Effen

Not sure what "annual audit" even means or why it would impact ongoing plan administration. Annual audit by whom? Are they going to adjust your lump sum to reflect interest through date of payment? If your NRD was 8/1, you should receive an actuarial adjustment to reflect the delayed payment. Agree that you should try to find someone on the DB side of the house and ask them what is really going on.

Also, the annuity will needs to provide all of the same rights and features the plan offers (early retirement, optional forms of payments, disability, etc.) The cost is typically 5%-10% higher than the lump sum value, but will be based on the interest rates in effect at the time of purchase.

You can't force the participant to receive payment until they hit MRD. You also don't need to purchase an annuity as the plan can make the payments directly, but if the sponsor wants to de-risk and move the liability to someone else, the plan can purchase an annuity for terminated vested participants. Many plans have "de-risked" and purchased annuities for some / all of their retired and/or terminated vested populations. What you are looking for is called a "single premium annuity" and it it purchased by the plan sponsor, typically through a broker, but the sponsor can work directly with the carrier and save the broker's commission. No participant signature is required. Since you have only one participant that you are trying to annuitize, there are probably only a few carriers that will be interested. Try Mutual of Omaha, MIdland National, or OneAmerica. They are generally the best players in the small market. I can't give you direct contacts, but if you want to pay the broker's commission you can send me a DM and we can get you a quote.

A big thank you to Lois and the entire IT team (is that just Lois?) for cleaning up the site after the major spam attack over the weekend. Every board was littered with messages. These boards are very useful to many people and it doesn't happen without great support. Thank you to the entire clean up crew.

if you are asking if it is a protected benefit, I would say, no, it is not protected, assuming it has no impact on the participant's retirement benefit.

Do what you think it reasonable and in the best interest of your client.

Then yes - you should redo the 22 val and amend the SB. You probably should bounce if off your attorney, but I would Include a letter explaining what happened.

Why are you giving the IRS the 22 val? I thought you said this was not actually under investigation? My response assumed this was just between you and the plan sponsor.

Personally, I wouldn't redo it. Let sleeping dogs lie. Yes, you understated the liability, but they contributed a sufficient amount to cover it either way. If someone asks you to redo it in the future, then redo it then. The beauty of the PPA funding method is everything self-corrects over time. I would suggest that you don't apply any of the excess contribution to the PFB. That way the plan is right where it should be starting in 2023 and no one can argue that your error impacted anything. Plan was appropriately funded, PFB was not impacted, no harm, no foul. I applaud your dedication to making sure the valuation is correct, but in reality, you are probably the only one who cares. Or, go ahead and redo the val and amend the SB if it helps you sleep better.

You said, "If the 2022 year is under examination". Is it actually under examination, or is this a hypothetical question? Who is complaining that the 22 val was "wrong"? For a BOY val date, this w/b perfectly acceptable. Not sure how an EOY val works with mid-year changes, so not sure if they "must" be recognized, or if it is a "may" like a BOY val. Sounds like you think it is "must". "there is a general concept that you can't file an amended 5500 that changes the specs". I don't agree with this. You are not allowed to change assumptions, but I think it is acceptable to amend a filing if you accidently used the wrong benefit formula. Why do you want to amend it? Who is making an issue of the MRC being understated? If you amend it, was the contribution sufficient to cover the increase in MRC?

What is the death benefit for a non-married participant? Is this a contributory plan? You should look a the State's law and see if there are any restrictions on the death benefit. As far as the plan document goes, many states don't even require them, so again, see what the state requires.

David didn't say talk to the "TPA", he said, talk to the "actuary". If you aren't getting good information from the TPA, ask them to let you talk to the actuary. If they refuse, the actuary's name and phone number will be on the Form 5500 Schedule SB. Now, the actuary might be harder to understand than the TPA, but they would be your best source of information.

You said, "reversions are not an option when handling the distribution of residual assets. Instead, the Plan says any excess should be allocated among participants". Assuming that is true, then I agree with the attorney and you can't use a QRP. A QRP is essentially a reversion to the employer, which your client's document does not permit. You can change this wording, but it can't be effective for 5 years. The excess assets need to be reallocated to the participants, and cannot be reverted to the employer. A QRP is an employer reversion since it essentially reduces the cash the employer would have contributed on future DC allocations.

I know of plans that work that way, but I would be on the side of the participants. If they didn't have the check in their hands, I don't see how you can consider them to be paid. Personally I think the concept of annual interest credit is a 411(d)(6) violation, which is the real issue with your post. That fact that some pre-approved documents let you do it doesn't mean it complies with the law. Unfortunately, only real course of action would be to hire a lawyer but since these are small amounts, the sponsor knows that is unlikely to happen. I am not aware of any regulation that defines it, but common sense would say, "if it don't have the check, then I wasn't paid". Your lender doesn't care when you told the bank to send the check.

