QDROphile

That should be fun if she is still employed by the same employer, considering that it is likely to be impossible for her to get the money from the 401(k) plan even if she wanted to do so.

Substitute vesting for contribution in Janet M's post.

Kevin C: Can you identify the guidance about the leeway to change and number of months. That guidance would be very helpful.

The agreement has been amended to operate in good faith compliance with 409A. Evidently no one knows what that amendment is at the moment, but be sure to comply with it. I would bet it is the same as the amendment that applies, and will be documented, for any other benefits payable on death under similar arrangements.

I think the question was an existential question. Are we free? Oops. Wrong existential question. Is there any way to show that the amendment ever existed anywhere at any time by producing a copy (not even the original) now? If some amendment document can be produced from some source, then you can start telling a story about how this plan was actually amended by it. Without the doucment, you move from the existential realm to the metaphysical. But why do you need an amendment document? Plan terms don't have to be documented until the end of this year. Until then, you can amend in your mind and operate in good fatih compliance.

So the fact that the ESOP regulations expressly warn about section 415 violations has no meaning? If I were the jack booted thugs in the IRS I would apply my boot to a certain part of the anatomy of the employer that flouted the warning and designed an ESOP/ESOP loan that continually violated the section 415 limits. Translation of the regulation: don't be a big when you size the loan. If circumsntances have changed, such as a decline in the employee population, one plan or the other needs to take measures to avoid the violation. That may mean limits on elective deferrals.

You want thoughts? Your original post shows clearly what is wrong with the idea of a mid year rate increase applied prospectively, even forgetting about the compliance issues. It is unfair and it it departs from what a match is all about. If the employer wants to make up for the loss of the db benefit, spread the mitigation around the same group that suffered the loss. Don't mitigate by a match that is really a mismatch in the larger sense.

The ESOP can be a money purchase plan, so you can get around the question if can't find authority for another option.

Benefits are accrued under the MPP. Benefits cannot be cut back. There may be authority out there that says getting "just as good as" benefits is not a cut back, or that providing the same result as a contribution to the MPP with a subsequent merger of the MPP in to a new plan is not a cut back. Absent that authority, I would not advocate failure to make a contribution to the MPP under which the benefit accrued. Amending an MMP into a profit sharing plan was merging the MMP into the profit sharing plan. The MPP terms with respect to the benefits accrued survived the merger, and the contribution was to the MPP plan in that respect. Hence my suggestion to amend the MPP into the ESOP that the employer wants going forward. The ESOP could be a combination MPP and stock bonus plan, so the question about stiffing the MPP is avoided.

I was not suggesting that the pre-2008 MPP be converted to an ESOP.

I would love to see the authority for making a contribution to another type of plan instead of a contribution that was required under a MPP. I thought that is what 204(h) is all about.

Amend the MPP to make it into the ESOP so the contribution for 2008 goes to the ESOP. Sounds like this employer will have a rough ride with an ESOP.

The plan administrator takes the QDRO under the current circumstances and applies it as well is it can, or determines that the order is not qualified if the terms cannot reasonably be applied to the benefit as it is now -- in pay status. I would not make any effort to apply the order other than propectively to payments yet to be made. Other than that, it is all a matter of judgment and interpretation, and within the authority of the plan administrator. The determination of qualification (if qualified) should describe the application of the QDRO terms and efect on each person. If the individuals object, then the dispute need to be resolved in an appropriate way, which might mean that a determination of qualification is reversed. Meanwhile, since the plan has received a domestic relations order, payments should be suspended to the extent required by law to preserve benefits that may be subject to a QDRO.

Access fees are still not eligible for FSA payment.

Rev. Rul. 2002-27. The post did not give a lot of details, so the warning must be evaluated depending on circumstances.

Qualifed retirement plans may need terms to deal with "deemed" cafeteria plans and effect on compensation.

If the employee pays the premium and there is no reimbursement, the employer is not involved in any way, so it cannot be a group health plan. If the premium is paid through after-tax payroll deduction, I would argue that the payment arrangement is just a courtesy to the employee -- the employer still makes no decison regarding health benefits. But if the employer is involved in funding, including thorugh a cafeteria plan, other decision making, it is easy to fall into the HIPAA definition. If the employer will only pay after-tax payroll deductions to certain insurance companies, I would wonder.

How do you characterize the individual polices for HIPAA purposes? Try this description: The employer has a health plan. Under the plan any employee who wants health coverage must find an individual policy with the desired coverage. The employer will pay the premium, either directly, or indirectly by reimbursement to the employee after the employee pays the premium. Is that a group health plan? The HIPAA definition seems to cover it. The variations on the coverages are not relevant to the HIPAA definition. The cafetria plan as a delivery device is not relevant. The cafeteria plan is just a tax trick affecting the individual.

A plan can't have that provision, at least as applied to parties in interest who are not employees.

Here is a hint for your futher inquiry. No matter how you come out on the issue, if you have not at least discussed HIPAA in connection with the arrangement, you have not adequately considered the consequences.

What does the plan say if a beneficiary dies? Alternate payees are more like beneficiaries than participants in many respects, including ERISA provisions that treat APs as beneficiaries. What do the written QDRO procedures say about the interest of the alternate payee and beneficiaries of alternate payees? What does the order say? Assuming that this is a defined contribution plan that allows alternate payees to designate beneficiaries, and assuming no answer from the other sources, the money would probably go to the estate of the alternate payee. You really should have a clear answer from the other sources. If not, you need to work on the documents.

I am curious about the wife.

Sorry if I missed something because I did not parse your question properly. No 403(b) arrangement should deliberately fail to comply with the 403(b) regulations, incluing the requirement for a plan document. ERISA has nothing to do with whether or not to comply with the tax regulations. The ERISA question is whether or not to try to find that line and walk it. My advice is not to bother.

See Treas. Reg. section 1.409A-1(a) (2)(viii). But some people should be rethinking what was permissible under pre-409A law in light of 409A even though 409A does not apply.

Prepare to spend too much time and too much money to achieve an uncertain result. I think you can buy into the DOL delusion without great fear of the DOL; it is just a lot of trouble to understand and comply with the so-called guidance. Sloppy compliance is probably even OK if the DOL has any sense of shame. The important question relates to trouble and liability when a participant finds some way to improve his or her lot under ERISA and the judge does not buy into the DOL delusion. One point of my previous answer is that ERISA status can be attained by formal actions as well as funding.