This hasn;t happened, thank goodness, but the question being posed by a board member is, if a participant were to embezzle money, or was terminated for some other crime against the employer, is there a way to forfeit their balance?

My assumption is that nothing the participant can do will eliminate the liability to the participant.  Yes, I am aware of the fact that this is doable in a 457f plan which is still subject to a substantial risk of forfeiture.  I assume there is no possibility of this in a 457b.

Let me know what you think!

Husband and wife jointly own Company A.  Company A's employees are being moved to a PEO, and will be participating the PEO plan.  I'm assuming the existing Company A plan is being merged into the PEO plan.

Husband and wife jointly also jointly own Company B.  They will be receiving compensation from Company B.

Does anyone have any experience that they could share with the testing involved if Company B sponsors a plan that would cover just the husband and wife? 

I understand the combined testing that would be involved if Company A had its own plan and B had its own plan, but I'm not sure how it works when Company A is part of a PEO plan.

Does the PEO use the Company B contributions in its testing of Company A?  Seems more likely that the PEO wouldn't even ask about any controlled group members.

Thanks.

Hello,

Any advice for the following situation?

Our entity is a pension distribution group, we had a member with an IRS levy that we just recently learned had passed away (late reported death).  Long story short - we paid the IRS for 8 months of levy payments that shouldn't have happened!  About 10k was overpaid.

Any shot of getting this back from the IRS? 

Crying in my great Carlsburg Octoberfest Beer.....thanks Brian!

Good afternoon to all:

From a colleague in my office:

"Requesting advice regarding completion of Schedules A and C for large plans using a John Hancock style (insurance) product. We believe that Commissions to Insurance Agents and TPA Fees deducted from plan assets (Distribution and loan fees) are reported on Schedule A. Revenue Sharing (Forum Compensation) could be reported on the A or C and if reported on the A then it would be left off the C. Any thoughts on this? "

Thank you as always for any advice.

I owe child support arrears due to an oversight (by both parties) not discovered for years. My Ex has been incredibly aggressive in her attempt to collect the entire amount in a lump sum. I asked for relief from the court and I have an order stating the the arrears shall be paid off at a specific monthly rate. I have been paying that amount on time every month for a few years.

I recently discovered my Ex filed an ex parte application for a child support arrears QDRO and she is trying to get the money from my 401k. Apparently QDROs are hard and her first attempt was rejected (common occurrence it seems), well the legal team used by my employer was nice enough to provide her a template she could use to met the required format. I don't think the QDRO has been signed by the judge yet, but I expect it will be soon. 

Is anyone familiar with a process I could use to prevent the QDRO from being executed? I'm thinking something like a motion to recall the QDRO or maybe a restraining order to prevent it from going through.

Reasons I don't think the QDRO should be acted on: 1) A payment arrangement has already been ordered by the court and I have adhered to that order, 2) By the time the QDRO is approved and executed the amount I actually owe will be several thousand dollars less than what is requested by the QDRO, 3) The taxes and fees I will incur are unreasonable given I have been paying according the court order on time every month.

We are using Relius software.

Please help me how to pull from Relius (or direct me where/how to find it)the APR at age 65 if the actuarial assumptions are: Pre-retirement 7% interest; Post-retirement 5% interest, and the 1994 Group Annuity Mortality without setback.

Should an investment committee have a special process for adding a target-date fund to a 401k lineup, and possibly using it as the QDIA? A client is being told that it should take the extra step of having its investment committee interview the managers of the target-date funds under consideration. I haven't heard this before. Any thoughts appreciated. Thanks. 

The company is being sold with lots of UNallocated shares in the ESOP.  What happens to them?  Are they divided up among the participants?  Or does the new owners decide?  

Plan has up to ~12% profit sharing (after integrating w/ SS) plus a 6% matching contribution.  As a result, after taking into account 401(k) contributions, a handful of participants each year will require a portion of their 401k refunded.

4.04 of EPCRS states:

 A plan that provides for elective deferrals and nonelective employer contributions that are not matching contributions is not treated as failing to have established practices and procedures to prevent the occurrence of a §  415(c) violation in the case of a plan under which excess annual additions under §  415(c) are regularly corrected by return of elective deferrals to the affected employee within 9½ months after the end of the plan's limitation year. 

So I'm ok with this policy, correct?

Proposed regs released for Hardship Withdrawal changes made by TCJA and BBA2018.

Also includes relaxed rules for those affected by Hurricanes Florence and Michael.

https://benefitslink.com/newsletters/2018/2018_11_09_retirement_bulletin.html

We are the TPA firm for an ERISA 403b that has assets with a well known recordkeeper' plan sponsor has an unbundled service agreement with the recordkeeper.

