Lori H

the agent is pretty much out of the picture. Thanks Belgarath for the answer

So....if they shut down the plan, he is required to pay tax on the cash value? You can not change the ownership from the plan to the participant? Since the face amount is not really much coverage against the cash value and he is most likely not insurable, then that's basically his only option....pay the tax on the csv. I think this is one of the reasons why insurance in qrp's is a bad idea. Thanks for your input

terminating single participant plan has a whole life equitable policy with a face of $52,800 and a CSV of $30,000. The policy could be rolled over to an IRA, correct? They would just restyle the name of the policy and change the beneficiary on record. The participant is in poor health.

thank you

a MPP plan is freezing, future benefit accruals are ceasing? Would hours of service after the freeze date continue to be counted towards vesting?

It is my understanding that the "Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010" reversed expected cuts in Medicare payments. Have I missed something? I think so David. Further cuts may be on the horizon too according to physicians in my area.

Physicians group has two plans Safe Harbor 401(k) and Money Purchase. Yes, they have been told to terminate the pension plan in the past, but "liked the investments". Now that medicare has cut their payments by 21% and possibly more, they are scrambling. They are having a hard time paying rent, much less the $437,000 contribution receivable that is due for the plan year ending 12/31/09. Going forward would a good course of action be to issue a Section 204(h) notice asap, freeze the plan, therefore limiting their 2010 plan year funding for the date the freeze took affect? They will have to fund based on comp paid to eligible participants up to that date. They could then rollover the assets into the Safe Harbor plan or merge the plans? For 2009 I believe there will be a 10 percent excise penalty involved on the UNPAID amount if they can not fund the plan by 8 and a half months after the plan year(Sept 15). I assume a lot of physicians will have problems due to the new medicare cuts. This particular plan has 51 participants. Has anyone had problems with pension plan funding? Do you think these reasons would be reason to apply for a waiver? Probably not. And I would assume the plan could not be merged with the Safe Harbor until the funding was made?

a flooring contractor is considering establishing a plan. He employees several Hispanics who will work on a job, then they may not work again for another few months. My thinking is that they probably would not meet standard eligibility requirements, but is there a procedure when terminating employees and then rehiring them that he could implement?

If the the plan is participant directed and the financial institution that handles the plan assets provides at least quarterly statements to the participants or they have daily access via the internet, would this not satisfy ERISA Sec 105(a)?

What is the recent requirement for participants to receive a statement of their account? Who is to provide these (outside the plan sponsor) and how often? For example, if a plan has pooled accounts and the TPA only provides annual statements are they required to provide statements at least quarterly? Thank you

Thanks. its not collectively bargained. about 78 participants. The problem is that forfeitures/shares are reallocated and that kinda throws everything off, as now the active participants have too many shares and the post 2006 terminated who were paid out, were paid short.

Thats the problem Kevin. The plan has been operating under a 7 year schedule for 2007 and 2008. They did not amend by 2009. Is this a SC filing issue?

thanks for the link Tom. good, clear info.

Kevin, it was leveraged years ago, but no outstanding loan as of that date. So if the plan was to go 6 year, by what date should this have been adopted? 12/31/06? The last work the attorney did on the doc was in 2007. Thank you for your reply

I know certain DC plans can exclude collective bargaining employees or non resident aliens, but what situations can this apply to DB plans? A long time employee has never benefited from his company's plan. Assume he met eligibility requirements.

an attorney drafted a EGTRRA document in 2005 it was adopted and the company then amended the plan in 2007 to change the NRA and received a revised SPD. Curiously, the vesting schedule remained at 7 year graded. This plan should have been using the accelerated 6 year schedule effective 1/1/07 for new participants, correct? The plan is on a remedial cycle E and has to be submitted for determination by 1/31/11.

a bank esop is asking for a SAS-70. They read an article about "Proper Employee Benefit Plan Documentation" and it recommended that they keep a copy of it on file. However, is that required with Employer securities? They do have some cash assets, but wouldn't a SAS be provided by the entity that invests the money?

had nothing but problems with relius software. do you think they will automatically extend deadline for 2009 plan filings? especially since its right on top of EGTRRA?

So, you could use QNEC's to satisfy the ACP and QMAC's to satisfy the ADP. I guess since the employer funds both they are one in the same?

an Adoption Agreement states "In computing the ACP, the employer shall take into account and include as Contribution Percentage Amounts: option 1) Elective Deferrals and/or 2) QNEC's under the plan or any other plan of the employer." I thought elective deferrals/QNECs applied to ADP and employer match/QMACs applied to ACP? Is my thinking wrong?

lol. actually we do....and a fax machine.

Well we have downloaded the old schedules from the DOL but can not add the plan info to them? There must be a simple way to add the old schedules to the DFVC filing where you can fill out the info (i.e. Schedule P) and save them. Do you have to use a typewriter then scan them?

we have been told that they do not like "&" either.

Austin, thank you kindly and no offense taken. Generally on these K-1's the members blow by the 415 limit. This case is different. The company CPA is reporting 6 month k-1 151,541 in SE earnings then reduced that by Sec 179 deductions of $3759 which gives a net of 147,987. The CPA is basing the participant match on that amount, in this case, a Safe Harbor 4% match of $5919. The CPA is also allocating a $12,900 PS allocation. They are reporting Gross pay on w-2 of $80,085. By “employee cost” if you mean her deductions and match BEFORE becoming a member, yes that has already been deducted in arriving at her member earnings. I am not sure what comp number you use to determine this participants SH Match???? Do you have to back out 1/2 SE tax out of the Net SE Earnings to determine what the participant receives as a match?

an employee received w-2 earnings for 6 months of a plan year then became a member and received a K-1 for the remainder of the plan year. My concern is only how to determine K-1 earnings for plan purposes. If she had $151,541 of SE earnings (line14(a) of K-1) and you deduct $3,554 as Section 179 deductions(Line 12 of k-1), would that amount ($147,987) be what you use towards 415 limit of $245,000? The plan defines comp as w-2 wages with the only adjustment being the exclusion of comp while not a participant.