Since I'm distinctly not a DB person, I'll spare you the weirdness of this situation and just ask one small question: When you have a terminating plan that wants to offer a lump-sum window, and the AFTAP is too low to allow it without (in this particular case) going with the special bonding rule to allow the lump sum to a couple of Highly Compensated people...

For these purposes - are the "top 25" HCE's or former HCE's determined under the 414(q) definition, or does it mean the 25 highest paid, regardless of whether they are HCE's under 414(q)? I believe it is the former, but I'd love to get confirmation from someone who knows something about all this! Thanks in advance.

My husband retired from two major aerospace companies that were bought out by Boeing.  My husband divorced his first wife, obtained a QDRO during their divorce process.  The QDRO was entered into the divorce record with the court.  Later, we married, I want to get a copy of both of his two ORIGINAL private pension plans, but I am not sure how or where to begin looking for these documents?  I do not trust the Boeing Pension Dept, they hired a third party firm to handle retiree's pensions.  In the last 8 years since my husband's passing, the Pension Plan Division has changed their name at least 3 times as well as their address!  They were very unprofessional in helping me to receive a small death benefit policy.  They finally issued a check to me, and them nearly 2 years later, sent me a threatening letter saying that unless I sent them a certified copy of my husband's death certificate, I would be responsible for repayment of the one time death benefit payment !  I asked them if they really really REALLY have any protocol that would release funds without it then take nearly two years for them to discover such a breach?  I sent them copies of the docs and envelope with return receipt from the USPS.  Yet they continued to threaten me until I sent ANOTHER certified copy of his death certificate !  Finally I re-complied.  My sending them court certified copies several times cost me nearly $150.00, and took over 1 year to finally receive.  Then after all of that, they harrassed me 1-1/2 year later to repeat the nightmare.

So after all of this, I don't trust them to tell me if I have any rights as a 2nd spouse and as my husband's survivor (his EX wife preceeded him in death, with a QDRO).  I know that the QDRO he had with his divorce settlement WAS FILED with the court, though I don't know if copies of BOTH PRIVATE PENSION PLANS were entered into the court record?

I read where if an Alternate Payee/Spouse passes away BEFORE the Participant, the Participant is free of the QDRO arrangements?  Is a Second Spouse (subsequent spouse, SURVIVING spouse) entitled to a private pension plan according to ERISA?  Again, I have ZERO TRUST in the Boeing Pension Dept !  I am hoping that if I can get COPIES of the ORIGINAL private pension plan(s).  If I find or need an attorney, it will cost me a lot less if I already have the original document to present to an attorney.

Thank you very much for helping to clarify this. 

SITUATION ; 

Retired partipant REMARRIES then dies (alternate payee/ex wive PRECEEDED Participant's death)

(full retirement plans from two aerospace companies) 

(a little background) 

(1) Participant divorced, with QDRO agreement

(2) Participant later remarried

(3) His ex-wife aka "alternate payee" died before he did

QUESTION ;

Is the second wife aka his "surviving spouse" entitled to any of his pension benefits ;

(1)  BEFORE participant's death?
(2)  AFTER participant's death?

"What happens to a private pension plan when an (Alternate Payee/EX spouse) before the Participant dies?"
 

Seller is a sub. of holding company.  Holding company sponsors the health plan that seller's employees participate in.  Purchaser buys seller from holding company and merges seller into purchaser. 

My thought is tat seller employees, who are merged into purchaser post-close, receive 2 1095s: 1 from holding company that sponsored health plan pre-merger and 1 from purchaser? 

Does this sound correct?  Thank you so much in advance! 

A single employer has sponsored two 401(k) plans for many years. One covered employees hired prior to a specific date and the other covered employees hired after a specific date. All 30 employees of the company are covered by one plan or the other depending on when they were hired. Both plans are now much the same.

The employer now wants to just maintain one 401(k) plan and cover all employees under one plan. There has not been any company sale or acquisition here. 

Are there a number of special rules involved in merging plans like these?

Participant divorces his spouse/alternate payee in the 2000s and the divorce decree directs that a QDRO be drafted to split the participant's retirement account 50% between the participant and spouse/alternate payee for the period of the marriage.  QDRO is never received by the Fund.  Participant and spouse/alternate payee get re-married several years later and participant recently applied for pension benefits.  Does the Fund need to find out whether a QDRO was drafted?  Does the Fund need this QDRO before processing participant's application for benefits?  Any guidance appreciated.

A plan participant needs spousal consent since he wants to receive 100% of his accrued pension benefit. However, the spouse is in Haiti, and they have not spoken in years, and numerous attempts to contact her have not been successful. Is there any relief available here or will he just have to keep trying to get the spousal consent or elect a 50% QJSA?.

For a money purchase plan participant the only asset in her account is a life insurance policy with a cash surrender value. She has to take required minimum distributions so i assume the RMD would be take each year from her cash surrender value. Agree? However, the plan sponsor was not aware of the ability to use cash surrender value for RMD  and instead used other plan assets to pay her RMD through the years. Now the policy has a zero cash surrender value. Would you agree that the employer has the responsibility to make the plan whole given that the cash surrender value is zero?

