I am elevating a new 401(k) that’s offering hardship withdrawals. The prior recordkeeper never maintained a hardship bucket on their system because the plan was previously a 401(a) that did not permit hardship withdrawals

Questions: Now that I am elevating hardship withdrawals for the new 401(k) plan do I need to ask the prior recordkeeper for inception year to date contribution amounts so that I can load to the hardship bucket. Or does the hardship bucket starts from now, since I am adding hardship withdrawals to the plan effective 01/01/2015?

We have a plan that used elapsed time for vesting, however effective 1/1/2015 the plan was amended to change vesting to counting hours. The vesting schedule was also amended from a 6 year graded to 25% a year effective 1/1/2015.

If we have a participant that was hired 6/13/2011 for example (this is a calendar yr. plan) what would there vesting be as of 1/1/2015.

Based on elapsed time the vesting prior to 1/1/2015 was:

6/13/2011-6/13/2012 - 1 year

6/13/2012-6/13/2013- 2 years

6/13/2013-6/13/2014 - 3 years

Prior to the amendment this person would be 40% vested.

Does this person become 75% vested on 1/1/2015 (based on 3 years) OR is this person now 100% vested since it's counting hours. In other words since we changed it to hours do we now look at the fact that this person would have 4 years of service as of 1/1/2015 (2011,2012,2013,2014 - lets assume this person is full time and would have completed 1,000 hours in all years).

For the specific case of a spouse who is the sole beneficiary,

if the participant died prior to the participant's RBD,

for beneficiary distributions from a qualified plan,

does the spouse beneficiary have the option to use the longer of the life expectancies of the beneficiary and participant?

These articles seem to say the spouse beneficiary has that option:

http://www.mhco.com/BreakingNews/ABene_Spouse_041014.html

http://www.mhco.com/BreakingNews/A_SpouseBenef_011008.html

but I have generally read that that option is available when the participant dies on or after (not prior to) the RBD. But maybe the spouse who is the sole beneficiary gets this option no matter when the participant died.

And is this different for IRA's and qualified plans?

Thanks for any clarification.

Physician client has investments in a surgery center, C-Class Shares. Client does use the surgery center to conduct surgery for his patients, as do other physicians.

Is this a prohibited transaction issue?

Does it matter that the retirement plan owns non-voting C-Class Shares?

First - a disclosure - I don't know nuthin 'bout 403(b) plans.

Our firm provides custodial and record keeping services for a 403(b) plan.

This plan is leaving us to go to a new vendor. There are 4 individuals in the plan who have separated service and the TPA is stating the new vendor will not accept the funds for these individuals as they won't have "applications" for them.

It is my understanding that a 403(b) cannot do a force out (as in 401(k)-land) - and keeping the funds of these four individuals here would keep the contract we have with the plan sponsor in force - and that's not what they want. I see nothing in our contract that allows us to force the sponsor to take all the accounts to a new vendor.

Suggestions please - what can be done with the account balances of these 4 terminated participants?

Suppose you have a DB plan that institutes a hard freeze - no further accruals after, say, 1/1/2015.

Does this negate required late retirement "adjustments" to the benefit accrued on 1/1/2015? In other words, your Normal Retirement Benefit as of 1/1/2015 (frozen) is $1,000 per month, beginning at age 65. No further accruals. But there is (or was) an actuarial adjustment of (pick a number, I have no idea - say 0.5% per month) for every month you continue to work past NRD.

Does the hard freeze also negate that adjustment, or is the adjustment still required, even though there are no additional "accruals" for anyone?

Thanks!

Has anyone taken a look at the changes to the annual funding notice under MPRA? For a calendar year plan, are those changes applicable to this year's notice? The notice looks at the funded status of the plan for the 2014 plan year, but the effective date for the changes to the notice is "the date of the enactment of this Act." The MPRA was "enacted" in 2014, so are the changes effective now? Other sections of the MPRA are effective for the 2014 plan year. Will the DOL be publishing a new model notice?

For the notice of critical status, it did not look like there were any changes to this section of ERISA, even though some different terminology is now being utlilized (i.e., critical and declining status). Am i missing something here? Were there any changes in the critical status notice requirements I missed?

I was reviewing a benefit calculation for an individual and I had two questions:

1)the plan is a integrated excess plan. for covered comp the calculation showed the

covered comp for someone turning 62 in 2014..every covered comp excess formula I have seen used participant specific covered comp based on year of birth. 401(l) reg is quite difficult to read regarding single integration $ amounts so I am wondering if that is ok or someone doing the calc picked up the wrong amount.

2)the lump sum amount payable as of 2/1/15 uses the 2014 applicable table. I reviewed the IRS guide and it seems that you must use the mortality table relevant to the applicable stability period(i.e., 2015 table in this instance)

this is an attempt to produce a count for the 5500 SF for the active count at beginning of year and end of year

nothing fancy or pretty - the counters should be pretty obvious

5500 count.rpt

We recently merged with another business and our 401k plan was transferred to a new broker. Without my knowledge, my monies which were self directed to a specific fund in the old plan were mapped to a dissimilar fund when the blackout period ended. Apparently the old fund was removed from the plan on the advice of the new broker and with the approval of the new business investment committee. The new fund has underperformed my old fund by 25% since the blackout period started a month ago. The company claims I should have received written notice by mail. Do I have a legal claim?

deleted.

