsp

ZERO - number of runs scored by Yankees in the 3rd game of the playoffs

ZERO - number of runners advance by the Yanks in the same game

ZERO - number of World Series won by the Yankees in the 21st century.

ZERO - oh wait - A-Fraud did get a hit afterall.

gotta love those results.

especially for a payroll over 200 Million.

Saw this post from 2000, but wondered if anyone could tell me if they currently use a good application that tracks the information necessary for retirement plan admin. One that can roll data forward from year to year and also flexible as far as being able to pull data for different types of management reports.

Any input would be appreciated!

http://benefitslink.com/boards/index.php?s...ost&p=18478

Can anyone direct me to anything that relates to procedure/dos/don'ts/etc regarding the changing of Safe Harbor match formulas?

Can you change mid-year? What about notice to participants?

I know what can come into a 401(k) plan, but can a 401(k) distribution be rolled over into a Roth IRA?

Mike

We recently took over the administration of a small governmental 403(b) -- deferrals and nonelective contribs -- and the prior TPA filed full 5500s for the plan -- 5500 + Schedules A thru SSA. Any advice on how to stop w/o raising any red flags?

we have a client who has a US ESOP and a candian subsidiary. the canadian EE do NOT participate in the US ESOP as of yet.

could someone pls tell me:

1) are there any specific changes that have to be made to the ESOP's plan document to reflect the canadians' inclusion (whose income is not pegged to a W-2)?

2) can the ER currently deduct contributions made on the canadian EEs' behalf; and

3) is there anything i am missing (i read the US-Canadian treaty and don't feel like there is any impediment in that to make us shy away from including the Canadian EE)?

i am desperate for guidance on plan drafting.