Effen

I don't know of any requirement to notify a non-vested terminated participant that they are not entitled to benefits. I also don't know of any statute of limitations on benefits disputes. It is probably good practice to notify them, but I don't think it is required for any reason. Also, make sure your document states that all non-vested participants are deemed to have been fully paid all benefits at their date of termination so the IRS can't argue they should become 100% vested if the plan terminated at some point in the future.

What kind of plan is it? DB or DC? Why did you think you were a church plan and what makes you now think you are not a church plan? Did anyone work with you on this determination? How many people are in the plan?

"He uses hours worked and compensation for entire year such that funding for the year is based on accruals required for the year" There was a time when people would do BOY valuations using EOY census data. The theory was/is that the "assumptions" just happened to match reality. The IRS has been fairly clear that this is not an acceptable method, however you still see some fighters left on the island who don't know the war is over. He could be doing it right as 2 cents points out, or he could be doing it "wrong" if he is really using EOY census data on a BOY valuation. You should just ask him why you can't get valuation results earlier and see what he says.

ditto

I have never seen a document that defines a valuation date - I am not even sure what it would mean or why you would do it, other than for top-heavy testing as 2 cents mentions. You just need to change your thinking. DB plans are not like DC plans. In your case the valuation is run as of the beginning of the year (BOY). Think of this like a "snap shot" date. Who is in the plan on that date gets included in the valuation. The actuary makes various assumptions about compensation changes, termination rates, mortality and determines the value of the benefits they think will be earned during the current year. The only thing that is generally "real" are the accrued benefits as of the valuation date (BOY). What really happens during the year creates gains/losses in the next valuation. If someone quits or is hired mid year, it does not impact the valuation. If you are using valuation software to produce benefit statements, you would produce the statements at the BOY based on real data from the prior year. Therefore, the person hired mid year just wouldn't get a statement until the next valuation date. It sounds like you might be having problem with the timing. If you aren't getting your BOY 13 valuations until mid 2014, then you either need to get the data to the actuary sooner, or you need an actuary who is more responsive. If the 13 BOY vals were done my mid 2013, would you still have the same concerns about the benefit statements? Doing EOY vals might help, but if timeliness is already a problem, they will just compound the problem by forcing a shorter window. Plus, they add complexities in other areas.

I don't think so, that is a significant problem with the program. They could consider terminating the plan and just not making the contribution. You would still report it as a deficiency, and they would owe a 10% excise tax, but that is much better than the entire amount. Then again, if you haven't terminated the plan yet, you probably owe a contribution for 2014 as well, which means another 10% for 2013, plus 10% for 2014. Once the plan has been terminated, I think the popular opinion is the excise tax clock stops running. There isn't much relief for small plans, charity or otherwise.

Deficiencies are not an "audit game" kind of thing. Since the SB was filed showing the deficiency, the IRS WILL send a letter asking followup questions. They generally don't ignore this kind of thing. Prepare the 5330 for them, tell them to file it and pay the excise tax. If they choose not to, at least it won't be your problem. Also, is this plan covered by the PBGC? If so, you also have a late reportable event with the PBGC to deal with as well.

I don't think so. You are correcting the reporting of a contribution that was timely deposited. They made a timely deposit, and properly deducted the contribution, but you just never put on the SB. You are now correcting that error. (Granted, they caused the error and you should charge them for the redo, but I don't see this as a problem.)

So the obvious question is, you currently don't guarantee your work?

I don't see any problem amending the filing, especially since they took the deduction.

Stolen from a similar post on the COPPA Board, but I thought it was appropriate: The IRS has made me remove the Circular 230 notice it formerly made me put here. Under penalty of law you may not rely on, and no inference may be drawn from, the fact that I have deleted the Circular 230 notice the IRS used to make me put here but has now told me not to put here. Further explanation of this notice of non-notice is available at my usual hourly rate. Personally, I never put it on anything in the first place because I thought it was stupid. But that is just the rebel in me, I guess. It is nice to know the rest of the professional world has come around and realized it.

