Hello,

I'm stumped and just need a reality check.

Here's the pretty simple fact pattern:

A public School District and a local Community Clinic (a health care provider) have entered into an arrangement whereby the Clinic will provide a day of health screenings for students in the District.

The Clinic has asked the District to sign a Business Associate Agreement.

The Agreement identifies the Clinic as the Busniess Associate. The District is referred throughout the agreement as the 'Facility' (where screenings will occur). And the Agreement refers to services provided on for or on behalf of a Covered Entity (which is not defined). I asked them to identify the CE, and the Clinic to me it is the District?!?!?!!? (That must be incorrect - District is not a health care provider, and not a CE).

Just to clarify, the District's Health Plan has no involvement here. This is just a Clinic (a CE) coming in to provide student health screenings. It is not clear to me why a business associate agreement is even needed, in that the District won't be providing services for, or on behalf of, the Clinic that require the use or disclosure of information.

Do you agree?

If the parties insist on having an agreement in place, I want to ask them to clarify that the Clinic is the CE, and that the District is a BA, but only to the extent that it should provide any services for or on behalf of the Clinic. Thoughts?

Thank you!

Seeking information about health plan coverage for dependents in active military service. Do you exclude for eligibility purposes or have exclusions for coverage of military service related diseases, injuries or illnesses or none?

Thanks.

A plan participant completes beneficiary forms for the company's retirement plans, then dies a couple of years later. The company says that because the validation form that was sent to confirm the named beneficiaries was not returned, the plan assets must go to the participant's estate. I suppose the named beneficiaries can hire an attorney and appeal. Is getting a second form to validate the first form becoming a trend, or is this company out of line?

A pooled 401k Plan wants to make an investment in a limited partnership. Plan will purchase 50% of the LP from an unrelated party, and the owner of the Plan sponsor will purchase 50% of the LP from an unrelated party.

Is this a prohibited transaction? I wouldn't think that simply being related to the other owners would create a PT. As an example, the Plan could by Microsoft stock and the owner could also by Microsoft stock without engaging in a PT (assuming the shares were acquired from unrelated parties).

I am unsure how much of the PFB to burn in the following scenario:

2011 FT: $163,759

2011 AVA: $162,793

2011 COB: $0

2011 PFB: $26,762

2011 AFTAP: (162793 - 26762)/163759 = 83.06%

2012 AFTAP not certified by 4/1/2012, so AFTAP drops to 73.06%. I think that there are two ways to calculate the deemed burn:

Method 1: Assume that the 2011 FT increases to $186,190 so that the AFTAP equals (163793 - 26762)/186190 = 73.06%. Then I should burn $12,922 of the PFB so that the new PFB is $13,840 and the new AFTAP is (163793 - 13840)/186190 = 80%.

Method 2: Assume that the 2011 AVA decreases to $146,405 so that the AFTAP equals (146405 - 26762)/163759 = 73.06%. Then I should burn $11,370 of the PFB so that the new PFB is $15,392 and the new AFTAP is (146405 - 15392)/163759 = 80%.

Are either of these approaches correct?

Any help would be greatly appreciated!

This is actually a follow up question to my last post but I thought it would be easier to start a new topic

The background is that the employer failed to withhold on Group Term Life Insurance Premiums which is on the participants W-2. The plan is an enhanced safe harbor match 100% up to 5%. The real problem is that this has been going on for 7 years.

We have calculated the correction based on EPCRS, which is the 50% of the missed deferral opp and the full sh match.

The issue we have now is how to calculate the interest. We have read that using the DOL Calculator is acceptable however the client is unwilling to go back to their payroll records for the past 7 years to let us know every payroll the GTL was attributable to - in order for us to us the DOL calculator.

Is there another "easy" way of calculating interest on missed deferral opportunity?

In a plan subject to QJSA rules, who usually provides the required QPSA notice (which has very specific timing requirements tied to an employee's age)? Does the employer typically provide this notice or is it the plan's TPA?

