QDROphile

Depends on what the plan says. Probably not, based on the specification of the annuity providers, but it is worth asking or checking.

Keep in mind that most corporations cannot be trustees. Also keep in mind that whoever the fiduciaries may be, they have to keep their corporate and fiduciary roles straight and may have very serious conflicts in various circumstances. If the labels overlap, the concepts may be had to keep separate. Finally, it is never a good idea to name the sponsor as the plan administrator or other fiduciary.

The plan administrator is asking for trouble by digging. The divorce decree is a domestic relations order, too. What are you going to do with inconsistent provisions? Are you going to ask for all documents that might be a domestic relations order, or just the divorce decree? Are you going to ask for other information that is not in court documents? Where do you stop and what are you going to do with all that dirt? You started on exactly the right track -- a participant cannot be an alternate payee with respect to the participant's benefits. Is is for someone else to overcome your negative determination by clarification or additional information or orders. Don't try to do the work for that person.

If the order is designed to provide for child support, I would insist that it name the child as alternate payee, but expressly provide for delivery to the participant as custodial parent. This is an unlikely arrangement under state law, but that is not for the plan administrator to decide. I suspect an improper attempt at distribution to the participant. So what is this about asking for a copy of an order that you have already received?

There is a requirement that one-time elections be made "at the time of initial eligiblity to participate in the agreement." IRC 402(g)(3). The IRS has refused to rule that a one-time election that is made after a participant is eligible for "regular" deferral elections is a separate "agreement." You are on thin ice (or perhaps all wet) if the one time election can be made later than the first salary reduction election is available.

So who is the trustee that violated ERISA by discretionary investment of all money under its control in company stock? The nature of your questions and the situation you describe suggest that you need the help of another "benefitpro" and should not rely on responses from bulletin boards for how to proceed.

You are asking for trouble if you get involved with how or why the individuals are choosing how to divide benefits. As far as a plan is concerned, there is no right answer and the only thing that matters is administrative ability to follow the instructions for division, satisfaction of the qualification requirements, and compliance with the plan's written QDRO procedures.

The plan document has to be drafted properly to preserve the right to withdraw pre-1987 after-tax contributions only. Chances are good that bad drafting precludes the separate withdrawal. You have somewhat better odds if the plan stopped taking after- tax amounts after 1986.

If you are going to forfeit, the plan document should have provisions providing for the forfeiture and what happens if the participant or other payee subsequently appears. You also have to determine if you have made reasonable efforts under the circumstances to locate the participant. A single mailing might not be sufficient, or it might.

Still not a bona fide termination. Also a fiduciary breach because the participant is robbing the plan of value, at the expense of other particpants. A fiduciary has to be careful about value robbery even with bona fide termination. If the drop in value is material, the distribution should be postponed or a special valuation should be performed. The plan should be designed to provide for the delay or special valuation so the fiduciary does not have to stretch plan terms (what does "adminstratively feasible" mean? I would be tempted to read fairness into feasibility if the drop invalue were material). The more infrequent the valuation date, the more important it is to have safeguards.

If the plan document does not clearly cover the situation, the document must be interpreted. The person with authority to interpret the document should decide. Are you that person? In a well drafted document, the person with authority to interpret will be identified, and is usually the plan administrator or other fiduciary.

Be careful to distinguish what the law allows by way of a change and what the plan allows. Plan terms are not required to go to the full extent of what the law allows. The plan might not allow the mid-year enrollment based on the change in work schedule.