This plan is terminating and there are several DB participants who will not complete their distribution forms.  It is a PBGC plan.  Two participants are still employed and so I think they can be coerced.  The other terminated a year ago.  All have $5,000 to $7500 balances.  I'm told by the actuary that no insurance company will quote on something that small and that completing the form is the only option.  Well if they won't, then what?  We are told their balances may not be transferred to IRA, the PBGC or state unclaimed funds.  The plan sponsor was acquired and the acquiring company has a 401(k) plan, but certainly spousal consent would be needed to transfer the funds.

About all I could tell the sponsor to do was "threaten" in a nice way the two still employed to fill out their forms and go to the home of the terminated participant and be a nuisance.

Comments?

Thank you,

Tom

Does anyone know if there is a floor for the Mandatory Withholding requirement? I know that you don't have to issue a 1099R if the distribution is less than $10. But is there mandatory withholding on the $10? if not, does anyone know what that floor would be?

A covid distribution was processed by the TPA without the trustee’s authorization. Are there penalties/consequences? What should the TPA do?

I did search for the below IRS Section 125 POP Eligibility Safe Harbor link, but have not found the correct one yet. Does anyone have it to share as I did not see it in other blogs or posts for Section 125 Non-Discrimination testing?    NOTE: A safe harbor exists where the POP will be deemed to satisfy all nondiscrimination tests if it "satisfies the safe harbor percentage test for eligibility." For example, a POP that might fail the Key Employee Concentration Test would be deemed to pass all tests if it passed the Eligibility Test. See §1.125-7(f) for more information. 

 I get https://www.irs.gov/irb/2007-39_IRB from September 24, 2007 of which I do not see the Eligibility Safe-Harbor.  Attached is from Zywave without the link, however lists a Eligibility Test from 2014 on pages 1-2. 

Thanks,

Nondiscrimination-Tests-for-Cafeteria-Plans-02-04-14 Zywave.pdf

Would you agree that HCE and Key Employee status do not factor into Form 5500 filing for welfare plans, even 401(k) and other Pension Plans?  Thanks, SAD

I think this is correct, but as a sanity check since it seems harder than expect to find authority on this - if a 401(k) plan is frozen, it's still permissible for participants to take out new loans and hardship withdrawals, correct?

Hi,

In a DB Plan Document (the plan uses a Safe Harbor benefit formula), in the eligibility section, are the following provisions:

"(1)           Eligible Employees. For purposes of Section 2.1(b), all Employees are Eligible Employees except for the following ineligible classes of Employees:

(A) Union Employees; (B) Non-Resident Alien Employees; and (C) Employees not listed on Exhibit A."

For each plan year the Exhibit A is updated to list the employees that are eligible and all employees that are not listed are ineligible . The plan covers,  each year, enough employees to cover 410(b) and 401 (a)(26) each year. A new Exhibit is created for each plan year , and the document contains the yearly Exhibits. Are there any potential issues with this method? Thank you very much for your insights.

Hi

I hope all are well. If a pension  plan in the covered area, is under IRS audit and the IDR response due date falls between Sept 1,21 etc...would the plan now have an extension until.Jan to respond to the agents questions etc.?  Thank you for any help with this.

Recently deceased Age 75 IRA owner named estate as beneficiary, is there a way his wife can roll it to her IRA? The wife is the sole heir in the deceased's will. The death claim has not been paid to the estate yet, just waiting on a few documents.

Thank you.

Ray

I just want to make sure I'm reading all of this correctly.  Under the Hurricane Ida Relief it says:

The IRS also gives affected taxpayers until January 3, 2022 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2018-58, 2018-50 IRB 990 (Dec. 10, 2018), that are due to be performed on or after September 1, 2021, and before January 3, 2022, are postponed through January 3, 2022.

As part of Treas. Reg. § 301.7508A-1(c)(1) it says:

(c) Acts for which a period may be disregarded—(1) Acts performed by taxpayers. Paragraph (b) of this section applies to the following acts performed by affected taxpayers (as defined in paragraph (d)(1) of this section)—

(iii) Making contributions to a qualified retirement plan (within the meaning of section 4974(c)) under section 219(f)(3), 404(a)(6), 404(h)(1)(B), or 404(m)(2); making distributions under section 408(d)(4); recharacterizing contributions under section 408A(d)(6); or making a rollover under section 402(c), 403(a)(4), 403(b)(8), or 408(d)(3);

Paragraph (b) discusses the delayed deadline.  So does this mean contributions due by 9/15 are delayed to January 3? 

Thanks in advance everyone!

In 2020, a participant took a distribution and it was thought that she was 20% vested. However, in 2021 it was discovered that she should have actually been 40% vested. We've contacted the participant and she wants to do a distribution for the portion that incorrectly vested. I've done some research and it looks like the incorrectly forfeited amount must be adjusted for earnings (https://www.irs.gov/retirement-plans/plan-sponsor/fixing-common-plan-mistakes-vesting-errors-in-defined-contribution-plans).

My question is how to determine the earnings on the incorrectly forfeited amount, since the participant's balance was $0 after the distribution was taken?

Thanks!

Where do you indicate a deemed distribution due to loan default on 2020 Form 5500- Schedule H? Would it appear on line 2e(2) or line 2e(1)?