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?

Given: Combined DB/DC plan

DB and DC service Eligibility = 1,000 hours

Condition for DC allocation = 1,000 hours

DC is a 3% Safe Harbor 401(k) Profit Sharing Plan

Participant has 1,500 hours in 2011 and 800 hours in 2012

Since participant satisfies 1,000 hours in 2011, he must get 3% safe harbor in 2012 even with less than 1,000 hours.

Question: In 2012, should participant also receive the excess DC allocation to satisfy the gateway/401(a)(4) requirement even with less than 1,000 hours?

Thanks.

If the 2012 5500 audit for a multiple employer plan is complete, and one of the plan adopters declares a 2012 employer contribution after its audit is finalized, can the employer deduction be included on the 2013 5500 even if the employer takes the deduction for 2012, or must the employer deduction be the same year for the 5500 and the corporate tax year? (assume both calendar year).

The Plan Administrator did not want to go through the hassle of appending the audit report.

A participant in a 401(k) plan has $6,000 in his deferral account and $50,000 in his profit sharing account for a total of $56,000. He is fully vested. The plan allows loans but only from the deferral source. Is the 50% limit based on his entire account balance or just the deferral account balance? If on his total balance, the maximum loan amount would be $28,000 but then limited to the $6,000 in his deferral account. If on his deferral account only, he could only borrow $3,000. Thanks.

Does the still employed father of the sole owner get an RMD at age 70.5? The father was once the owner. Not sure if the family attribution rules would still apply to the father here.

Employer has a particularly difficult employee whose English is spotty, and who is determined to take "all of my money" from the profit sharing plan when he leaves the company next month.

Does anyone know of an explanation of the mandatory withholding rules in Spanish?

Employer failed to withhold on Group Term Life Insurance Premiums. The definition of compensation under the plan is W-2 and the client has stated that these amounts are included in each persons W-2. The plan is an enhanced safe harbor match 100% up to 5%

1. Based on our understanding of EPCRS the employer is required to fund a QNEC for 50% of each participant's election percentage. However the safe harbor match for the missed deferral amount should be based on their entire election percentage and not on the corrective QNEC amount. Is this correct?

2. The client has not included this compensation for 7 years going back to 2007, based on our research you can only self correct going back 2 years. However there is a section that we read that states if the mistake is insignificant you can go back more years. The GTL amounts that the client wasn't including as part of comp were very small amounts. The most would be $300 for a participant, therefore the QNEC and match that would be funded would be minimal amounts. Do you agree that this is considered an insignificant error and the plan could self correct all 7 years and not go to VCP?