Reversing the order you asked: 1. Allocate all fiduciary duties away from the employer to the persons who will be responsible for the functions. Those persons will either be employees or third parties, exactly the same as if the employer were the misnamed fiduciary. No extra cost because the same persons are performing the same functions. 2. It is a mistake to have the employer in the position because naming the "employer" tells you nothing about what person is responsible. Corporations act through many persons, and the directors and officers of a corportion are responsible for what a corporation does. If the fiduciary is not more precisely identified, any of the agents could be liable for fiduciary responsibilities, even if they were unconscious about their theoretical responsibilities. To put this in more practical terms, if the employer is a named fiduciary and someone sues for breach of fiduciary duty, each officer and director will be named individually as a defendant. I am not saying that each will be liable, but the corporation will want to avoid the embarrassment and the expense and struggle to dismiss the action against the wrong bodies. Plaintiffs will have too much leverage. It is much better to name the persons who have the functions. They will know that they have the responsibility and they will answer if a claim arises. Everyone else should be left alone, and if not, will have an easier time with extrication. We have stomped all over plaintiffs who try to sue and fail to name the fiduciaries when the fiduciaries are precisely identified in plan documents and records. Persons who do not have the responsibility will not have to worry and will be less likely to interfere with or waste time on matters that are not theirs.

Appointing a fiduciary is a fiduciary function, but either (i) the employer does not have to name any fiduciary, or (2) if you believe that adoption of a plan document that names a fiduciary (or the fiduciary who names fiduciaries) is a fiduciary function, it is at least a very limited fiduciary function and is materially better than having a more general fiduciary status. I won't get into a discussion about Varity. The point is that the employer should not be set up to be a fiduciary, as happens with many plans because of bad plan documents or lack of thought.

By naming fiduciaries that are not the employer and allocating the fiduciary functions appropriately among those fiduciaires. What is it about being an employer that makes you think an employer is a fiduciary? Most employers are fiduciaries because they have plan documents that name them as the plan administrator.

It is a mistake to make the employer a fiduciary.

And even if the NHCE percentage is less than 20% I don't think it works because the exception only applies to the leased employee rules and does not address the other contolled group rules that would aggregate at least all of the 100% owned businesses. In your situation, the leasing organization is 100% owned, too. Pretty transparent device. Not effective.

There is a reason for having provisions about leased employees in section 414(n) of the Internal Revenue Code. Section 414(n) is followed by section 414(o). If you like puzzles and can break the code, the answer is: 414(n), 414(o), which reduces to (n),(o), which further reduces to "no."

It is a mattter of interpretation or policy whether or not a plan will allow proceeds from a second loan to repay the first loan under a "one loan" restriction in the plan. Nothing compels the plan administrator to allow it. As noted above, there are compliance issues if the plan administrator does allow it.

You have a deemed distribution if any loan payment is more than 180 days overdue (and probably before that). Under the circumstances the probability of a prohibited transaction or a disguised distribution seems very high. You need help from someone who knows how to deal with this stuff. The issues get fuzzy and the consequences are complex.

Depends on: 1. Whether or not the plan has an assigment of pay. 2. Whether or not the payroll deduction authorization is irrevocable. 3. State law concerning payroll deductions (the pre-emption of state law is the subject of some debate). 4. What the plan and loan documents say. The plan administrator cannot simply let the participant off the hook because of unpleasant circumstances, nor can the plan administrator walk away from easy collection of loan payments. If the participant does not have the right to cancel payroll deductions, the administrator can't let them be cancelled simply because the participant would like it. The loan must be enforced. The plan administrator can decide whether or not extraordinary collection efforts are warranted under the circumstances if the particpant is able to cut off the easy money because of a right to cancel the payroll deductions.

It is also common not to allow distributions until 5 years after termination of employment unless you retire or die. IRC 409(o). This is actually a good rule, because otherwise the ESOP could string you out until you are 65.

Why don't you ask to have the learned legal counsel brief the plan on the proposal?

Other threads have addressed these questions. An alternate payee may roll to a qualified plan if otherwise eligible, including the plan that makes the distribution under the QDRO. Plans are not required to accept rollovers. Amounts rolled over remain rollover amounts subject to any special rules of the plan applicable to rollovers. The applicable regulation is ambiguous, but the the IRS model rollover notice is not.

And what fiduciary of sound mind would exchange liquid diversifed investments straight across for company stock, especially in a privately held company? This is an extemely sensitive proposition and I know many expert professionals who will have none of it.