We have a 403(b) Plan that has a graded 401(a) contribution rate based on Years of Service (2% for 2 YOS, 3% for 4-5 YOS, 5% for 6-8 YOS, etc.). If the plan is disaggregated for testing purposes based on YOS, does the Gateway Test need to be passed only the disaggregated segment or do all the NHCE's need to receive the Minimum Gateway on a plan level. The minimum eligibility for the 401(a) contribution is 2 YOS and age 21, so disaggregating on the basis of OE is not the question for this situation.

Does anyone know how this question may pertain to a DC plan? The instructions say to check Yes if benefits due were not paid timely or in full. In regards to a DC plan, is this asking about participant distributions only or employer contributions due? Example, what if the employer forget to contribute a safe harbor contribution for 2 years, but during that 2 year period no participants requested a distribution. Would we check this box as Yes or No?

Has anyone heard what the DOL/IRS may be looking for regarding this question?

Thanks in advance for your replies.

1. A 412 e plan is restated as a Cash Balance Plan. 1 person plan. Do they get a waiver of the 5300 $1,000 fee??

2. A new Cash Balance Plan covers 1 person. Do they get a waiver of the 5300 $1,000 fee??

3. New Plan startup tax credit -- does number 2 get the tax credit for starting a new plan???

I was surprised to learn that Great West has a "principal reduction form" for participant loans. the option reads as follows:

"Principal Reduction Method - You can elect to send a partial prepayment to reduce the principal balance of your loan. To elect this option, mail this completed form and your payment made payable to Great-West Trust Company, LLC to the address indicated below. Consider submitting payment by certified check or bank money order. The payment received will be applied first to the current payment due and then to the outstanding principal balance."

I believe this would violate the level amortization requirement of a participant loan. What do you say? We've always told participants partial payments are not allowed.

Individual was employed from 1997-2003. Plan became effective 1/1/2009. Employee is now being re-hired.

Does the fact that the employee was never a participant remove the credit for the prior service? Or, should the employee be eligible immediately upon rehire because they completed the eligibility requirements (albeit, over 10 years ago).

A participant in a governmental plan wants to remove a disabled spouse as primary beneficiary and name the children. Since the spouse is disabled and the participant is the durable power of attorney for the spouse, can the participant change the beneficiary to the children and where it provides for spousal consent, sign with the POA designation where the spouse would typically consent to the change? Or, as a governmental plan, is the spouse's consent not required?

Thanks

Does anyone know if the required 2013 annual participant fee disclosure comparative chart - the distribution deadline for which was extended to 18 months by FAB 2013-02 - is still required for a plan that is merged into another plan before the deadline for providing the comparative chart? If so, can you provide a citation/source for the guidance on that particular issue?

Thanks!

We have a Governmental Trust Authority that has a 457 with deferrals and loans and a 401(a) with match. The Trust Authority oversees a Tax Exempt Hospital with a 403(b). How do we handle employees moving from one employer to the other? From what I've been told, the Trust Authority appoints the board of trustees for the hospital.

A plan sponsor must submit Form 5310-A to notifiy the IRS when electing QSLOB testing. They must also submit a 5310-A when they revoke such testing.

Does anyone know if filing 5310-A requires the plan sponsor to test on a QSLOB basis? For instance, if the plan sponor files a 5310-A for the 2012 plan/calendar year - but they test coverage and nondiscrimination on a total group basis, ignoring the QSLOB designation, is that okay?

Obviously, testing on a total group basis is allowable (as long as corrections are made timely). But if this was caught in an audit - would the employer be required to re-do their testing on a QSLOB basis due to the fact that they submitted at 5310-A?

From what I'm reading in 1.414®, it appears that filing a 5310-A requires that QSLOB testing be done, and testing on a total group basis would not be allowed.

Thoughts?

A PSP [calendar year] wants to add here in 2013 an EOY employment requirement to Plan. Plan has a 1,000 requirement. Deep in the recesses of my brain a little bird said...whoa--not so fast....any thoughts on this...is it doable.

We are looking into a client management system, as well as a workflow system for our TPA. I've herad about PensionPro, NexusTPA, Pension Portal (EBG), and I hear that FT WIlliam has new software coming out.