Withdrawn.

A Safe Harbor 401(k) plan currently has a 3 month eligibility with entry dates of October 1 and April 1 (off calendar plan). The employer would like to amend the entry date to monthly. Would this be acceptable using the rationale of the IRS at the 2012 ASPPA Conference? Or is that rationale only applicable if you have a classifcation of employee that was not previously covered?

Plan provides for a 3% non-safe harbor match. Participant must be employed on the last day of the quarter to be eligible for the allocation. Also, plan provides for a quarterly true-up. The question is how should the true-up be calculated with this design? Should the true-up only be calculated for the quarter in which a deferral is made or should the compensation for quarters where no match is contributed also be considered for a true-up? The individually designed document is silent.

Example: First quarter Joe has compensation of $40,000 and contributes $17,500. Match contribution is $1,200. Second quarter Joe has compensation of $40,000 and no deferral/match. Should a true-up be calculated on $80,000? What if he terminates during second quarter therefore making him ineligible for the match since he was not employed on the last day of the quarter? Is that a game changer?

Any insight would be greatly appreciated!

I would appreciate help on this issue...including law/regulatory citations as appropriate. Some of our staff came from a meeting with a consulting group with a concept they indicated the consultant posited as able to be done. I suspect our staff did not correctly understand the concept and/or details if the consultant but this is what the staff indicated.

A DC plan with a 401(k) component (ours is a pension plan under ERISA 3(2), a DC plan under 3(34) of ERISA, a plan meant to be compliant with 404©, a profit-sharing plan with a 401(k) component) could be amended such that from the effective date of the amendment forward, the company match could be done in a notional manner (that is, not actually making the company match contribution to the participant accounts) and then funding of the company match would only occur (I assume funding with gains/losses of the notional amounts associated with the company match) until a distribution was taken. I gather the theory here is that this is a way to preserve cash (and defer cash contributions) of the plan sponsor.

I quickly searched for guidance/articles concerning when employer matching contributions should be made but other than following the plan document could not find other guidance (although it is probably out there).Of course, there is guidance about timeliness of putting elective deferrals in the participant accounts.

Presently our plan indicates the company match goes into the participant account as soon as administratively practicable following the eligible pay period.

I doubt our plan sponsor would embrace this concept even if it legal. However, I had never heard of such a concept and just wondered if the BenefitsLink retirement community had heard of such or had thoughts about whether such was legal.

Again, this is mostly for my education and to "educate" our staff.

Thanks.

This summer, we expect decisions from the Supreme Court of the United States on whether a State must provide same-sex marriage (if the State provides opposite-sex marriage) and whether a State must recognize a same-sex marriage that was made under another State's law.

These decisions matter greatly to someone who now must travel to be sure of making a same-sex marriage, and to someone who faces uncertainties about whether a court of a State in which he or she is domiciled or resides would recognize his or her marriage made under another State's law.

But for employee-benefits practitioners, I wonder if the news already happened. After the 2013 decision and administrative-law guidance, an administrator of an employee-benefit plan that has any provision that turns on the presence or absence of a spouse, has to be ready to apply the provision knowing that a same-sex marriage is at least possible. That's so even if the plan's sponsor and participants are so geographically limited that everyone resides in a State that neither provides nor recognizes same-sex marriage; an ERISA-governed plan usually recognizes a marriage that was valid under the law of the State in which it was made. (We recognize that church plans and governmental plans have quite different paths.)

Are there follow-on effects of 2015's same-sex marriage decisions that employee-benefits practitioners would need to do something about?

Have a husband and wife only 401(k) plan that allows for Rollovers, Roth deferrals, after-tax contributions and Roth conversions.

The wife has $100K in a traditional IRA. $50k is pre-tax and $50k is after-tax.

Can she roll over $100k from the IRA to the 401(k) plan and then convert just the $50k of the after-tax account to Roth?

Thanks.

We are in the midst of a standard termination. We want to offer a lump sum window to terminated vested participants. Can we offer this same lump sum window to active participants? Is that legally permissible? The more people that take lump sums, the more accurate our annuity pricing will be. Thus, we wanted to see about offering the lump sum window to actives.

Thanks for any thoughts.

I have a two person 401(k) in 2014. One is an HCE, the other NHCE. The Plan has used prior year testing for over 10 years.

In 2013, NHCE deferred 5% of $40,000 gross W-2 (Box 5) which is $2,000. Calculating the ADR using net comp (Box 1) would yield (2k/(40k-2k))= 5.26% ADP. The FT William doc is silent on how to calculate the ADR.

I'd like to calculate the deferral limit for the HCE to be 7.26% of gross (Box 5) compensation.

Any thoughts?

Plan A is a traditional DB plan with a Final Average Earnings (FAE) formula. It defines FAE as the average compensation for the 60 months of Employee's last 120 months before retirement that produce the highest average. Plan A counts post-severance payouts of accumulated vacation pay in FAE. Typically, it's paid in the month after the Employee terminates. E.g., if Employee terminates on 1/15/15, the vacation payout will be made around 2/15/15.

Is there a legal impediment to counting that February payout as part of January's comp (the last month for which Employee received a regular paycheck)? This would be more favorable to Employee's FAE because it would spike January's comp, rather than marooning it in February. I can't find any authority one way or the other.

Thanks for any replies.