Effen

Many unknowns here, so it is hard to tell what happened. One thing you said peaked my interest, you said, "I did receive my 50 percent share in 2013, while he was alive". Did you mean, you received 50% of his benefit from 2013 while he was alive, then it stopped when he died? Can you tell if your QDRO was a "separate interest" or "shared interest". Does it state that you will receive a portion of his benefit, or does it say that the portion of his benefit assigned to you will be converted to an annuity payable over your lifetime? In other words, were you just receiving a portion of his benefit (shared interest), or were you supposed to receive your own life annuity, independent of his elections (separate interest). What you described sounds like a shared interest QDRO. Did it explicitly state that he was required to elect a Joint and Survivorship annuity on the piece that was assigned to you? Without seeing the QDRO it is hard to determine if anything was wrong. It is possible the administrator screwed up, but it is also possible your attorney screwed up when they drafted the QDRO. Don't let the PA tell you it was your ex's fault. It is the PA's responsibility to ensure the terms of the QDRO are followed. The fault is either with the PA, or your attorney, but likely not your ex.

I think you would just show the funding deficiency. If the plan was terminated before YE, then no additional SB is required. You could report on the 5330 that the payment has been made. The "audit risk" is in the reported funded deficiency. If they audit, that is when you would show them it was paid. I think some people just pay the 10% excise tax, and never actually correct the deficiency. If you don't have the cash, terminating the plan allows you to walk away from the final contribution for 10 cents on the dollar.

Good question...there is no less restrictive position for collectively bargained plans that I am aware of. Generally, if a person has no contributions for 6 - 12 months, that means they are not working for any contributing employers, or at least in a capacity that requires a contribution. It is possible that the person moved into a different job class that would not require a contribution - say from union to management. In that situation, I agree that the distribution might be a problem. I think it would be prudent to confirm the participant is no longer working for a contributing employer before the distribution is paid.

A few small comments on David's response: I would say, on the death of the Participant a survivor annuity MAY BECOME payable to the Alternate Payee. I have seen "shared interest" QDROs written that the AP receives no death benefits and all of the death benefit is paid to the current spouse. In other words, the AP doesn't always receive the death benefit, but it depends on how the QDRO is written. Also, since you said your husband was a police officer, it is also possible that the plan's QDRO procedures, or state/municipality are not permitted to accept a separate interest QDRO. Generally, the administrator should have no opinion, so my first flag is when you said, This is not something the PA should not be in a position to change, unless there is some statutory reason why a separate interest isn't permitted, which might be possible with a police plan. Either way, they can't just change it, but would need to document why that was an issue.

This board is for "Multiemployer" plans, not "Multiple Employer" plans. You might get better responses in the Retirement General, or one of the Defined Contribution Plan oriented boards - I am moving it to the 401(k) Board.

This board is for "Multiemployer" plans, not "Multiple Employer" plans. You might get better responses in the Retirement Plans General, or one of the Defined Contribution oriented boards. I am moving this to the 401(k) Board

Brentwood Asset Advisors is also a good source. October Three may also be able to help. May not need an RFP, but you should talk to more than one. That said, did you really mean 390 participants and only $2 million of assets? That averages just over $5,000 per participant? Seems very low. You can also go directly to the insurance company on behalf of the sponsor. If you really only have $2 million, I would start with Mutual of Omaha, Pacific Life, & CUNA Mutual.

If your QDRO is a "separate interest" QDRO, the death of your ex-husband should have no impact on your monthly payments.

If you have a SSN, an address search would cost less than $20. Seems like the least the PA could do is ask the participant for the ex-spouse's SSN and do a quick search. If he won't give you her SSN, that is probably a pretty good indication he doesn't want to find her.

You need to talk to the plan's actuary.

Crickets .... hmm? I thought Ray J wanted to have a dialogue?

Well, at least I doesn't haft to call you Johnson ? I agree that it would be good dialogue to hear the reason's why one-participant small business owners do these. We are all ears...

Well, first, a cash balance plan is typically an "ERISA qualified defined benefit", so that isn't an issue. Secondly, a cash balance plan still has an underlying annuity value. It might not be expressed that way on benefit statements and illustrations, but the cash balance benefit has an underlying annuity value. When you say, does the AP have a right to take a "separate interest allocation" do you mean can I split the CB benefit like it is a DC plan and assign a portion to each person, or do you mean can I use a standard "separate interest QDRO" where the APs benefit is independent of the participant? I don't see any problem with either, as long as there is an actuarial adjustment for age differences. That said, depending upon the CB formula, the AP should determine if they are better off taking a % of the current cash balance, or if the more traditional "ultimate benefit times coverture fraction" would be better. Since the actual rate of accrual, expressed as an annuity, typically declines with age under most cash balance plans, the AP might be better just taking a piece of the current benefit.