Ultimately, we are interested a some sort of a client portal and workflow system that would track time, track where we are on a plan, etc.

I'm curious to see what systems others use and how it's working out?

Can medical expenses be withdrawen tax free from HSAs which were expenses incurred in past years which were not deducted due to being under the 7.5% threshold for the medical expense deduction even though expenses above 7.5% were deducted in those years? Also, can medical expenses which were not allowed because of high income limitations on schedule A deductions be withdrawen tax free?

I know that the method of allocation has to be defined, and I understand this to mean that basically you can't allocate money willy-nilly between different people.

I also understand there are a variety of ways that it can be defined, including a flat amount, a percentage of compensation, or employee classifications.

Can someone clarify whether there is a list of approved methods, or if it can really be anything that is "bona fide" and well defined?

Also, can the classification be something as specific as, say, a particular officer in a corporation?

I have a one-person plan, effective 1/1/2011, which bases compensation on comp prior to 1/1/2011. When calculating the 415 comp limit, do I include comp after 1/1/2011?

Any help would be appreciated!

has anyone had recent DOL service provider audit experience? what does it involve? any insights?

Would appreciate jist of a case study where a private institution of higher learning subject to FAS #106 set up a trust to level cost of tuition assistance provided to retired staff and faculty to aid them in paying for tuition of children, for example:

• Can it be done legally
• What guidelines are there on setting trend assumption for cost increases in tuition
• What investment restrictions are there?

Thanks much,

Ira

As I understand it, when valuing mass withdrawal liability one uses the ERISA section 4044 mortality and interest rates. Should the expense loading factors in Appendix C also be used?

I work mainly with mutiemployer defined benefit and welfare plans, so this is probably a basic question. I noticed on a multiemployer 401(k) plan that some employers may not be paying FICA and FUTA on elective deferrals. It also appears there is no withholding for the employee portion of FICA and FUTA. It is my understanding that elective deferrals are subject to FICA and FUTA and the employer and employee must pay their respective shares. It appears that some employers contributing to the plan are paying FICA and FUTA on the adjusted gross income of their employees (i.e., the employers are not paying the FICA on FUTA on the deferrals) and the employee portion is not being withheld from the deferral amounts.

Am I correct that employers must pay FICA and FUTA on the deferrals and that paying FICA and FUTA on on the adjusted gross income is wrong? What about the employee portion of FICA and FUTA? Should that be withheld from the deferral amount?

Any help would be appreciated.

I am in a situation where I was laid off today and my company hasn't deposited the safe harbor contributions for 2012 let alone 2013. I assume that I am entitled to the 2012 contribution and a prorated 2013 amount but I am hoping somebody can confirm that. As of now I haven't head if the company will honor either or both of them but if they are true to their past they will not honor them.

Any help would be appreciated!

A colleague of mine and I are disagreeing over a plan's ability to provide a disproportionate match as a Safe Harbor contribution.

A disproportionate match, defined at 1.401(m)-2(a)(5)(ii), occurs, generally, where an NHCE receives a match that is greater than both (a) 100% of deferrals and (b) 5% of compensation. So, for example, a match of 200% up to 3% of comp would be fine until you defer past 2.5% of comp (at which point the contribution exceeds 5%).

Generally, the consequence is that the disproportionate portion is ignored for testing purposes. Because only NHCE amounts can be disproportionate, it's meant to prevent trying to game the ADP/ACP test with weird matches.

Here's the issue: In defining a safe harbor match, 1.401(m)-3(j) says the contribution will only be taken into account if it meets 1.401(k)-3(h)(1), which, in turn, says the contribution needs to meet the requirements of 1.401(m)-2(a), which of course includes our friend the disproportionate match rules. The implication, then, is that you couldn't have a safe harbor matching formula that could produce a disproportionate match.

However, there doesn't seem to be any other support such a position. There's been no guidance that I can find on the interplay one way or the other. In all the articles/resources on permissible safe harbor matching formulas, nobody's mentioned the disproportionate match rules as an issue. Further, in laying out proposed safe harbor matching contributions, a number of the big-name providers have included formulas which would run afoul of the disproportionate match rules. Of course, none address the issue explicitly.

Has anybody ever heard of this analysis? Have you dealt with safe harbor formulas that may trigger disproportionate matching contributions?