I read in a Relius Technical Update (from October '12) that the DoL might not be so crazy with self-directed brokerage accounts, especially if there is a near-limitless investment universe.

The piece has phrases as "The DOL could contend..." or "the DOL may argue..." Relius's point being that if you have all these investment opportunities, it may be too much, and the plan sponsor might not be able to furnish ample and appropriate investment information.

Is there any DOL correspondence stating the DOL position on brokerage accounts? I read FAB 2012-02R and it has stuff like fiduciary responsibility still applies with regards fees and services. But nothing about the concerns made in the Tech Update.

I didn't see an ASAP with anything similar, either.

Your thoughts are appreciated.

Plan Sponsor is aware the participant is in the process of a divorce.

The participant needs money to pay medical expenses not covered by insurance. The plan allows for hardship. this is a 401(k) Profit Sharing Plan

Since there is a pending divorce, is there a "risk" if the Plan Sponsor distribures the funds due to the hardship?

What happens if the QDRO amount is more than what is in the account due to the hardship payment?

The client received a deferral election from a participant and commenced withholding and remitting deferrals. But treated them as pre-tax when they should have been Roth. This went on for several years. The ideal correction is to create corrected W-2s for all involved years. Is there any simpler option, even if it is not as clean?

We started receiving IRS notice CP283C it seems because we included Part III entry code "D" in our counts on line 6a & 6b. We are now being assessed $64 for each "D" that was included in our 6a $ 6b counts. Can we amend the 8955-SSA removing the "d" listings from our 6a & 6b counts and asking for an abatement of the penalty? Is there any other way of handling?

Thank you for any help.

Here's the situation: DC plan has individually directed investments. Participant has brokerage accounts. Assume all other disclosures - annual, SPD, etc., are correct and timely.

The participant takes an in-service withdrawal, for which there is a $125.00 fee. This fee is deducted from the brokerage account, and the statement to the participant shows the fee, but only says "check to TPA XYZ" - it does not specify what the check is for. The question that came up was whether this, in conjunction with the withdrawal request form which clearly states that there is a $125.00 fee which will be deducted from the participant's account, qualifies as appropriate notice and therefore doesn't require a "redundant" quarterly notice?

I can see both sides of this. This compliance part of me doesn't think this satisfies the letter of the regulation, (because the brokerage statement doesn't identify what the $125.00 is for) but the everyday practical side says that "darn it, this ought to qualify." The compliance side of me is winning.

Just wondering what others think?

The regulation provides:

(ii) At least quarterly, a statement that includes:

(A) The dollar amount of the fees and expenses described in paragraph ©(3)(i)(A) of this section that are actually charged (whether by liquidating shares or deducting dollars) during the preceding quarter to the participant's or beneficiary's account for individual services; and

(B) A description of the services to which the charges relate (e.g., loan processing fee).

The preamble says:

To the extent such a charge is

otherwise disclosed during a particular

quarter, for example by a confirmation

statement after a charge is deducted

from an account, that charge would not

have to be disclosed again on the

subsequent quarterly statement.

Instructions to line 6 of the Form 5500:

2. Retired or separated participants receiving benefits (i.e., individuals who are retired or separated from employment covered by the plan and who are receiving benefits under the plan). This does not include any individual to whom an insurance company has made an irrevocable commitment to pay all the benefits to which the individual is entitled under the plan.

Anyone see a problem with applying this to a defined contribution plan funded with insurance contracts exclusively (i.e., no Trust).

Hello all.

I expect the answer to the question in the title of this post is, No. In the mail today I received a Stipulated DRO. I had been expecting a QDRO. The cover letter attached to the S-DRO does mention that when the S-DRO is returned with notarized signatures, then will the QDRO be filed with the court. After the judge has signed, the QDRO will then be served on the plan. I am miffed to say the least because it was last March that it was clearly articulated and agreed to by my attorney who has been paid to perform the QDRO. Now I find out that the QDRO hasn't even gone out to the court! In all my research I had seen no reference to a S-DRO so I am wondering what is going on. I'm thinking I am not going to sign this Stipulated DRO until after further information is received from professionals. (Of course the mailing was received after 4 PM on a Friday.) I'm so done with the length of this process yet I anticipate further delays. Oh goody!

