I reach age 70 1/2 this year. I have four Individual Retirement Accounts, two of which contain Individual Retirement Annuities and nothing else. The annuities have not been annuitized. I don’t plan to annuitize them for a couple of decades. Can I add up the Required Minimum Distribution (RMD) from these and take the total from one of the Individual Retirement Accounts not containing an annuity and by doing so satisfy my RMD for all of the accounts and annuities? Does the fact that the annuities are in Individual Retirement Accounts make a difference?

We ran into an interesting situation. We have 401(k) where owners already took out loans, have fully vested Profit Sharing money and plan allows for in-service after age 50. Both owners (h/w) have taken distributions from their PS such that now both account balances are well below the loan amounts. Husband is still employed but over 50, and so is taking in-service. Wife terminated a few years ago but wants to leave what is left of her money in the plan.

Since the 50% limitation for loans is designed to provide a remaining account balance sufficient to secure the loan, what about this situation. We are aware of no restrictions that keep the participants from withdrawing after they have taken their loans. In fact, since the loan balances are now more than the remaining invested balances, the wife would actually end up owing money were she to take a total distribution.

Thoughts and experience on this issue?

Just got an email from benefitlinks and noticed it said something about VCP Submission documents. When I clicked on the link it took me to the IRS website and i see they have new VCP forms.

Form 14568 is the Appendix C Part I - Model VCP Submission Compliance Statement.

I just received a signed submission back from the client and I am about to put in the mail when i saw this. The forms i used which i probably downloaded from the IRS website about a month ago did not have a form number.

Does anyone know if it's ok to continue to submit using the old forms or do we have start using these new ones right away??

When filing the SF instead of the EZ, are there questions that we do not need to answer because those same questions are not on the EZ? I'm getting the message from someone that the SF they filed has a lot of blanks because those questions do not apply to an EZ.

I read a post recently that I think is misstated (unintentionally). Here are the facts that I would LOVE to get comments on.

Individual business owner is wanting to make a charitable gift of his 401(k) assets to charity. However, he wants to take some of the funds from the plan and "distribute" and purchase a life insurance policy with the beneficiary (most likely) being family. It is possible that they could make the charity the beneficiary as well.

What I thought I read elsewhere (but don't believe this is possible) is that once the funds are distributed from the plan, they are taxable, regardless of an ILIT, correct? Whether the end beneficiary is the charity of the family, correct?

If that answer is YES, my question is why would an ILIT be necessary as the funds would have been taxed and, therefore, the purchase of life insurance with such funds would be not taxable to the beneficiaries. Am I missing something?

Thanks.

Sam

A lump sum restriction went into effect because an AFTAP wasn't certified timely. Once it is certified above 80%, are lump sums allowed immediately, or is there a wait time?

Can the start of auto enrollment be pushed out or does it have to start within a certain period from meeting eligibility in the plan?

Suppose a company currently has a Safe Harbor plan with one year eligibility and a QACA/auto enrollment feature in place. If the company wanted to offer immediate eligibility but did not want the auto enrollment feature to kick in until the second year of employment/eligibility, would that be allowable?

This might create more of burden with explaining it in the annual notice, but otherwise I'm not able to find a specific citation that would prevent such a delay in starting the auto enrollment. In describing the minimum initial percentage, the regulations (I'm looking at 1.401(k)-3(j)) do not seem to tie the initial period to eligibility or any specific date.

Does anyone see a problem with delaying auto enrollment like this?

Thanks!

We have a client who established a ROBS. Plan owns the company's stock. Client would like to terminate the plan but does not want to sell the stock as the client still wants to own the business. How can this be accomplished? Has anyone encountered this problem before?

A client is on the board of a publically traded company and receives stock options. He wants to take his owner only defined contribution plan assets and invest them in those stock options. Is he allows to have those stock options in his own DC plan? If so, are there any restrictions? Does this require a full plan audit or increase fidelity bond? Any help would be appreciated.

My client (plan sponsor of a self funded) group health plan is being asked to consider adding coverage for both therapies and ABA for covered individuals with autism spectrum disorders but not any other developmentally impairing condition (eg. Fragile X). Currently such treatments are excluded under the plan by the general educational, custodial and developmental coverage exclusion, or in the case of ABA under medical necessity/investigational guidelines. (The plan is not required to cover under ACA or any state law because it is self funded.) We are struggling with the potential for an autism only benefit to result in claims under the ADA by employees whose children have a need for such treatment but who have a condition that is not on the autism spectrum under the "subterfuge" exception to the bona fide plan rule. There seems to be little guidance on the subject and no recent case law. Any thoughts?

