Effen

You could always come to Pittsburgh - we are on the brink of having the worst road record IN BASEBALL HISTORY! Like my daddy always said, if you are going down, go down in with style. Regarding the "catholic" bear, I assumed you were using the word for it's actual meaning, to which I ask, is the bear catholic what? Is the bear catholic in agreement that he is smarter? Does the bear catholic care if Yogi was a catholic?

I heard Holland say many times the final AFTAP needs to match the SB, so I truncate in both places ... sometimes even using my real name.

Seems like you answered your own question - SB instructions say truncate. We're truncating like good little children.

May or may not be true depending on the 2008 ratio. I believe our esteemed congress gave one more year's "relief" on that provision.

I would say file without the audit. The return may get bounced for not having the audit report, but hopefully by then the audit will be done.

Thank you both. I think Bird makes a good point. Since the plan has excess assets, there is a potential reversion to the corporation and therefore it has some value, so it is hard to argue the stock is completly worthless. We'll probably prepare the full 5500, even though the Schedule I will show $0 for non-exempt assets.

No, it has a sponsor. The company still exists, but in name only. Lets say XYZ corp manufactures soap and sponsors a plan. At some point the sole owner of XYZ corp sells all of the assets used to make to soap to Zest, Inc. XYZ corp. still exists, but after all the bills are paid, all they have left is the plan. The owner of XYZ still maintains the plan, and the plan still holds some shares of XYZ corp in the trust. However, XYZ corp isn't worth anything because at this point, it is just a corporation whose sole asset is the plan. The plan is very overfunded, but the owner is content to sail around the world and doesn't care much about the plan and doesn't need the money, so it just sits, and we continue on with a plan full of vested terms and retirees. So, do the worthless XYZ corp shares preclude me from preparing an SF?

I have a plan where the plan sponsor went through an asset sale a number of years ago. The plan has been frozen forever and is significantly overfunded. The corporation that sponsors the plan doesn't really exist anymore, yet the plan still holds shares of the company. The auditor has determined the value of these company shares to be $0. Company stock would clearly be a non-eligible asset and therefore preclude the sponsor from filing a 5500-SF, however, the sares have no value. Since they have no value, do you think they would be permitted to file the SF?

They can both be right, however all you need to do is amend the plan to allow for a lump sum option (along with an immediate annuity) upon plan termination.

Why would Shirely know where Mike's stuff is? (Sorry, just couldn't resist. OK, back to AFTAP's and SBs)

I know Charlie is still in business. Maybe you should just call him directly.

If a client elects funding relief under PRA10 for 2009, do you think that should be marked as a method change in the SB? I think not, but I'm trying to figure out how to alert the IRS that they took the relief. I will designate it on an attachment where I illustrate the amortization bases, but I'm wondering if I should do something more? This client made a formal election to accept the relief.

http://benefitslink.com/boards/index.php?s...arterly+penalty

401(a)(17) always applied to the benefit formula, but not always to the 415(b) limits. It really only mattered if the person's NRD was later than 68 or 69 when the 415(b)(1)(A) limit would exceed the 401(a)(17) limit. In the past, as long as your actual comp was > 415(b)(1)(A) limit, you could have the (1)(A) benefit. Then the IRS came up with Regs that said your 415(b) limit could never exceed the 401(a)(17) limit, effectively cutting the maximum benefit for older participants. I don't recall all the sites and dates, but this change was fairly recent...maybe last 5 years or so?? So, keep in mind that the most comp you could have ever used for benefit purposes was the 401(a)(17) limit of that particular year and therefore this person's average compensation for benefit accrual purposes would be based on the average of the limits in effect during those years. That said, if the benefit formula permitted him to accrue a benefit greater than the 401(a)(17) limit, he could have had it, assuming his less than his actual comp and the 415(b)(1)(A) limit.

I think there are situations where you could have a 2nd annuity starting date, for example if the benefit is split due to PPA benefit restrictions, but generally once someone makes their election, based on the available options, they don't get a second bite at the apple. If the plan offered a new payment form, generally it would not be offered to those who already elected a different form of payment. If you gave them a 2nd bite, it would lead to adverse selection issues. Maybe if you gave an example of your concern, you might get more responses.

Since the particpants know how much of their package goes into the pension plan, they often consider that to be their contribution, which in a way it is, but it is treated as employer dollars.

Sorry Andy, but I think I'm going with SoCal on issue Q2. Mabye I will just look at all of the guidance we have so I can know for sure....oh ya, we have none.

It is possible, and I have seen it in some documents, but I wouldn't call it common. I would read the provisions very carefully. Often a "year of service" has a different definition for eligibility, vesting, and benefit accrual. It is fairly typical that you double count eligibility service, but not so for vesting and accrual. Typically vesting and accrual service is measured only on the plan year and not the employment year.

And what is the death benefit?

Previously, in the old SAR days, we would include a statement on the SAR explaining that the employer missed a quarterly contribution and provide them with all of the required information. Since the SAR was done with the 5500 for the year in question, most people considered this timely notification. Now that AFN's are due 4 months after the first day of the year, before the employer may have completed the required deposits, do you think it would be ok to wait until the following AFN to report the late quarterlies? For example, can I report missed quarterlies for 2009 on the 2010 AFN which is distributed in April of 2011 or would the client need to do a stand alone notice? If you think it needs to be a stand alone notice, when would you send it?

I would make sure they receive all of the proper notices related to the PBGC termination and make sure they get the benefit they are entitled to. "woodwork" people surface all the time in bigger plans. I don't think USX is redoing Schedule Bs everytime they find a previouly unknown participant. We have had the PBGC discover missing people on audit of a plan termination. All they request is that the missed participants receive what they are entitled to.

The final 430 Regs probably contain your answer. Do you have a specific question?

You can use compensation, or compensation times service, or service, or age, or job class, or whatever, as long as the allocation complies with the applicable non-discrimination rules AND is provided by the plan document. Since you are excluding some employees, whatever you choose may need to be general tested.

Generally, the allocation of the excess assets is treated as a benefit accrual (or increase) that needs to comply with the applicable non-discrimination rules. Therefore, you don't necessarily need to include everyone, but you need to include enough to pass 410(b) & 401(a)(4).

Andy, did they actually recover any money? How are they able to change the premium filing method once the form has been filed?