Just an FYI, the pass ratios for EA 1 are very low, typically only about 20% or less pass. This is generally thought to reflect the quality of the student taking the exam, not the exam itself. Most "strong" students are going the ASA/FSA route and don't take EA1. The "weaker" students take EA 1 and therefore the pass marks are very low. Normally less than 100 students take the test each year. The material generally doesn't change much from year to year. Best approach is just get a bunch of old exams and make sure you know how to do all the questions. All the old exams and answer keys are available on the Joint Board site. Really no reason to buy the newest study material and solutions for EA1. You would probably be just a well off if you could find someones used stuff from a year or so ago and save yourself some money. The text books you mentioned are great, but practicing on old exams is the best way to go. Also, save the 2 or 3 most current exams and practice on them in simulated exam conditions. This will give you good insights on where you need help.

Definitely.

I think they are both ok, but don't forget about the other optional forms of payment. Some might be higher under the old assumptions and would need to be protected. As always, you should bounce this off the attorney, who should have the final say.

If your plan contains many optional forms of payment you are permitted to remove some of the options, if they are redundant or very similar to other options, but you can't just remove all J&S options from the plan. Remember, the J&S option is one of the basic provisions of any pension plan. You can't just eliminate it because a vendor thinks it is burdensome.

I don't think so, but others may offer different opinions. I believe because a MP is considered a "pension" plan, 411(d)(6) applies to all rights and features. You could spin the MP piece back out, then terminate the MP plan. Also, why would you have hired a vendor that couldn't handle this. Isn't that why you do vendor searches?

1. I would say yes, but you could have other settlements that will give you more than 2 pieces. 2. I would say yes - each subsequent lump sum will trigger a re-measurement which may change the discount rate. I think the answer to both questions is yes, which is why most people only do the settlement accounting once, at the end of the year. Doing a re-measurement after each lump may be technically correct, but an administrative pain.

Was this a separate interest or a shared interest QDRO? Your description seems to imply shared interest, and if so, I would lean towards the AP being SOL. However, if it was a separate interest, could you argue the benefit was converted to an annuity on the APs life and therefore the death of the participant would have no impact since 100% of the AB is now completely assigned to the AP? Just something to think about.

Forgive my possibly stupid question, but what advantage do you gain by investing a tax deferred trust in off shore accounts? Why are you considering this?

Are you surprised by the attention, or lack of attention? I am still using PPA Funding Target for 90% of my single employer plans and I still have never had an auditor ask me one question.

Coming back to an older question - if my plan allows for annual annuity payments, am I ok using annual annuity factors to determine the 415 limit? If my plan does not permit annual payments, do I have to use monthly factors? I think the answer to both is "yes", but I am hoping for confirmation.

Lots of information out there on this board. Just do a few searches and you should find plenty of advice. Here is just one that you might find helpful. http://benefitslink.com/boards/index.php?/topic/43751-defined-benefit-and-sep-ira/

I agree. All I want to see is the QDRO. If they send me additional information I make sure my transmittal letter explicitly states that I did not review any of it.

4) leave it alone and "fix" it next year. Why is this anything other than an assumption change? I don't really understand what you mean by you "hadn't accounted for 417(e) PVAB"? Under the PPA Regs the only thing you do in your funding target is use 417(e) mortality if the plan pays 417(e) lump sums, and that generally is not significantly different than the standard tables. I see plans all the time that we take over where the prior actuary was not recognizing the lump sum in the FT. I just "fix" it and move on. I don't think it rises to a level that I would tell the prior actuary that they had to restate a previous valuation. If you chose to redo the 2013 valuation, why not redo the 2012 also, or 2011, or 2010? I assume you weren't recognizing this in any past year, so why just fix 2013?

sorry, but I am even more confused: "The were separate interest. The 401K was split" - What was separate interest? The pension, or the 401(k), or both? "With both of us having having survivorships on each other pensions. If I pass before I commence she would recieve a porsion of my pension as would my sons. The same would go to me if she passes." This sort of makes sense, except the "as would my sons" part. If your ex is to be the beneficiary of your J&50% S annuity, I don't know how any would end up with your sons since you cannot have a contingent beneficiary. "So instead of taking a lump sum ( which are plan offers) I have to take a 50% annuity. The same goes for her." OK, this fits with your previous statement. "called fidelity, they told me she already recieved her portion of my pension, which I can see with my new numbers." Did she receive her portion of your pension (DB) or your 401(k)? If she really did receive her portion of your pension, I would agree that forcing you into a J&50 with her as beneficiary seems redundant. There may not be anything you can do about it, but I would agree with your frustration. Does she also receive a portion of your pension as a monthly annuity, or does she only receive a monthly benefit after your death?