An owner takes out a loan in Oct 2016 with monthly scheduled payments.  He doesn't make a payment by the time we notice in May 2017.  Is there anything that can be done to make it so the loan is not in default?

After all, if he had taken out the loan with quarterly scheduled payments, the first missed payment wouldn't have occurred until Jan, and the loan wouldn't have defaulted until June 30th. 

But there is a catch here.  It is the fiancée's house.  She lives with the fiancée but the mortgage is not in her name.

The distribution at the most broad level is to prevent the eviction.

"(4) Payments necessary to prevent the eviction of the employee from the employee's principal residence or foreclosure on the mortgage on that residence;"

Based on a literal interpretation of the regs it seems to me she would qualify.

We are instructing our new solo k clients that they should file a Form 5500-SF instead of the Form 5500-EZ.  Do the same rules apply for the asset level that requires a filing? In order words, is it correct that even a Form 5500-SF is not required for a solo k until the assets exceed $250,000?

I have a participant wanting a hardship withdrawal to purchase a primary residence.  I have been looking for what is not allowed in the closing cost.  For example can they be reimbursed for the down payment they already made or for the amount going into escrow for property tax and homeowners insurance which would be part of the monthly mortgage payments.  My thought is that these are not "immediate and heavy financial needs"  is there something in writing that I can send other than "immediate and heavy financial needs"

An employee that was eligible for the plan sends the employer a note stating that she wants to start having $20 deducted from her pay for the 401k plan. He never givers her an enrollment form to complete.He sets up the deduction on payroll. The first deduction went into the plan. After that, for some reason, the deductions got stopped on the payroll system.

Now she has terminated her employment and wants to take her money out. Her account balance shows $20. She thinks that she has at least $400 because she thinks the $20 had been coming out of her account each week. There's a $75 processing fee so she can't even get her $20 out.

What can/should be done?

My client has received a letter from her former employer requesting a payment of excess match contribution related to 2007 and 2008 plus interest thereon. The 401K had been rolled over in to her IRA about 4 years ago. Is she required to pay this amount given it was an error by her old employer made many years ago? If she has to make this payment, can it be taken out of her IRA tax free? Thank you for your help. 

My father in law passed away, leaving his IRA to the 4 children. Three of them have taken it and it is in their name. The remaing sibling did not take theirs, it was left in my father in laws name. My question is are the other siblings entitled to dividends that have been earned since the disbursement? thanks 

I ran across a new term today and am puzzled as to what it is. What is a "TEFRA CARD" and how does it apply to plans?

Thanks 

On of my client administers  a small plan and files From 5500-SF.

Therefore, a check mark was put for the last section of Part II - Section 6(b) of the Form 5500-SF that asks whether the plan calims small plan audit waiver.

On the SAR and AFN, there is a similar question about whether the plan claims a small plan audit waiver. 

One of my co-worker is telling me it is not required to list the names and amounts of the publicly traded mutual funds that the plan asset is invested in those regulated financial institution.

Don't I have to list the names of the regulated financial institution , for instance WellsFargo Government Securities, and the amount were the plan asset is invested on the SAR and AFN?

Hi -

I have a cash balance plan that has terminated, and most of the distribution has been completed (95% or so of the plan participants either took their balance or elected to start an annuity). There are, however, some participants remaining who have either not responded or who have actively elected to defer commencement. They are not missing participants.

The facts are as follows:

* the benefits are cash balance based, with some grandfathered annuity benefits payable if more valuable than the accumulated balance. Unfortunately, the prior actuary and their legal counsel amended the plan so that participants may elect to receive their benefits earned before a certain date in a different form than benefits earned after that date, so participants could potentially elect two different annuity forms, or elect to take part of the balance as a lump sum and part as an annuity, etc. - that is rare in practice, though. 

* the remaining balances are about $2 million for the group of non-responders and participants deferring. Grandfathered benefits make the actual total lump sum value slightly higher than that, but not much.

* the interest crediting rate is treasury-based with a floor (the floor applies and has for five years prior to termination, presumably it would apply indefinitely since the regulations don't state that the rate ever goes back to the index base - at least not that I've read)

* the annuity broker has not been able to find someone who is willing to quote for the remaining deferred participants

* Legal counsel has determined that every aspect of the plan is protected and must be provided for in the annuity contract

My questions are this:

1) Has anyone had any luck transferring benefits similar to the above (or any cash balance benefits where all plan options stay intact) to an insurer. If so, can you let me know who the insurer was so that we can direct the broker to them?

2) Can anyone confirm that the 5-year average interest rate applies in perpetuity now? This seems like a given, but just checking.

3) I have heard others claim that legal counsel has allowed them to water down plan options for participants who refuse to respond when it makes the benefits unattractive to an insurer. The client probably doesn't want to do anything like that given the opinion they've already received, but I'm curious if anyone has experienced that in practice.