We have a terminated participant who will be due an RMD by 12/31/18 and are being told that only the participant can request the RMD.  Not the TPA, not the plan sponsor.  But, if the RMD is missed, it is the plan sponsor who is responsible and liable for the missed RMD, correct?  If the RMD is missed because the participant either intentionally or unintentionally does not request the RMD, but the plan sponsor requests I, is the plan sponsor still liable?

Is the answer different because this is a 403b plan?

Thanks

A participant with a TEFRA 242(b) deferral election has died with a substantial deferred MRD balance.  He is currently in the middle of a fixed 30 year installment schedule.  (Died after RBD.)  If Spouse beneficiary revokes the installment schedule, this will revoke the 242(b) election.

Question is:  Is Spouse then required to take the make-up MRD distributions of the participant within 2 taxable years, or do the make-up MRD distributions ONLY apply to the MRDs that the BENEFICIARY has deferred AFTER the participant's death?

ERISA Outline Book indicates only the post-death MRDs would have to be made up, but I have not found a supporting reference for this.

Thanks!

Has anyone ever had a plan sponsor do this?  Our standard document doesn't have this option but has a write in section where we could add language.  I've never seen it before but I don't see it being an issue compliance wise.  The plan sponsor can't figure out how to get their payroll system to do both so this was their solution.

Would welcome thoughts on this:  Large 401(k) Plan with significant assets and forfeitures throughout the year has elected to use forfeitures to reduce employer matching contributions and expenses.  Although significant, all the forfeitures can generally be exhausted by covering employer matching contributions except for late in the year forfeitures that administratively aren't fully captured until early in the following year.  Plan uses Relius volume submitter form which provides that all forfeitures should be allocated no later than the end of the plan year following the year in which forfeitures occur.

I'm looking at the ERISA Outline Book and it's references to the Spring 2010 edition of the IRS's Retirement News for Employers.  In that, the IRS says the following:

1.  No forfeitures in a suspense account should remain unallocated beyond the end of the plan year in which they occurred.

2.  No forfeitures should be carried into a subsequent plan year.

3.  For those plans that use forfeitures to reduce plan expenses or employer contributions, there should be plan language and administrative procedures to ensure that current year forfeitures will be used up promptly in the year in which they occurred or in appropriate situations no later than the immediately succeeding plan year.  

So, I generally interpret that to mean you need to use up the forfeitures quickly and apply them to the extent you can by the end of the plan year in which they occur; however, if the plan docs say it is ok, it is generally permissible for some amount of forfeitures to spill over to the next plan year where not administratively feasible to allocate and use to offset matches 100% by end of the plan year in which they occurred (e.g., forfeitures happening in November or December).

Does that seem generally acceptable / correct?

Plan sponsor is asking if it can break with prior tradition and not use any of the 2018 forfeitures to cover matches and expenses in November and December and instead carry full amount (so 11 months of forfeitures) over to 2019 then use in Q1 or Q2 in 2019.  I think some plans do that routinely and not sure the IRS would have huge issue but it seems counter to the general guidance here.  Am I off base?  (Assume that the lagging forfeitures from late 2017 carried over into 2018 were applied to expenses so have been used.)

Thanks

What is everyone using for the PPA restatement effective date? Are you going back to the original effective date because there was no IRS reliance on the prior document?

Any comments are appreciated.

Hi, 

I’m taking a lump sum pension payment, and plan on rolling it to a new IRA account. I already have a different Roth IRA account. Can I still put the max ($6500) into my existing Roth IRA this year, or does the lump sum pension payment max me out for 2018?

Thank you.

The client is the plan administrator for a multiple employer plan, and they currently do not have a good system for administrating forfeitures and crediting the plan adopters on their payroll invoices.

They asked if we could facilitate the forfeiture process and issue a check for the use of the forfeiture balance each quarter directly  back to the adopter in lieu of taking the forfeiture credit  at the time of the contribution with the ER contribution.

Of course the amount to be refunded would be limited to their ER contribution, (but not to exceed the available forfeiture balance).

Will administrating forfeitures in this manner violate the rules of forfeitures being reverted back to employers?

Thanks for any input you have on this.

Client currently has 401(k) with 3% SHNE.

No ER profit sharing.

they want to add a provision for voluntary contributions.

this this allowed and would any testing be involved, and what type?

I have a few questions for those who may use the Ft. William Volume Submitter Profit Sharing Plan With CODA, specifically the one that does not involve a prototype, lead document and adoption agreement.  If you do, please contact me offline at johnsimmonslaw@gmail.com.  Thank you

Someone mentioned to me that a DB Plan that they administered was taken over by a new firm. The new firm is asking the prior administrator/actuary to back up (ie show the calculations for each participant) the accrued benefits for all  participants that are in the most current valuation (7 participants).  Is this something hat is required of the prior Actuary ? Thank you.