WDIK

You can find a previous discussions here.

Whether 'tis nobler in the mind to suffer The slings and arrows of outrageous and ambiguous legalities, Or to take arms against a sea of troublesome plan provisions, And by opposing end them? To terminate: to invest; No more; and by an investment to say we end The heart-ache and the thousand natural shocks That pension administration is heir to, 'tis a consummation Devoutly to be wish'd. To return, to invest; To invest: perchance to charge some fees: ay, there's the rub; (Liberties taken are shown in italics.) My advice is to justify either position based on plan language and policy and consistently stick with that position unless/until you are proven wrong. P.S. If the plan already acknowledged that it would receive the rollover prior to the employee terminating, I would probably accept it.

Hence all the time spent perusing and posting on these boards...

Some thoughts: 1) If your plan document specifically reads that an entry date is a "plan year quarter" and you were to take that literally, the short plan year quarters would begin on 5/1, 7,1, 9/1 and 11/1. (Quarters implies four and an eight month period would be divided into four two-month periods.) 2) If the document language is somewhat ambiguous regarding what quarterly entry date means, the plan administrator should make a reasonable interpretation. 3) In many cases, entry date language for short plan years will indicate whether or not the first dat of a short plan year is also considered an entry date for plan purposes. In answer to your question, and based on most plan language I have seen, it is most likely that the document would be interpreted to provide entry dates as of 1/1, 4/1, 7/1 and 10/1 with a possible entry date on 5/1 for the short plan year. CAUTION: I have not read the plan document, so my opinion is pure speculation.

Several weeks ago I sent an email to one of the board administrators asking a similar question. I never received a reply and dropped the subject assuming that it was highly classified information. I am glad to know that I am not the only one sticking my nose where it doesn't belong.

What led up to the excess contribution being made? Are other plans involved? What is the plan year and when was the excess contribution made? What size of a plan is it?

Doesn't the benefit available merely boil down to whether he is legally married or not? (Or are you asking for precedent with respect to the determination of marriage status, in which case I apologize for simply restating your post.) Edited for bad punctuation.

It is my understanding that qualified retirement plans that cover only the owner and the owner's spouse are not subject to the bonding requirements.

Harwood covered himself since I wouldn't classify this topic as a "pension-related thread."

I would think that a plan amendment changing the sponsoring employer would be sufficient.

Code Section 151(d)(4) addresses the adjustments for inflation.

Ownership still applies in determining highly compensated participants.

Is it to tie in with the threshold for the mandatory 20% withholding?

I agree with No Name that it is a two-step process. First make the corrective distribution (applying the applicable tax consequences). Second make a contribution to an IRA (applying the applicalbe tax consequences). (I am confused, however, as to why No Name's money is moldy, nor do I know why No Name is pondering about phases of the moon.)

For one thing, a 204(h) Notice must be provided at least 15 days (for small plans) before the effective date of the plan amendment that reduces the rate of accrual under a plan. I believe the excise tax is $100 per day per participant if the notice is not issued properly.

What you said......

UBTI = Unrelated Business Taxable Income UBIT = Unrelated Business Income Tax (or something like that) so... UBTI is subject to UBIT

ChopperPilot: When you use the term startup, I'm not sure if you were referring only to the plan or to both the plan and the employer. If you are dealing with a new company that started 1/1/2005, then I agree with PATA. If the company was already in existence prior to starting the plan 1/1/2005, then you do have a look-back year on which to determine HCE's based on salary.

Personally, I like this approach better than changing the predecessor service provision.

Archimage: Are they trying to fully vest only those employed on the effective date of the plan and apply a different vesting schedule to future employees? Also, if you don't mind sharing, what prototype document are you using?

I have seen this situation once before. If I remember the circumstances correctly, the employer sponsoring the plan was required to file their payroll tax withholding electronically. This was confused with their retirement plan withholding (they may have filed those taxes under the employer identification number, I don't recall). If memory serves they were able to resolve the issue with the IRS with a letter of explanation.

Related Discussion.

From Shakespeare's Romeo and Juliet - What's in a name? That which we call a rose by any other name would smell as sweet.

Until the plan year that the other employee becomes eligible a Form 5500-EZ can be filed. If assets are below the filing threshhold, no filing is necessary.

Let's make it tomorrow and I can get some things off of my chest today. Seriously however, I can support such a concept.