a participant in a 403(b) recently passed away. The Designation of Beneficiary form on file from 1997 states the deceased participants niece will be his beneficiary. Last year the participant married. He never filled out a new DOB form. However, the death benefit will go to his new spouse, correct?

When a profit sharing only plan amends mid-year to add a deferral provision (traditional and Roth), what compensation would be used for testing purposes - full year or only from the effective date of the amendment adding the deferral provision? Is there anything else to watch out for?

Thanks!

A couple of questions

1. If an individual is receiving regular distributions but is not cashing the checks, is it okay to stop sending them? I know uncashed checks are a nightmare and there isn't much guidance, but I'm curious as to what others do in these situations.

2. If you send out the RMD for a person who has not made an election using the default assumptions and the individual later comes back with new information (for example, you thought they were married but it turns out they are single so a 50% QJSA was incorrect) can you retroactively change the old distributions? Can you change the distributions going forward once you've started if it's an annuity?

Thanks in advance for any help.

Plan allows for changes anytime. They have bonuses every year. Some participants may receive multiple bonuses in a given plan year. The company is setting up a new payroll system and had a question regarding the bonus election.

We know that the participant can elect to have a different amount withheld from the bonsus compared to normal pay. For those situations we have the participant complete a bonsus election form. Those that do not complete this form have the same % withheld from bonus as normal. No issue there.

Does the participant need to complete a bonus election for each bonus?

Can the participant complete a bonus election form, say 1/1/13, which would cover any bonus received for the entire 2013 plan year? The form we have does lists the plan year, so could assume it is for the entire plan year?

Could they complete a bonus election form that would cover all bonuses in the future (multiple plan years)? Would it be as simple as adding simple wording that this is for all bonuses received after this date will have "x" percent or zero, etc.?

I have two employees with identical names. The accounting firm or company (not sure who was at fault as far as the bad information) deducted from the wrong one for 3 months.

How do I take care of the deferrals and match deducted for the employee who had opted out. Do I process redemptions and have the employer

return the deferral dollars minus taxes and used the match dollars as a credit?

How do I make the employee who requested that deferrals begin 3 months ago whole? Must the entire amount (deferrals and match) be paid

in for the employee who became eligible and opted to participate?

We are a financial advising and 401k recordkeeping firm and have been holding on to and filing away the piles of custodian statements we receive each month from our 401k plan custodians. We never use the paper statements because they are available for download online at any time and it is much easier to go online to get them then dig through files.

Is there any law that states we must keep paper copies of statements if they are made available online?

Thanks

During 2012 an ineligible employee had deferrals and employer contributions deposited. These contributions were forfeited (during 2012), he was made whole outside the plan for his deferrals and the employer will use the forfeitures as defined by the plan document, to reduce future contribuitons.

Would these contributions be included in the "other contributions" on the 5500 and would the sponsor be able to deduct them?

In designing a new 401(k) plan with a safe harbor hardship w/d option, the sponsor would like to discourage hardship withdrawals by making the compensation earned during the suspension period ineligible for the profit sharing contribution. I've not seen that before. Does anyone see a problem with that?

Situation is Plan terminated in 2010 and final 5500-SF filed for 2011 (January 2012) after supposedly all assets, including insurance contract cash values were distributed. Insurance agent who provided us with the information that everything was paid out, calls us beginning of June and informs us that there was one additional life insurance policy still in force in the name of the Plan. Kicker is the insured is now deceased and there is a $500,000. death benefit to be paid.

Questions are:

1- We presume that we have to file an amended 5500-SF for 2011? If so, do we just show the assets as the 12/31/11 cash value or the cash surrender value?

2- If the presumption is correct for 2011, then we would do the same for 2012, using the 12/31/12 cash value or surrender value?

3- For 2013, there will be a $500,000. payment to the beneficiary (wife), how do we account for the increase in value? Should we just show the cash surrender value as the distributable amount?

