QDROphile

Perhaps incorporation breaks what you perceive to be continuity of existence.

Not the dumbest question ever, but maybe this is a prompt for a contest ... .

If you had a lawyer when you won your case, the lawyer should have evaluated whether or not a claim for lawyers fees was viable.

Your expectation of the deadline for payment was incorrect. In addition to the maximum time allowed by law (not your tax day, in any case), the plan generally can set a shorter deadline for default and deemed distribution. Note that I am oblivious to any effect of the CARES Act. You now have basis in the amount of the balance you paid. That is some consolation.

Depending on where you are, the Clerk of Court’s office might be helpful and accommodating with procedures for filing and approval of uncontested documents. However, substantive matters are usually beyond the scope of such help, and amending a prior domestic relations order is likely to involve substantive issues. In other words, they might help you with the filing procedures but not what goes in the documents or whether the proposed terms are permitted under state domestic relations law.

Some plans handle disputes about qualification through the plan’s claims procedures. At one point, the DOL took the position that the issue was not a matter for claims procedures. I do not know if the position has changed. Claims procedures are either described in the summary plan description or summarized in the summary plan description, with a full claims procedure document available upon request. You make your case by submitting a claim for benefits, explaining the error made by the plan and the legal authority for the outcome you desire. The plan is required to assess and respond, with an explanation of its position. The exercise often forces plans to get religion, or at least competent advice about its position.

QDRO administration tends to be mediocre at best and can be really terrible. The Department of Labor suffers from its own misunderstanding of the law in several respects, and passes it along. Another explanation is that the administrator anticipates problems on the distribution side, because an SSN is required then. Difficulty in making distributions terrorizes administrators. By addressing it at this stage, the administrator at least has you as a lever.

An SSN is not a qualification requirement. A plan may require an SSN for disbursement, but not for qualification.

You might be concerned with something that is usually overlooked, including by the IRS and DOL. Loans have to have commercially reasonable terms. At least some commercial loans are regulated and are required to allow prepayment of some sort. In the environment, I would venture that it is very common, if not universal to allow prepayment, although the specific terms probably vary, e.g. there may be a permissible prepayment penalty under some loans to protect the expected profit of the lender. It may be commercially unreasonable to deny prepayment altogether, and it may be unreasonable to have prepayment penalties for plan loans. Denying partial prepayment is common, as an administrative burden, and should be allowed.

To be overly simple as a starter, what is the business of the management group that allows it to maintain a plan for its employees/members? Then look at the relationships to see if there are complications and limitations.

To avoid plan disqualification, the employer is responsible for correction of the missed deferrals, and related match, if any, in accordance with IRS guidance. As to the ultimate responsibility for the cost of correction, I suppose the employer/plan sponsor can argue with the administrative services provider.

Not enough facts, although the answer is likely not to be absolute, no matter what the facts are because it is messy. The missing facts relate to what the plan procedures are for changing deferral elections, how well those procedures were communicated generally, whether or not participants were required to follow the procedures strictly while others stayed in their lanes. Your presentation implies that employee communication to employer is not the appropriate procedure for changing deferral elections, and that the employer did not follow or refer the employee to appropriate procedures

Now that I know that the employer is quasi imaginary, my fundamental question is quasi academic: What is the employer trying to do? Most employers would like to encourage retirement savings, but many are chary about involvement (e.g. potential liability) and expense (including indirect expense of administrative burden). Your hypothetical has elements of these concerns. I start from the easiest option that allows the employer to exhort employees to save within the IRA limits and make it automatic, without getting involved further in evaluations, payroll deduction IRAs (not state sponsored) : https://www.irs.gov/retirement-plans/choosing-a-retirement-plan-payroll-deduction-ira#:~:text=Under a Payroll Deduction IRA,deduction to the financial institution. If the employer wants to get more involved by trying to get a better or best solution (e.g. better investment options (whatever that means) or least cost maintenance), then it gets complicated. I think the "What are you trying to do or avoid (e.g. potential liability for investment decisions, at the high end)" question is primary and there is no pat answer. Pat answer: As between your choices, the state run IRA involves the employer the least and is beyond reproach, except that may not be the best benefit for the employees or owner. Better just to allow payroll deduction and let everyone fend for themselves if one is involvement averse.

Is the 100 (or less) basis points inclusive, or on top of, the investment fund management expenses? Is the employer willing to work on or pay for analysis of least cost options? What is the workforce like (especially with respect to sophistication, generally, not specifically with respect to investment decisions)? Does the employer wish to allow (passively) or promote (actively) the idea of retirement savings? You used the term "allow" but nothing is preventing folks now from saving through personal IRAs within the scope described, which is one reason for the questions.

Also, the plan may have a formula for providing installments and might not allow whatever schedule you would devise.

It depends on what the order says. 50% of the pension can be written several different ways with vastly different outcomes.

This is an interpretation question. It may well involve corporate law, e.g., is ministry B the legal corporate successor to ministry A? That might provide a satisfactory answer. It might not. I would start there, because it is conventional.

Particular Investment options are not a protected right under ERISA, FWIW.

Just to be picky, I think the applicable term should be "red herring" rather than "smokescreen". A smokescreeen is a deliberate action/phenomenon, designed to conceal or deceive. Some definitions of "red herring" involve deliberate action, but the nuance is that a red herring is a distraction from the subject (leading to misconception) rather than a concealment (misleading to misconception).

Are you reporting that Lincoln does not have a financial product that can be purchased for an IRA investment that approaches the desired Lincoln 403(b) investment option? Am I incorrect in inferring that the desired investment option in the Lincoln-administered 403(b) plan is a Lincoln product?

Does Lincoln have a product you like for an IRA? Is there a reason to keep funds in a 403(b) plan?

A plan is not required to accept rollovers even if the law allows it.

Notwithstanding my respect for your position, which has great merit, I think amending unfortunately drafted QDRO procedures (“hold” on notice of domestic relations proceeding - not a DRO) after the notice is going to be messy if the would-be alternate payee chooses to fight (because the law is not as solid as you imply or state, especially with messy facts and an incorrect DOL position). What saves a lot of bad QDRO advice/documentation/administration is that the stakes are not high enough, or the players are not rich enough to fund the fight. At a minimum, the dispute, including following claims procedures and possibly court appeal or DOL intervention will involve a lot of delay, which is troublesome for a terminating plan. So, the better approach is: 1) not to have bad QQDRO procedures and practices, and 2) don’t go looking for trouble in a misguided attempt to protect the innocent.

Peter, none of your text is ever “normal “. I mean that in a good way.

I don't quite get your point about section 402, but I do remember that the discussion in first-year contracts class about unilateral contracts was unsettling. Pursuing that line would not be helpful in this forum.