Effen

Full circle! I guess what goes around, comes around.

Conference of Consulting Actuaries

The few that we have filed, sometimes we get a phone call, sometimes not. Consider it "no news is good news". What kind of response were you expecting?

A return call from the Joint Board? They will call you back. I have had very good luck. You can also email them. I had to check on someone last year and they emailed me back the same day.

Just to add to that, since you can never change assumptions on an amended Sch. B, Jim Holland said that if the new actuary was amending the prior actuaries Sch B (because the prior refused to do it or was dead), the new actuary must use the prior actuaries assumptions. If the new actuary was not comfortable signing a schedule B based on the prior actuaries assumptions, an unsigned sch B c/b submitted with an attachment describing the situation. Maybe think of this as a large footnote to the sch B the new actuary will be signing - I said this, not Jim.

Yes, I believe that was what was being asked. I guess I wasn't expecting a "maybe". I always thought it was fairly clear. Problem was, it was the last question of the session and people were getting restless so there was no ability to follow-up.

FYI, Jim Holland said at the 2006 EA meeting that they sent 575 "Howdy" letters to 412(i) sponsors and they are currently examining about 200 cases. He didn't have anything else to report at this time since it is still ongoing.

There is a Rose Bowl joke here somewhere, but I just can't point my finger on it.

Just an FYI, the following question was raised at the "Dialogue with Treasury and IRS" session: If an employer contributes to a DB plan for participants who also have an account balance in a DC does the 25% limit come into play or do they actually need to receive an annual addition in the DC plan during the current year. Harlan Weller answered "that is a fairly messy topic and we have no answer at this time" I find his none answer very enlightening. I guess I will need to tread a little lighter with my advice to clients.

Really? Actually, I thought every actuary was listed on that site. I am not an SOA member, but I am listed, but not as Effen. I would be surprised if an EA is not in that data base, they are all suppose to be there. I would be interested to know if they were an EA, but not listed in the SOA's list.

The SOA maintains a list of all enrolled actuaries. Enrolled Actuary directory

I always thought that was Rosanne Rosanna Danna?

I agree, the "100K" rule only applies to EZ filers. Did you check to see if a PBGC filing is also necessary?

Can you be more specific with your question? What is the actual situation you need help with? DB or DC? Mulitemployer plans are exempt from some of the 415 limits.

I would add a "term cost" to the normal cost. This should be the cost of the insurance, like a term charge. It is the portion of the premium that is actually used to cover the death benefit for the current year. Kind of like an expense assumption. Ultimately the premiums are always "paid" from the trust. If the company pays them directly, the premium payments is treated as a contribution. So it's like they deposited it into the trust and then paid the premium on the same day. Net effect is 0 to the Trust.

When did the IRS start hiring pirates? I think this equal opportunity stuff has gone too far. Can't you guys get a job doing Capital One commercials?

I agree. I don't think the 404(a)(7) limit comes into play unless they are deducting contributions to both a db and dc plan during the same year. Just having a dc plan doesn't trigger the restriction. I think the full 200K would be deductible. That said, if you search the board you will find some long threads discussing this. Ultimately, it's the accountants/clients call.

Pax, why are you saying the max ded. is $150,000? If they are not making a PS contribution, I don't see why 404(a)(7) would even be an issue, unless you believe just having the PS plan makes 404(a)(7) kick in.

A self employed doctor owns a C-corp. that sells software. The doctor practices as a self-employed physician, but also takes some compensation from the software business. The doctor maintains a db plan that covers his income from self employment and his income from the c-corp. All employees of both entities are covered. There are 4 other employees, all working for the C-corp. The C-corp. by itself is not a professional services employer. Do you think they are exempt from PBGC coverage because the physician owns the C-corp? What if most of the income came from the physician practice? "A professional service employer is any entity owned or controlled by professional individuals where both the entity and the professionals controlling it are engaged in the performance of the same professional service" Since the C-corp doesn't perform the same service, I think I'm sunk, but I wondered if anyone else had another opinion.

Lots of prior threads on this topic that you should probably read. My personal opinion is that anyone who has not had a break s/b 100% vested. Some people argue 5 breaks, some say only those who were actually active at the time the plan terminated. If you submit for approval, the IRS will probably ask about anyone who termed during the last 5 years so be ready to defend what ever your client chooses to do.

What is the issue? Did the policies lapse due to lack of payment? What does the Plan document say related to the death benefit? Often the death benefit is defined in the plan document as a specifc amount. The Plan owes this benefit regardless of the plan's choice to insure it. Therefore, if the premium is unpaid, it may not have any impact on the benefit which the participant is entitled.

I think prospectively the plan should be amended to exclude him. The concept of a waiver implies he has a choice and that could lead the IRS into a CODA argument. I think the better way is to exclude him prospectively by amendment. Also, I would be concerned if he is waiving benefits he has already accrued. Does he want to waive his '05 allocation? If so, I'm not sure this would be permitted since Funding Standards apply to MP Plans. Therefore, he would be forfeiting a benefit in order to avoid a required contribution which I don't think is permitted. (That is a DB rule, but it may apply to MP plans as well.)

This is clearly a legal issue and should be handled by the Fund's ERISA counsel.

Great article, although I had a little trouble avoiding sweetmonkey.

The problem with some exams, especially more basic ones, is that you can know too much. I think I would agree that "posting on workplace bulletin board" is probably an incorrect response.