Based on the regulations that came out this morning, it looks like a fixed interest crediting rate of 6% is allowed under the regulations for a hybrid plan.

What I would like to know is when this is effective. The regulations are generally effective January 1, 2016, but it also states

"The rules in these final regulations that merely clarify provisions that were included in the 2010 final regulations apply to plan years that begin on or after January 1, 2011, in accordance with the general effective/applicability date of the 2010 final regulations). In addition, these regulations amend §1.411(b)(5)-1 to provide that §1.411(b)(5)-1(d)(1)(iii), (d)(1)(vi) and (d)(6)(i) (which provide that the regulations set forth the list of interest crediting rates and combinations of interest crediting rates that satisfy the market rate of return requirement under section 411(b)(5)) apply to plan years that begin on or after January 1, 2016. footnote 9"

footnote 9 says:

"The 2010 final regulations provide that these particular provisions apply to plan years that begin on or after January 1, 2012. The intention to delay the effective/applicability date of these provisions was announced in Notice 2011-85 and Notice 2012-61. Notice 2012-61 announced that these provisions would not be effective for plan years beginning before January 1, 2014.

So, can the use of a 6% fixed rate be relied upon in 2014 or 2015?

Client has a safe harbor 3% plan- Company A. They have a second company ( not a controlled group) that has a 401(k) Plan - not safe harbor.- Company B

Recently they started to have employees transfer between companies. They want to give employees in Company B who transfer to Company A service credit for purposes of eligibility.

Since this would take an amendment, are they prohibited from adopting a mid year amendment for this change effective in 2014?

They are expanding coverage to allow additional employees to participate in the plan. Would the IRS take issue with this mid year amendment?

Thanks

The Aug rate was released yesterday

so we have 238.250 for July

237.852 for Aug

awaiting Sept

unless it dramatically, and that would be a super dramatic drop to go under 233.000

then the limits next year will be

6000 catch up

18,000 deferral

265,000 comp

53,000 415 limit

120,000 HCE limit

or I guess our wonderful govt could hop in and say Sorry, no more increases.

I have a plan that is facing a major coverage problem unless it merges all of the plans in its controlled group by the end of this year. They are skeptical, and want to see a "for instance" on how much it would cost them in the event that they had to go to a closing agreement.

My question is, is there a way to access the IRS decisions on closing agreements reached with plans? I know I've seen a couple of very large ones reported somewhere, but I can't recall where. Is there a way to access these decisions on a website?

Client has an Employer Sponsored Individual Retirement Account plan - adopted in 1978. The employer withholds the participants' IRA contributions (all are after tax) and the participant's match is also taxed, and makes the deposit to an omnibus IRA trust. Now it's up to each participant to claim the deduction (annually) to convert this contribution to a pretax benefit.

What happens, however, when a participant doesn't claim the deduction? Maybe due to the fact that the participant couldn't take the IRA deduction for that year and/or subsequent years?

The plan now terminates and the trust holds after-tax IRA money? Where can it be rolled? Is it treated like a ROTH? The Plan doesn't allow ROTH.

Any ideas?

This comes up all the time. We get a court signed document saying to move money from the Participant to the AP and they come back and say "we won't comply with the order without getting the paperwork back from the participant."

To which I say "are you crazy??" We learned the hard way with a large QDRO where we waited until the participant returned paperwork (per the general procedures of the recordkeeper), which of course she never did. Imagine the hot water we were in when we told her account was down 17%... (this was back in 2007 or 2008).

Am I the only who constantly bickering with recordkeepers to get them to move the money to a new account ASAP.

Our local monolithic BCBS bureaucracy offers participants in its clients' self-insured health plans the ability to receive rewards for participating in certain participatory "wellness" activities in the form of cash reimbursements. For instance, if a participant joins a gym and documents that it completed X number of workouts, BCBS will reimburse a portion of the gym membership fee.

This reimbursement is a taxable fringe benefit under the Code. As such, each employee must include it in gross income and the employer must properly withhold the amounts and report the amount on the employee's Form W-2

BCBS appears to be, thus far, unwilling and/or unable to provide its clients with information about these reimbursements to permit the clients to comply with its reporting obligation.

There does not seem to be a legal obligation on BCBS to provide the information.

I understand the risk of liability is relatively low here but has anyone come across this situation and, if so, how did you address it?

Thanks!

Per HATFA guidance, section IV.A. an employer may reverse an election to reduce funding balance for the 2013 plan year under 1.430(f)-1(e) if the election was made by 9/30/14. It seems that 1(e) refers only to waiver of funding balances and not election to apply funding balances towards meeting the 2013 minimum funding requirement.