An auditor recently informed me that the fees paid when a participant takes a distribution/rollover should be reported on the Schedule H as a benefit payment and not as a fee. So if the distribution fee is $100 and the participant rollovers $10,000, line 2(e)(1) would have $10,100. Any thoughts on this?

Can an employer for a SH Non-Elective plan make it per pay period without a true-up?

I'd appreciate help here.

I have a 100% vested qualified plan with a proposed revocation of tax exempt status.

The reason for the revocation is that even though the plan terminated and received a 2008 termination letter from the IRS, full distribution was not made soon enough. The IRS deemed the plan to be "ongoing" rather than terminated, and now wants revocation based on failure to update.

No contributions were made since 2008.

If tax exempt status is revoked as of 2010, are the employees taxed on 100% of the plan value or just the contributions made after the date (none)? The client was highly compensated but the plan was in full compliance when terminated in 2008.

I have seen articles with both answers.

THANKS!

Jeff

We have a client who changed their trustee and TPA in 2013. During a 5 week period while the conversion took place, the employer issued a blackout notice. During this period, no employee deferrals where deposited. The deferrals were April 2013 deferrals and were deposited by May 15, 2013. On average, April deferrals where deposited within 21 days. For all other payrolls, the client deposited deferrals within 1 to 2 business days.

Do we have a problem here? I haven't started my research and am not sure if a blackout notice covers deferral deposits. The employer was told to not make any deposits until the new TPA & Trustee had the client's records in order. Looking back, the client regrets not opening a temporary account in the name of the Plan.

Thank you for your help.

How do I characterize an IRA that has escheated to the state? Is it a disribution reported on a 1099? Is it simply a transfer of some sort? Any help would be greatly appreciated!

Surfing the EFAST2 website came across a 5500 Schedule I (Small Plan) reporting:

3a $900,000 of Parnership/Joint Venture interests

4e $500,000 Fidelity Bond

4k Claiming qualification for audit waiver

Since the bond is less than the non-traditional assets doesn't this plan have to have an IQPA audit?

In Alb., NM and need an experienced 401(k) administrator but no response to local ads. Where online would be the best place to post a position? Don P

Thanks very much to Effen for pointing out a problem with the message boards search engine, which now has been fixed.

The search engine was ignoring 3-letter words, such as "HCE". It was paying attention to words of 4 or more letters, but the 3-letter words got the cold shoulder.

Words of only 1 or 2 letters continue to be disregarded, though, because they would cause the search engine to bog down.

Another technique is to use Google. You can focus all of Google's processing firepower onto the message boards by including the phrase "site:benefitslink.com/boards" (but without the quotation marks) as part of the query you enter at google.com (or in your browser's Google search bar, etc.). For example, to see topics that contain messages about the HCE compensation limit, type this into the box at http://google.com:

HCE compensation limit site:benefitslink.com/boards

(Note how no blank space appears between site: and benefitslink.com, and no blank space appears between benefitslink.com and /boards.)

You might want to bookmark this page:

www.google.com/?q=site:benefitslink.com/boards

which will pre-fill the box with the magic site string. You'd then add your desired word or words into the box before clicking the Google Search button.

I think I know the answer but want to be sure.

If an IDA participant in a small plan has an LLC investment, does this mean that 100% of the assets are not in qualifying assets and long form must be filed. The LLC is held in custody by the IDA custodian (an RFI) but the LLC does not have a readily determinable market value. I was hoping maybe there was an exception for participant directed IDA investments that would allow us to continue to be eligible to file an SF.

Thanks

ok this may be retirement plans 101 but for some reason we can't seem to figure out the answer.

Two examples:

1. Company A sponsors a plan, they buy Company B. Company B doesn't have an existing plan and adopts Company A's plan. Let's assume the Company A is owned by one owner (100%) but company b is owned by 5 owners - owner of company A included. For plan purposes when we are determining ownership do we look at the other 4 owners of company B to determine for example if they have to take an RMD. In other words do we look at what the ownership is of Company B even though Company A sponsors the plan.

2. Same as above but let's say Company A and Company B are affiliated employers. Company A sponsors the plan and Company B adopts company A's plan. No like ownership but they are an affiliated service group. Do we look at the owners of company A and B for plan purposes or only A since they are the sponsoring employers.