Thank you for any insight given.

FYI: I've done the divorce pro per, it was signed off by the court last month. The MSA signed off by the judge made specific mention of the terms of the ICMA 457 pension awarded 100% to me, the petitioner and non-employee spouse. Joinders filed last June 2012 but I settled for just the one pension.

I spent several hours looking through this site today. I sure wish I had found this site before now.

Posted elsewhere but haven't gotten any response. Is anybody familiar with the McDonalds Licensees and Ronald McDonald House Charities Health and Welfare Benefit Plan / Trust. It appears to be a Group Insurance Arrangement (GIA) providing fully-insured group health and other welfare benefits to various McDonalds related groups including my local Ronald McDonald House. They Trust files a single Form 5500 for the overall "plan" as a DFE but say they do not prepare or provide ERISA SPDs for the participating employers / entities. Seems each Ronald McDonald House would need to prepare their own SPD and also presumably have some sort of wrap plan document to wrap around the group insurance docs provided by the overall Trust / Plan. Am I thinking about that incorrectly? Anybody have experience in working with this or similar GIA? Thanks.

My client is merging two plans and there are some rules with respect to in-sevice withdrawals that they have referenced below that I am not familar with. Please look at the clients provision and let me know if anyone has heard of this provision based on the information listed below.

In-Service Distributions – For in-service withdrawals of employee after-tax contributions which were contributed on or after the plan merger date, if the participant has not attained age 59½ and if after-tax withdrawals earned a match (e.g. for non-union employees were contributed from the first 5% of a participant’s compensation), then the participants’ contributions to the survivor plan will be suspended for 6 months. This suspension does not apply to withdrawals for employee after-tax contributions made before the plan merger date. This provision is needed to comply with a series of old IRS Revenue Rulings, namely Revenue Rulings 72-275, 74-55 and especially 74-56.

Based on the above information do the Revenue Rulings still hold true? and can participants' contributions in the surviving plan be suspended for 6 months?

An HR-10 plan is defined as a qualified plan that covers at least one self-employed individual. A self-employed individual is defined as an individual who has earned income. A self-employed individual is defined in IRC §401©(1)(B) and earned income is defined in IRC §401©(2).

An S-Corporation sponsors a 401(k) plan. From what I read online, it appears that a shareholder from an S-Corp can receive a K-1 – which is the “shareholder’s percentage of distribution of the S-Corp’s net profit”. Does a K-1 that a shareholder receives from the S-Corp make them a self-employed individual – and thus makes this an HR-10 plan?

I may be oversimplifying my interpretation of a NQDC plan, but it's my understanding that basically an arrangement where a select group of employees will be eligible to receive wages on a future date upon the occurrence of a certain event(s). Therefore, would both the following arrangements constitute a NQDC plan?

1. Employee elects to defer a portion of his/her current salary to be paid at retirement or upon termination of employment.
2. Employer agrees to pay employee $100,000 annually for 7 years upon retirement. No employee deferral contributions.

I am trying to determine if this would be an item the Plan needs to disclose in 408(b)(2) notification. We are third party administrators for the 401k plan and are a CSP. We have referred the plan sponsor to a firm that does physician practice management. These services would NOT be related to the plan at all. The practice management company will pay us a "referral" or "finder's" fee as a percentage what they bill our 401k client for consulting fees. None of these are plan related fees.

Mr. Plumber is a Sole Proprietor of a plumbing company which employs his 2 (adult) sons, his brother and his nephew, among other employees. Is there Section 318 attribution from father to sons, making sons HCEs? Any of the other relatives?