At least one summary published has indicated that this reversal would be available for elections to apply funding balances toward the funding requirement as well as waivers despite how the guidance reads.

Has anyone come across this issue yet? And if so, what was your interpretation and result? Thanks.

A plan has annual automatic enrollment set up that applies to all employees except 2 groups, which are named in an amendment. Does the ACA notice need to them as well, and state that it doesn't apply to these groups, or can it just be distributed to the employee groups that it's applicable to?

• SH Plan with calendar year plan year was acquired in M&A transaction. Parent plan is fiscal year plan year and not SH.
• Need to create short plan year in SH Plan to align plan year with parent's plan year once 410(b) transition period ends.
• New fiscal year plan year will not be eligible for SH testing b/c of plan aggregation.

Question: Does creating short plan year trigger ADP/ACP testing for short plan year? Note that the following plan year cannot be a 'safe harbor plan' because it is now part of controlled group and aggregated for testing.

Many thanks, brilliant minds.

New plan is effective 1/1/2014 with a special elective date of 10/1/2014 for deferral and safe harbor provision (3% non-elective.) Definition of compensation includes compensation which NOT a participant. What compensation is used to determine the 3% safe harbor contribution? Is it the compensation as of the effective date of the safe harbor provisions or full year?

Take that question one step further, an employee is eligible for this plan 1/1/2014 (met service and age requirements prior to the start of the plan), but this employee terminated employment 6/1/2014 (prior to the effective date of the safe harbor provisions.) Is the client required to give this terminated participant a safe harbor contribution?

This doesn't pass any smell test but I can't find the legal prohibition:

Large group health plan has terrible claims history based on 1 particular employee

Insurer telling employer "If we don't have to cover the sick employee your group renewal rate increase is only X% but if the sick employee coverage continues the group rate increases by 3X%"

Employer obviously wants to exclude the sick employee from coverage (and raise his wages by enough to cover his premiums for Marketplace coverage where his pre-existing conditions don't matter).

This has to violate somethng?

so what did the pirate say when he hit his 80th birthday?

Aye, matey!

..................

your correct response of course is

Arrrrrrhhhhhhh.

oh wait, this is supposed to be the humor board

We have a plan that doesn't forfeit until you have been fully paid or have 5 BIS. It has no deemed distribution language.

There are a group of people who have a DOT are 0% vested and have an ending balance.

Are these people in the beg count?

It is the difference between needing an audit and not needing an audit.

When plan was drafted a couple of key people got excluded from the match because they had not yet met eligibility for the match (but they did defer).

Does anyone have a problem with the company providing a "bonus" equal to what the match would have been, which the employee can then contribute the plan as 401k (they are well under the 17,500 cap)? I seem to recall that there is some rule that prohibits anything be provided on account of elective deferrals other than "match."

It seems to me that an employer should be free to provide a bonus for any reason imaginable.

Thoughts?

We am looking at a Relius Adoption Agreement. There was an age waiver if you are employed on 9/30/2014.

I am looking for some clarification. The client has a 17 year old employee who have not yet satisfied the service requirement of 1 year of service but was employed on 9/30/14. He will have 1 year of service as of 12/31/2014. Does he enter the plan on 1/1/2015? In order words, does the age waiver stay with the employee until he has met the service requirement.

Thanks.

Employer maintains both an ESOP and 401(k) plan. Employer wants to merge the ESOP into the 401(k) plan. The 401(k) plan is a prototype. It is my understanding the certain ESOP provisions must be preserved in the merger, such as the right to receive employer stock in kind, the right to diversify, and perhaps put rights. The employer's stock is publicly traded and the 401(k) plan in operation permits distributions in the form of employer stock and the right to diversify frequently.

Does the 401(k) plan has to be amended to preserve such rights and does this fact turn the 401(k) profotype into an indivdually designed plan.

Small business was convinced by an advisor to start a new plan and the best way to do that would be to terminate the old plan rather than transfer assets. So they are both 401(k) and there is a successor rule issue that has been violated. Trying to come up with solution to fix. Can resolution to terminate first plan be revoked and 5500's amended?

An IRA holder over age 70 1/2 has taken her RMD from the IRA as required.

She subsequently becomes a participant in a 401(k) plan. She is not highly-compensated nor an owner of the plan sponsor, but rather a rank-in-file employee.

If she rolls her IRA into the 401(k) plan can she stop taking an RMD on the IRA balance rolled into the 401(k) until she actually retires?

If a small 403(b) terminates and liquidates by 12/31/14, is PPA restatement required?

Thanks