Is it possible for a plan not to allow someone of retirement age to take a loan from their 401(k) even if they are actively employed?

Our recordkeeping system (OMNI) seems to prevent a participant from taking a loan if they have already reached retirement age or if the terms of repayment exceed the number of years until the participant reaches retirement age.

This is so confusing, I am not where to start in correcting it.

Plan failed discrimination test. Money was returned to one HCE.

Now, employer tells us that they deposited $1,500 too much to the account of the HCE who had the refund. This $1,500 was never withheld from his compensation and was not reflected on his W-2. However, it was deposited into the plan as a salary deferral and contributed to the failure of the discrimination test.

The HCE received more than $1,500 in his refund. So, he received a refund of the money that was contributed to his account by mistake of the employer.

Where do we start to correct this problem?

We have approx. 10-20 individuals in a termed DC plan (company is bankrupt) with balances in excess of $5000. We've sent numerous mailings - the last batch was certified with return receipt requested. We've gotten signed receipts back but a few still have not returned their signed election forms. When we've tried to get a phone number to call them the number is unlisted! At this point it seems we've exhausted all avenues. Since we cannot pay out amounts over $5000 without consent, what other options are available?

I have served as a pastor in different roles, both employee and self employeed. I have served with a denomination, presently in a non-denominational church. I desire to take advantage of the 15 years of service catch up contributions. But I don't have 15 years. Since even a self employeed minister is considered an eligilble participant for a 403(B) it seems there is flexibility when it comes to people in ministry. My questions is this - can I just bunch together all my years in ministry or is there a specifics approach I must follow. Thanks.

I have a super top-heavy profit sharing plan whose plan year end is December 31, 2001. During the plan year two of the three participants left (both terminees were NHCE). One was credited with more than 500 hours but less than 1, 000 and one less than 500 hours of service. Obviously, neither were employed on the last day of the plan year. The only remaining participant is the owner who is HC and key and gave himself a contribution for the plan year. The plan document's top heavy provisions include "last day of plan year" requirement so neither of the terminated participants are eligible to receive the minimum top-heavy allocations. However, since one of the terminated emplyoyees worked more than 500 hours she's a non-excludable employee for nondiscrimination testing purposes. However, she is not benefitting. The plan fails to satisfy the nondiscrimination testing for this reason.

Can I allocate a 3% top-heavy minimum allocation to the two terminees to pass the nondiscrimination testing if the plan document allows for a waiver of the "last day of plan year" requirement for the accrual of benefits? I can't seem to find any documentation that addresses this issue.

Thanks!

I've tried this questions before and didn't get any responses so I thought I'd try again.

Any thoughts on how the nondiscrimination rules for 125 plans apply to government employees where the lines between entites are often gray?

For example, could a plan be put in a one state agency but not another if they are on the same payroll and use the same EIN?

Thanks,

Johnny

Is there a minimum age limit when selecting a retirement age in a plan document? For example, what if an employer wanted NRA to be 45? The lowest I've seen is 55, but occasionally an ER will ask if he can use a lower age.

Can the death proceeds of a life insurance policy held under a 457(B) plan be rolled into an IRA by a spouse beneficiary?

A client is using Aggregate funding and has no active participants - all retired and terminated.

Due to the recent market, the valuation produces a present value of future normal (assets less than pvfb).

The client would like the normal cost to be zero and their actuary is telling them to fund the entire difference as normal cost.

I do not believe either answer is correct. I thought there was a prohibition against using the aggregate funding method with no active employees. (My suggestion is to switch funding method to unit credit and deal with the amortization of the base. The client would obviously not like this because they want zero. TBSS - too bad so sad)

Can the aggregate method be used?? IF yes, what is the 'correct' answer for the normal cost??

Any comments are welcome.

Our QDRO Procedure specifically provides than an immediate distribution may be made regardless of whether or not the Participant has attained early retirement age under the Plan. We now find ourselves in a somewhat unique situation - as the Participant and the alternate payee are both employees of the plan sponsor and both participate in the Plan. Therefore, I'm wondering, may we still provide an immediate payout to the alternate payee, despite the fact that she is also a Plan participant and to her own account could not get a distribution until she retires, terminates employment, etc? I would think that her status as a Plan participant would have no bearing on her distribution options as an alternate payee, but that is just my hunch. Any suggestions? Thanks!