Yes, that is typically how it works, but Ford's QDRO Procedures will specify their procedures. You should also request a copy of that. On your first item, likely you will get some very long responses after mine explaining things in more detail, but I have seen DROs filed and approved many years after the divorce. I am not aware of any statute of limitations on QDROs. If no DRP is file and you eventually start receiving your monthly benefits, the AP can still file, but their payment options will be limited based upon the optional form you selected for yourself.

Taking a step back. Generally speaking, the attorneys for both parties use the divorce decree to prepare a Domestic Relations Order (DRO). That Order is presented to the Plan Administrator (PA) for review (is it understandable, does it violate any plan provisions). The PA is not looking to see if the DRO satisfies the divorce decree, they are just looking to see if it complies with the plan's provisions and it understandable. It is up to the attorneys, participant, alternate payee to ensure the DRO satisfies the provisions of the decree. If the DRO satisfies all of the PA's requirements, they tell both parties that the DRO is "Qualified" making it a QDRO. QDRO is then sent to the court for approval. (I am just speaking in generalities, sometimes the court approval is requested before the PA's review, but that doesn't change the fact that the PA is the one who makes it a "Qualified" DRO.) Does Ford GRP go ahead automatically and enforces QDRO for pension per the divorce decree, or do they have to have a QDRO paper filed? Ford is only obligated to enforce a QDRO. If no QDRO, then no action. If Ford knows that a DRO is forthcoming, or maybe forthcoming, they can hold a portion of your benefit until they either have a DRO to review, or a limited amount of time has passed. They should have "QDRO Procedures" that specify their rules, but generally, they notify both the participant and the AP that they have received a request for payment, they understand a DRO might be forthcoming, they will escrow an estimate of the APs benefits for some period of time (usually 180 days). If no DRO is received within that time period, they will release the escrowed payments to the participant. Can she go ahead and file for a QDRO now after 20 years? yes If the plan admin has a QDRO on file, shouldn't I, been noticed about it? Yes. You can always request to see a copy of it. If one exists, you, or your attorney, signed it.

Put yourself in her position, would you accept your offer? You would need to give your ex-wife something of higher value in order for her to forfeit something she already has. Not sure why either of you would be willing to do that. Your ex-wife is only entitled to the survivor benefits on the value of benefits you earned during your marriage. Your current wife is eligible for the survivor benefit you earned outside of the first marriage. Not saying it isn't possible, but I have never seen anyone change a QDRO after it has been accepted.

Agree w/ CB, but just clarifying that for 415 purposes the controlled group rule is "more than 50%", so I agree that the ownership doesn't look like an issue.

Usually published here: https://www.irs.gov/retirement-plans/minimum-present-value-segment-rates, but not sure why Feb rates aren't there yet? Feb is here: https://www.irs.gov/pub/irs-drop/n-25-17.pdf

Very common strategy. Just make sure you do it before anyone earns a benefit and make sure you get the 204(h) notices out on time.

Are you the participant or the Alternate Payee? I assume you are the Alternate Payee? If so, the Plan Administrator will not pay you without a valid QDRO. If the QDRO was originally rejected and never corrected, then the plan has no authority to pay anything to you. The Plan Administrator is not bound by the divorce decree. There must be a QDRO in order for them to separate the participant's benefit. Generally a plan will have QDRO Procedures that determine what happens in this situation. My experience is they will give the AP a certain amount of time to produce a valid QDRO (like 180 days), if nothing is provided, they will just go ahead and pay the participant the entire benefit. That said, it sounds like the participant isn't requesting anything at this time, so likely nothing will happen until then. Short answer, you will need to retain a lawyer to draft a DRO, which you then submit to the Plan Administrator for approval, making it a QDRO. A life annuity of $140/month starting at 65 is worth about $20,000 based on standard life expectancy. Your call if that is worth the cost to hire a lawyer.

So then what, are you asking about how much of the distribution was really eligible for rollover? Does the plan permit partial distributions? Someone, other than the broker, would have needed to authorize the distribution.

You (or we) are missing something. Is "he" the participant? What "remaining benefits" are you referring to? (Is this a divorce/QDRO question?) "Value" from whose perspective? To answer your question directly, there s/b a relative value disclosure with the election form. That said, typically, the QPSA and QOSA are relatively equal in value from the participant's perspective. However, from the spouses perspective, 75% of something is obviously a bigger number than 50% of something, even though those somethings are slightly different.

I am not positive, but I think for a cash balance plan you use the retirement benefit, except in the year of a full distribution. For that year of a full distribution, you can use the account balance method. Is there a reason why she hasn't receive a full distribution? She could roll into her IRA. I think once it is in her IRA, the RMD's would be based on her age. I don't know if a death benefit in a qualified plan is the same as an inherited IRA. Either way, the answers to the RMD question should be in the plan document.