You can pay the "High 25" a lump sum in connection with the plan termination, but not before. Also, logically, if you have enough to pay them a lump sum, then the plan will be more than 110% funded since the lump sum will likely be more than 110% of the funding target. If they are going to terminate the plan, do everything in connection with termination. No need to do any "windows" if the plan is being terminated.

I agree with David and add that offering a lump sum to a retiree creates a new Annuity Starting Date. That means they should be given all plan options, not just the ability to convert their current annuity into a lump sum. This mean fresh spousal consent and new J&S options with current spouse if remarried. This will create adverse selection concerns as retirees adjust their new payment form to fit with their current health. Also, insurance companies will price the annuities differently if they know lump sums have been offered and declined. Maybe not enough to offset the savings on those who took lump sums, but it is something else to consider.

If they were truly employee contributions (that is deductions from his paycheck), then he would be entitled to that money back, with interest. That is always the case, even in a plan that has no employer provided death benefit. It is not uncommon to have a pension plan that provides no death benefits for non-married participants. These are "retirement" plans by definition and only pay spousal benefits because Congress makes them. Was this a union plan? I ask that because sometimes union contribution rates are expressed as a $/hour contribution and negotiated. The members often think of this as their money and their contributions, but technically, they are employer contributions and therefore could be forfeit on death. The SPD likely contains the answer to all of your questions. If there are employee contributions, there would be a section in the SPD related to them.

It means just that. The sponsor is guaranteeing the EE contribution will earn 3.75% per year. The sponsor is bearing the investment risk and is guaranteeing the rate of return. Normally, the EE contribution goes into the value of the total benefit. If the EE terminates before becoming vested, they would get their EE contributions, plus interest back. Sometimes, there is a similar provision related to death where they are guaranteed at least a return of contributions. In other words, in most situations, the value of the EE contributions isn't really relevant since it just gets swallowed up into the overall benefit. The sum of the EE contribs would impact the taxation of the ultimate benefit, assuming they are post tax contributions. Typically the employee contribution rate is below 5%, so your example of $10,000 is very high, but not impossible for a highly paid person. Also, a typical calculation might assume monthly/weekly contributions and therefore, often 50% of the rate is credited in the first year. Therefore, it might be something like (10000 * (1.035)^.5) * 1.035. (Looking at your OP) Lots of variations and not a common provision outside of governmental plans.

Are you are participant in this plan? Is this a cash balance plan?

This same question was recently posted on the ACOPA Board. On that board people commented that if the last day worked rule only applied to HCEs, it might be ok.

I agree with Jpod. My understanding is the MRC must be cash, but any amount over that can be in-kind, but I would definitely get the sign-off of an ERISA attorney.

I think your best option is to address this in the amendment that changes the eligibility provisions to bring him into the plan. Make sure that amendment clearly defines if you want to count his past service, or if you want him to only accrue benefits from his date of entry. I don't think there is any "rule", but you need to follow the plan provisions. Is this person an HCE? If so, I would recommend that you only count future service. Otherwise you could have some non-discrimination issues.

What non-discrimination test failure are you looking to correct with an "11(g) amendment"? I don't think you can amended the plan now (in April), to increase benefits for 2018 and recognize it in your 2018 funding valuation. I think -11g is only used to correct a failed non-discrimination test. Am I misunderstanding something?

I think anything that you can demonstrate is non-discriminatory under the applicable regulations (410(b), 401(a)(4), etc.) would be acceptable.

I am not sure, but i found this old thread that says you can't. https://benefitslink.com/boards/index.php?/topic/36446-eliminating-actuarial-increase/

As long as the accrued benefit payable at 62 is protected, there is no problem setting an older age for new accruals. You may also consider simply changing your actuarial assumption to 65 for valuation purposes. That would avoid the need to change the plan document. You will need to also make an assumption regarding suspension of benefits notices (if your plan document calls for them.) In other words, for a one life plan you have a lot of flexibility. You can either actuarially increase the benefit from 62 to age 65 in your funding, or, if permitted, issue a Suspension of Benefits Notice at age 62 and ignore the actuarial increase - assuming they are still active.