Jimmy received a parrot for Christmas. The parrot was fully-grown, with a very bad attitude and worse vocabulary.

Every other word was an expletive; those that weren't expletives were, to say the least, rude. Jimmy tried to change the bird's attitude by constantly saying polite words, playing soft music... anything he could think of.

Nothing worked. He yelled at the bird, and the bird got worse. He shook the bird, and the bird got madder and more rude.

Finally, in a moment of desperation, Jimmy put the parrot in the freezer. For a few moments he heard the bird swearing, squawking, kicking and screaming and then, suddenly, there was absolute quiet.

Jimmy was frightened that he might have actually hurt the bird, and quickly opened the freezer door. The parrot calmly stepped out onto Jimmy's extended arm and said, "I'm so sorry that I offended you with my language and my actions, and I beg your forgiveness. I will endeavor to correct my behavior."

Jimmy was astounded at the changes in the bird's attitude and was about to ask what had changed him, when the parrot continued, "May I ask what the chicken did?"

i have a client that has owns 50% of a c corp (a real estate company). the c corp has a sep plan. this 50% owner would like to establish a separate company that would be a sole proprietorship and he would be 100% owner (also a real estate company). can he establish a sep for the sole proprietorship? he would be the only participant but would also continue to participate in the c corp's sep plan. should i be concerned with affiliation or control group? can you participate in 2 sep plans?

thanks for any input.

I have a company that has a Simple IRA. They now have employees that are going to be eligible for the SIMPLE IRA.

However, the employees are leased.

Can the company include the employees in the leasing company's 401(k) plan and not the SIMPLE IRA.

Or do they have a choice of including them in the 401(k) plan of the leasing company or their SIMPLE IRA plan.

If the leasing company's matching formula is similar to the match of a SIMPLE IRA does it matter which plan the employees are in.

Finally do the employees have to be participants in each plan or can the employer choose which plan to put them in.

Thanks for your help.

I have a client that paid expenses out of the plan to pay for expenses for financial accounting information pursuant to SFAS No. 106. It is my understanding that this is a fee that is not allowed to be deducted from a Plan. What would be the correct way to make the correction to the plan?

Anyone ever heard of a "R" QNEC? Is has been bought up in a sales meeting with a question of whether we can calculate it or not. Heck, I have never even heard of it.

Can someone please provide some reading on this.

Prominent ERISA attorney Mark Dray wrote a letter to the IRS airing his concerns about the need to make plan amendments for "CRA" (the definition of 415 comp as affected by qualified transportation fringe benefit plans -- even if the plan sponsor doesn't have such a fringe benefit plan):

http://benefitslink.com/articles/dray20020909.pdf (should be a clickable link; requires Adobe Acrobat Reader to view - see http://www.adobe.com if needed)

Do you agree with his point that the IRS shouldn't be requiring CRA amendments as part of the GUST amendment process?

Know the thread was here but can't find it. Can anyone confirm or correct me on the following:

safe harbor plan with the sh match. Union ee's disaggregated so you do not have to give sh match to them. non union ee's get the sh match.

safe harbor plan with 3% non-elective contribution would go to all the union and non-union staff.

right?

I work in a bank trust department and we serve as custodian of a MPPP in which the plan sponsor ( the Trustee) would like to purchase real estate to hold in the MPPP. Is this ok? If so, what percentage of the portfolio can the real estate make up?

Is it permissible to define the classes in a cross-tested PSP as follows: Group A is all highly compensated employees. Group B is all other employees. ???

I was in the midst of amending and restating a PSP and found that the TPA had drafted the above amendment some time back.

I typically define the classes somewhat such as.... Group A is all employees who are licensed to practice medicine and who are shareholders of Employer. Group B " " who are not shareholders of the Employer. Group C is all other employees.

Thanks for your help

We are currently in the process of impementing the Relius Preferred administration system, bur are having difficulty deciding on the appropriate Trading Partner. The Partners we have been reveiwing are:

1. SunGard Transactional Network

2. First Trust

3. Security Trust

4. Fidelity

5. Schwab

Our question is which one of these Trading Partners provides the best service at the most reasonable cost. Of course any other comments are welcome. Thanks