QDROphile

One aspect of what Mr. Preston is saying is that a revision to a property settlement in a divorce is first a matter of state domestic relations law that must be addressed before anything "QDRO" is considered.

Monetary damages are rare under ERISA. The usual remedy is to put participants in the position that they should have been absent a violation. In technical terms, ERISA looks to equitable remedies rather than legal remedies (damages).

However it is accomplished, it must be remembered that the benefit is the participant's benefit to which the beneficiary is entitled. It makes a difference and it makes a difference if the beneficiary is the spouse or someone else.

Was there supposed to a distribution? Was there a sloppy use of the term "transfer" to mean that the plan will now recognize the beneficiary as controlling the benefit, including determination of timing of distribution? Plan terms will dictate when distributions to beneficiaries must occur. Do not presume immediate distribution. I venture that it is common allow spouse beneficiaries to maintain the account of the participant subject to the limits of the required distribution rules.

No early distribution tax on distributions pursuant to QDRO. The AP is trying to receive a distribution in a form that appears to be unavailable under the plan, although the original poster has not provided adequate information about plan terms; this is all about plan terms.

Subject to a reading and understanding of all the plan terms, it would be reasonable to interpret the plan to allow a disclaimer. I venture that few plan administrators are both capable and familiar enough with plan terms to make a solid determination. I also doubt that it is a high risk proposition.

Class warrior; can't be helped. I am not always successful in getting the optimal result, but I have had the privilege of working mostly with enlightened and caring clients. I also recommend against plan loans, but I get the proposition that people will be more likely to save if they think the funds do not become totally inaccessible in the short run.

The original employee benefit provided for loans and the employees relied on it for life planning. The loans could have been preserved and operated as intended after the corporate transaction, but the employers did not think enough of the affected employees to go out of the way to avoid the adverse effects of pulling the rug out. Just because a lot of employers do the wrong thing does not make it any less insulting. Both the former and current employers are at fault., and the affected employees ought to know where they stand in the eyes of the new employer. Mostly they are ignorant and do not realize the the new employer made a choice that affected them adversely and "LOTS of employers" rely on the ignorance to duck the criticism they richly deserve. And we can agree to disagree, but it would be best to take positions based on full knowledge by all involved.

One thing can be determined for sure. You got screwed by your former employer and your new employer. You should have been allowed to roll over the loans and maintain them in accordance with the original expectations . It was not a legal right, but it could have been provided for by your employers who did not give you much consideration. They just did not want the bother. Spread the word among the transferred employees. Anyone with a loan got the shaft the same way you did.

The statutes say that, in order to be qualified, a domestic relations order must state the mailing address of the alternate payee, NOT the last known mailing address of the alternate payee (as commonly misapprehended, including by that QDRO-incompetent organization, the Department of Labor). If the statutes say that the mailing address must be stated in the order, I think a good argument can be made the overlooking the terms of the order and using some other address available to the plan (a "last-known address"?) is unreasonable. The plan administrator is also charged with administering a QDRO in accordance with its terms. I am not arguing that the delay discussed in this thread is cause for liability.

First tell us what practical effect the delay had for the AP, other than the formal ability to request benefits two week earlier. Practical effects of a delay in application for benefits might count. Absent unusual circumstances, a two week delay in proper delivery has no legal effect. No alternate payee can ever get payment fast enough.

A#1: There is nothing you can do about it except to understand what the QDRO provides and make sure it is administered correctly so you receive the correct benefits for a subsequent spouse of a participant subject to the QDRO. A#2: You can can talk your spouse into having the QDRO modified, which is unlikely to be entertained by the court. See A#1.

I think your second sentence is operative. It is a matter of interpreting the plan because operation of the plan, such as beneficiary designation and consent by a spouse to the designation of a different beneficiary, must be consistent with plan terms. It would be OK for a plan to provide that no post-mortem consent is allowed I would not describe plan interpretation as exercise of discretion on a consistent basis, but we need not take up that point,

20 years of consistent approval by the IRS of real volume submitter documents and custom documents. I did not go back to the original source that gave rise to the proposed terms for submission to the IRS

Question 1: A designated or default spouse beneficiary can consent post-mortem to the pre-death designation of a different beneficiary. The designations and the consents must be in accordance with plan terms and procedures. That means that post-mortem consents are dicey without an express plan provision or at least a formal written procedure. It pays to have smart plan documents, which precludes most pre-approved plan documents. And now custom documents are problematic because the determination letter program has been closed and the general competence of IRS personnel has declined.