Any help in this matter will be greatly appreciated!!!

Thank you.

DPS Rich

Are there any investment restrictions regarding how a 457b for a tax exempt organization can be invested? This plan covers just the CEO. For example, can they invest in stocks, bonds, ETF's etc, or does it have to be exclusively mutual funds or insurance products, etc.

Any sites you can provide regarding restrictions would be very helpful.

Has some good ideas, but this one caught my eye as a HORRIBLE idea:

• QDRO expenses—retirement plans of all types would be required to allocate QDRO expenses to the plan as a whole and not to the individual(s) involved in the specific domestic relations order.

Here is the situation:

A money purchase pension plan failed to make contributions for 2008 for a participant due to a payroll coding error. This was discovered in 2012 and corrected according to EPCRS.

Auditor is suggesting that we may need to file Schedule G, Part III for Nonexempt Transactions.

Is this correct? I have never before heard of a Sch G being filed for a case of missed contributions.

Plan document provides that forfeitures are added to the employer profit sharing contribution. Plan sponsor decided not to make a profit shairng contribution so they profit sharing allocation is the forfeiture. The HCE's ( the 2 owners are the only HCE's) want to opt out of that allocation and just have everything reallocated to the other employees, Technincally it doesn't follow the document, but I guess I just don't see a consequence. Would an IRS or DOL auditor really come in and force corrective action that results in the two owners getting additional allocations? I don't see that happening.

Any thoughts are appreciated.

Employee was a participant in a pension plan located in Massachusetts and also was a resident of Mass.

Participant terminated employment in March of 2013 and has moved to North Carolina (so was a resident of MA beginning of year, now resident of NC).

Has requested payment of his lump sum (not rolling over). Question is whose state tax do we withhold: MA (where he worked and where the benefit was derived from) or NC (where he is now a current resident)?

Is it possible to change from a participant. directed

account to trustee directed?

If it is, what steps must be taken?

Plan was established in 2008 as a safe harbor match plan.

Client decided to drop the safe harbor provison effective 1/1/13 and added a discretionary match and chose Prior Year Testing for 2013.

Prior TPA did not run an ADP/ACP test in 2012 since plan was safe harbor.

What do we do now?

Can a cross-tested profit sharing plan use accrued-to-date method based on average comp with a corrective amendment bringing in a NHCE who is not yet eligible?

Can't seem to find anything that prohibits this.

Thanks.

Are rural cooperatives, as defined under §501©(12), allowed to sponsor a 401(k) plan? Also, would the plan be maintained as an ERISA plan or a governmental plan?

Privately held corporation issues stock to employees upon board approval. Stock is fully vested at time of issuance and corporation treats issuance as payment of compensation to employee in an amount equal to "50% of book value", which amount is included on employee's W-2 for year of issuance. Stock issued to employee is subject to a stock purchase agreement that prohibits transfer and requires employee to sell, and corporation to purchase, the stock at "book value" upon employee's termination of employment. "Book value" is determined each year by the corporation's accountants.

Assume that the stock issuance is a "transfer of property" for purposes of Section 83. In the event it turns out that "50% of book value" is less than current fair market value for the stock at the time of issuance, is this strictly an issue under section 83 that is not subject to 409A (see Reg. 1.409A-1(b)(6)) or do we have a potential 409A deferral of compensation issue because of the undervaluation of compensation and right to payment potentially in a later tax year?

It seems to me this is a section 83 issue and to the extent "50% of book value" is less than current FMV, then the employee has not included sufficient income under section 83(a). I suppose the "payment" of the stock to the employee could also be excluded from 409A under the short term deferral rules, so long as it is paid within the applicable 2 1/2 month period following approval by the board.

Any thoughts would be appreciated.

Is it possible to have two separate match formulas in a plan?

There are no HCEs who work for the non-profit company, and the question was asked if 2 groups of employees can have separate matching formulas.