QDROphile

It appears that the plan sponsor company has financial difficulties that are serious enough to make some desperate moves, and then some. You are probably entitled at least to an installment, but the company feels like it cannot pay without jeopardiing the business. This is a dilemma. If you press for payment, the company could slip into bankruptcy and you would get nothing, ever. But that could happen whether or not you press. You could go to the Department of Labor for assistance. The DOL is interested in ESOPs that do not pay on time, but the DOL has no solution to the dilemma of financial crisis and can just as well sink the ship by intervening. If I knew that the company were acting in desperate good faith, I would sit tight and hope against hope that the fortunes turn and eventually something is paid. But there is no way to adequately assess if the company is doing the best it can.

If the terms of the plan (which include the loan policy) and the terms of the loan allow for the participant to cease payroll deduction and cause the loan to default, the fiduciary will have breached its duty with respect to issuance of the loan. A loan cannot be made without a reasonable expectation that it will be repaid. A payroll deduction arrangement is a good mechanism to assure repayment, but not if it allows the borrower to elect to render this he arrangement ineffective. If there is no impediment to a borrower's discretion to repay, there is no commercially reasonable expectation of repayment. Lenders are not supposed to be a trusting lot.

If the plan is a defined benefit plan it will probably not allow a domestic relations order to provide for distribution before the plan's earliest retirement age. However, you got a QDRO that allows a distribution at participant's termination of employment, so the plan might allow other distributions outside of what is required by statute. With respect to your CALPERS question, it is unlikely that you can use your QDRO benefit to enhance your CALPERS benefit if the benefit is a defined benefit. If you can get a lump sum distribution under the QDRO, it is possible that CALPERS might allow purchase of service credit with rolled over funds. In all likelihood you are just going to have to wait for your benefit under the QDRO. You should check to be sure you are awarded an appropriate portion of the death benefit to make sure the Grim Reaper (or an incompetent lawyer) does not deprive you of a benefit if your former spouse dies before you start benefits.

No permission needed. The statement is in the public domain.

We are getting a little off point, but severance pay is eligible for elective deferrals unless paid after separation from service. It is not that unusual to pay a severance amount on the last day of work to allow the employee the choice, although the average Joe is going to maximize current cash if it is the last income expected for a while. If the employee is stepping right into the next job, the deferral may be desired.

The fact that the employee has suggested the term/rehire fraud now prevents an innocent term/rehire, wink, wink, nod, nod.

The fact that the employee has suggested the term/rehire fraud now prevents an innocent term/rehire, wink, wink, nod, nod.

What got me started was a provision in a good form of plan document that expressly covers the circumstances to make it clear that the compensation is included/eligible. The same document excludes severance. The issue is not so much a legal one as a plan interpretation question, but the plan has to be applied according to the facts, including actual employment status. With such an express provision, the employer and employee can get the outcome that is desired and fits the subjective intent. I have never seen another plan document with such a helpful provision set out clearly.

ETA: Your thinking is correct and preferable. It is still possible to have a plan exclude the compensation through some combination of definition of compensation and employer characterization of the end of service. It is not always saying anything terribly interesting to remind about checking plan terms.

Unless the plan says otherwise.

The statements about paying by check make no sense. Are you suggesting a payment of the amount outside of the plan from the participant's personal funds? The early distribution "penalty" tax does not apply to distributions to alternate payees under a QDRO.

You need a better understanding of what a "lock" because of a domestic relations order entails. There really is no such thing, although most of the time the concept/practice does not cause any harm. You may also need to see how section 401(a) (9) works with respect to a benefit that is subject to a QDRO.

The tax code is quite specific about can be rolled over into a qualified plan. If there is a treaty that provides an exception (so highly doubtful that I am surprised at the suggestion, but it is based on legitimate principle), a plan administrator has no duty to investigate. The proponent of the rollover must present the argument and the authority. Even then, the plan terms probably might not allow the rollover even if the law does. The plan terms will track the code language and definitions quite closely and the tax code is quite specific about can be rolled over into a qualified plan. Unless the sponsor is willing to amend the plan, the tax treaty would have to be phrased in a way that coordinates with the tax code/plan language.

The plan says what the plan says and either interpretation is legal. Although I bristle at the idea of the payroll service rather than the plan administrator determining the meaning of plan terms, conformity with the payroll practices is often a necessary evil. The solution is to amend the plan so the terms clearly fit the practice. Oh, wait. I forgot. Nobody has plans that they can amend for language any more. The solution is for the plan administrator to adopt a written interpretation that reconciles the plan language with the payroll practice.

The plan administrator is responsible for interpreting plan terms. If the question is limited to deferrals, for a practical answer, one should look at how the payroll system functions with respect to application of the deferral election to the compensation for the extra hours.

Is the gift card taxable income? It is not a gift. How is it being reported.?

Someone suggested that the term is a mistaken hearing of "big league" which can be used as an adjective. Mind you, I am not trying to be an apologist or a language reparer.

The concept of control under 403(b) is well developed, although there are some difficult questions. A participant can "control" a nonprofit employer. The average employee does not.

Yes

#2 and #3 can be an issue depending on the surroundings, and particularly any terms relating to disposition before termination or attaining a particular age. Check the definition of pension plan.

1. Yes, there are restrictions and Peter Gulia described an exception to a potentially applicable restriction; the exception usually suffices to enable investment in mutual funds without any investigation other than the usual concerns about prudence (which include investigation of costs and fees). 2. The investment company is the "fund" so assets of the investment company are the securities held by the fund. Investment in the "fund" is accomplished by buying shares of the investment company.

It is almost universal that (1) insurance companies tell their clients that the insurance booklet is the SPD, and (2) the insurance booklet does not comply with the SPD disclosure requirements. Even if the substance of the insurance coverage is adequately summarized (or presented, if the booklet is also the plan document), the booklet is typically deficient in procedural and formal aspects. The plan administrator can supplement the booklet to cover the missing material. That is not a bad thing, because the exercise will force the plan administrator to think about the claims procedures and compliance with the requirements for claims procedures and who is the fiduciary with responsibility for adjudicating claims.

The claim for payment of benefits should be prosecuted under the plan's claims procedures. Those procedures will inform who is to be adjudicating (probably the plan administrator) and how to proceed.

I have felt many times like giving a heavy hit to a heavy hitter broker.

Some thoughts that may help or just make it harder: a plan is not required to allow a change just because the change is allowable under section 125. Off the shelf cafeteria plans are usually designed to allow any change that the law allows, but plan administrators still have the authority to interpret plan terms unless the plan says otherwise. Plan terms matter, not only the 125 plan, but the health insurance plan. However, health insurance plans are subject to mandates, such as HIPAA, that 125 plan are not