So do you buy into the DOL sop generally, and it is business as usual after the 403(b) tax regs in determining whether or not a 403(b) plan is subject to ERISA?

While I agree with the conclusion, do you distinguish payment of settlor expenses, such as establishment of the plan and adoption of a plan document?

Clarification. My question related to the difference between a discretionary payment by the employer as opposed to a contractual obligation to pay. My question did not relate to what expenses were eligible or not eligible.

Where do you get the "if the plan says the employer will pay all expenses ..." stuff?

A healthcare FSA is a health plan that is subject to ERISA notwithstanding that is is mostly a tax trick. Neither A dependent care FSA nor a "premium conversion" plan are subject to ERISA. They are tax tricks like a healthcare FSA, so they are often documented together. The healthcare plan that is funded through the premium conversion plan is subject to ERISA. The healthcare plan is usually documented separately from the premium conversion plan. What constitutes a "plan" or a "plan document" for ERISA purposes is rather fluid and does not depend on pieces of paper in a single stack or avoidance of pairing with terms of an arrangement that is not an ERISA plan with the documentation of the ERISA plan. A healthcare FSA and a core healthcare plan can be separate plans or can be components of a single ERISA plan and the single ERISA plan can be composed of two or more documents or a singe document However, the terms of each written component of an ERISA plan should state what the component is and what plan it is an element of. Some document (usually the wrap document) should identify all the components of the ERISA plan that make up the single ERISA plan. Any plan should stat the plan year. I think the original post is asking if a component of the MEGA ERISA plan can have a different plan year than the other component(s). I think the answer is affirmative, but I am not certain enough to simply assert that conclusion.

Perhaps this is just being picky; it does not address the crux of your question. The following does not make sense: "the FSA Plan is not deemed as a policy". The following indicates a conceptual error: "the FSA ... cannot be bundled with an ERISA Plan". A healthcare FSA is an ERISA plan (subject to things like the employer not being subject to ERISA. This may be more just loose composition than a misconception that is causing confusion. If your Mega Wrap Plan is being treated as a single ERISA plan, what would you state as the plan year if one component (healthcare FSA) does not have the same plan year? Does that touch on your question?

Can you explain how your answer relates to the JPOD/MOJO combination and the validity of it?

As a matter of federal law, a QDRO can be modified or replaced as long as neither the alternate payee nor the participant has started benefits* or died before the change, subject to terms of the plan or the written QDRO procddures that protect the plan against adverse selection. State law is another matter. *Perhaps add the participant has not reached normal retirement age in a pension plan. Some may disagree.

"deferrals should continue until his 401(a)(17) limit is reached." I am confused by this statement; perhaps it makes sense in the context that I do not understand. I am concerned that this resonates with a debunked notion that 401(a) (17) indirectly limits elective deferrals. Generally, elective deferrals should continue until the elective deferral limit is reached, without regard for the 401(a) (17) limit. The plan terms may impose an elective deferral limit that is lower than the 402(g) limit, but that should be done only advisedly.

The payment can be made when the QDRO says it is to be made. In a defined benefit plan (a classic pension plan), payment to an alternate payee (you) is not usually made until the participant actually retires and starts receipt of benefits, subject to a special rule. Under the special rule, a QDRO can allow or require payment to the alternate payee to start at the participant's earliest retirement age, defined as when the participant could start receipt of benefits if the participant had terminated employment. However,the payment to the alternate payee can be made only when the QDRO says it is to be made, so you need to know the terms of the QDRO. The plan administrator should have a copy from when the plan administrator determined that the domestic relations order was a QDRO. A helpful plan administrator would simply answer the question: What is the earliest time I can start to receive benefits? Most plan administrators will provide you with a copy on request, perhaps subject to a charge for copying.