So I work for an RIA - we are the investment advisor on retirement plans. We have created risk-based models for our clients to invest in (Conservative, Moderate, Aggressive, Etc.)  Every time we present to employees on education or do trustee meetings, we present a sheet showing those models performance the last 1,3,5,10 years.

We have begun changing how those models are constructed, for example like 10% of our models is in US Small Cap Funds, we are moving from a Fidelity Fund to a Vanguard Fund.

For the investment performance presentations we give EE/Trustee, it would be easiest for me to just show the 1,3,5,10 year performance of the updated model allocation, disregarding the old models.  My boss claims that according to ERISA - we need to show how the plan models actually performed, so I need to track when each plan switches their funds within the model, and calculate the actual performance. (Much like how GIPS would require past performance to be presented).

I'm new to retirement plans - this sounds crazy to me - does ERISA require actual historical performance of models to be shown, or can I show the returns of our models once their plan switches?

A client for whom we are the advisor, but not the TPA, claims they were not told that they would be top heavy for 2016. They now say there is no way that they can afford to make the top heavy minimum contribution. We have explained repeatedly that they don't have a choice. In response we are being asked to describe the consequences of not making it. They are apparently willing to accept the risk of being caught because they believe it is unlikely. Beyond disqualification, what are the consequences?

In the past, I satisfied my requirements with McKay Hochman's annual Retirement Insights class (15 hrs CE) supplemented with some recorded webinars from ASC.

ASC webinars mostly repeat and update each year, and McKay Hochman is no longer (2016 was last class).

I need ideas on where to look for CE and especially a source for several hours credit at a reasonable cost (like I got from McKay Hochman).

What are the RMD rules for non-spouse (child) rollover to inherited IRA?  His father died at about age 62, but would turn 70 1/2 in a few years.  Son and daughter are trying to get money out of plan now and this would be a consideration in the rollover.

We have a client that had a defined plan that provided that if a participant could not be located, the benefit would be forfeited, and then reinstated if the participant reappeared.

The client terminated the plan, and made no provision for the participants it couldn't locate.  Now, some previously missing participants have appeared.  The client is perfectly willing to pay them from its own assets. However, clearly the money can't go into the trust, since the trust no longer exists.  And we're trying to figure out whether there is any way to set things up that the money can be rolled over.

In case it matters, it's a governmental plan, so we're not concerned about ERISA rules.  And qualification is not really an issue, for a number of reasons:

• The statute of limitations has passed.
• The plan got a determination letter with the provision disclosed.
• Because the employer is governmental, no deductions are at issue, and the trust would be tax-exempt even if the plan were disqualified.

So the only real issue is the taxation of the participants who just turned up.

With the new opinion/advisory letters being sent out, do public school 403(b) plans have to restate their plan documents onto the new pre-approved plan documents, or can they still rely on the model language in rev. proc. 2007-71?

My employer is switching our group insurance provider mid year, effective June 1st. This is after I've met my deductible and max out pocket, I will only get credit for my deductible with the new insurance plan. I have a medically fragile daughter and she has many medical issues and diagnoses. Open enrollment closed on May 19th, today I received an email requesting that I fill out this questionnaire for each one of my daughter's diagnoses and have it to them by tomorrow. I need to know why they would be asking me for this and is it something I have to provide? It would definitely take me longer than one day to provide the information accurately. This is a group health plan through my employer and I thought denying insurance on preexisting was not allowed anyhow. We live in Texas if that makes a difference.

addition health questionnaire (1).pdf

Plan terminated and all assets distributed in December, 2016.  I have not filed a 2016 5500SF yet, because in March of 2017, a  distribution check was returned and deposited into the Plan's investment account.  My question is how do I handle the 2016 return?  Do I file a final filing for 2016 and then amend the 2016 return without marking "Final Return" or do I file the 2016 return originally with zero assets, but not marked "Final"?

For 2015 calendar year Plan, my client chose to put the max. away for the HCEs between deferrals, SH Match (enhanced formula) and discretionary PS contribution.  They do not pay their ER contributions until September of the following year (9/2016).  

Also, in anticipation of terminating the Plan on 6/15/2016, they amended the plan to eliminate the SH Match effective 1/1/2016 and all appropriate amendments and notices were given to participants in November, 2015.  Ultimately, all assets were distributed prior to 12/31/2016.

When it came time for them to make the 2015 ER contribution in September, 2016, they didn't have enough money to contribute for themselves, so they just funded the SH Match and PS discretionary contributions for the NHCEs ONLY, and not themselves (I advised against this, so it was their decision, not mine!)  The 2015 5500SF and Corp. tax return were both filed using the reduced deduction for contributions made to the NHCEs only.

How do I solve this?  They now have contacted an attorney to "tie up loose ends" for the company, and it seems they are looking to somehow pin me to the wall for it!

Thanks for any help!!!