WDIK

Appleby: I think that many profit sharing plans that allowed after-tax contributions capped the amount at 10% because that corresponded with the old annual additions limit of 25%. (15% max to PS + 10% after-tax) I don't think that there is a percentage cap, except as may be imposed to pass the applicable testing.

One place is on page 4 of the Form 5500 instructions.

If records were kept on the average length of posts on these boards, my bet is that Blinky would have the shortest average length.

If you'd rather not list them, encourage your clients to allow for automatic cashout's under $5,000 and then pay out those participants prior to the filing deadline.

I don't know if there is a specific percentage, but 20% is often used as a rule of thumb, probably because this is a specific question on Form 5500. I am fairly certain that in a couple of instances I have dealt with, reporting over 20% invested in real estate triggered an audit. However, these were for defined contribution plans. Since the DB does not have individual accounts, I would not think that it would draw the same scrutiny.

My understanding is that you would list all participants with any unpaid account balance. I agree with your final paragraph (even though you posed it as a question). Don't forget to include on the SSA previously reported participants that have been paid out and are entitled to no future benefits.

I don't "Relish" your situation.

I read QDROphile's comment on plan language as pertaining to the plan participant. This also ties in with his earlier statements about the "husband" not being able to roll over unless there is a distributable event.

Pensions in Paradise: Does the document language you refer to state that a plan participant is entitled to an immediate distribution if a QDRO applies to his/her benefit, or rather does it indicate that the alternate payee may receive immediate distribution of his/her segregated benefit?

Is it possible that the 401(k) plan was set up using a negative deferral election (in other words, participant's are deemed to have entered into a deferral agreement)? Even so, the participant still has the right to change our opt out of the deemed election. The facts as presented are still somewhat confusing and don't seem to correlate, as pointed out by others. (FICA exemption, matching, salary reduction, etc.)

Here are some old threads: http://benefitslink.com/boards/index.php?showtopic=17770 http://benefitslink.com/boards/index.php?showtopic=12305

In the case of a new safe harbor 401(k) plan, each eligible employee must be given written notice at least 30 days (and not more than 90 days) before the plan's effective date. The initial distribution of the summary plan description must be no later than 120 days after the adoption date.

On the basis his advice was verbal and not written?

What were the total deferral amounts during the 2002 calendar year? Of the $7,800, how much is attributable to calendar year 2002? What are the deferrals to date for the 2003 calendar year?

As someone who had to type Form 5500's for a time, I'm happy with anything that doesn't require White-out. Although it has limitations, Accudraft SmartForms is one of the least expensive I've come across. I do not particularly like the Q&A format for filling out the forms that Accudraft uses.

Dear Custodian: Please deposit the attached check in the amount of $0.00 and apply it to the match account of all non-deferring participants immediately so that our plan will be in compliance with prescribed rules and regulations. Yours truly, Mr. Tungin Cheek

First, I assume (never wise) that the plan language defines the safe harbor match with language such as "an amount equal to the sum of (a) 100% of elective deferral contributions up to 3% of your Compensation, and (b) 50% of your elective deferral contributions above 3% up to 5% of Compesation. I also assume (no we're in dangerous territory) that because of the immediate eligibility that Compensation will include salary since date of hire. The terms of the document should clarify the definition of Compensation. EDIT: (Beat to the punch)

How could it be a match if no salary deferrals are made? I agree with Belgarath.

Just to clarify, contributions to a pension for a self-employed individual are deducted on Line 31 of Form 1040 rather than on Line 19 of the Schedule C.

Changes made to the language of a prototype document result in an individually designed plan. An altered plan would no longer be able to rely on the prototype's opinion letter.

The relief under the DFVC Program is available only if Form 5500 is required to be filed under Title I of ERISA. Form 5500 filers for plans without employees are not eliglbe since they are not subject to Title I.

Am I being cynical? News Article?

"[T]he administrator of any employee benefit plan shall furnish annually to each participant of such plan and to each beneficiary receiving benefits under such plan (other than beneficiaries under a welfare plan) a summary annual report conforming to the requirements of this section." (29 CFR 2520.104b-10(a)) As you can see, no specific date is mentioned in this cite, but I have always understood it to mean that the SAR should be distributed to all who were participants or beneficiaries during the period covered by the SAR. (In your example 1/1/02 to 12/31/02.) I have heard arguments on the other side, but I'd rather be safe than sorry.

1) Is there any language in the document that addresses your situation? 2) Is the question merely academic, or does it make a difference in the employee's account balance/accrued benefit? 3) I have understood the common-law test (with its multi-pronged tests) for determining employee status to apply in these circumstances, so the determination would be made based on the facts and circumstances. 4) I am conservative by nature and so would tend to err on the side of the employee, unless I had a compelling reason to think otherwise.

Honestly, I'm not sure what else needs to be proven to the agent either. In this instance, I do not have a personal interaction with the agent. I am just trying to help a client. The concern, as relayed to me, was that the plan could not have an effective date of 11/01/1997 if the document was executed on on 10/30/1998. The appropriate information has been provided to the agent regarding the deductibility issue, and I would not anticipate a problem there. The hope is that the effective date issue will be dropped once the deductibility is resolved.