QDROphile

Even more important for hardship distributions ... .

You may be able to trace the plan through the annual Form 5500 that the plan files. The publicly available on-line records do not go back to 2001 but I think there are services that, for a fee, can retrieve the records and possibly could be more helpful in tracing the plan through various corporate and plan mergers because of familiarity with the information that a Form 5500 presents. See what Judy Diamond Associates does these days.

Why not repay the loan immediately? Is a new deal expected?

I think so, but I am not sure exactly what you want agreement about. I agree that if the employee has control over not providing addtional service (including by bad acts or nonperformance - "cause" for termination), there is not substantial risk of forfeture. I edited my first post to clarify.

If you are very sophisticated and appropriately cautious, you might consider the general doctrine of rescission. If you believe it applies under 409A, it might not be avaliable under the facts because the election was made in the prior year. The devil is in the details and the doctrine is fuzzy.

Second paragraph, section IV of Notice 2007-62.

A retirement plan is required to notify the participant and alternate payee "promptly" about the receipt of the order and "within a reasonable time" about qualification. You need that evidence. A surprising number of domestic relations orders languish and do not get deliverd to the plans. Individuals have to watch out for their rights. If "L" was represented, it is possible that her lawyer has retained the file that would have notices. It is a best practice for a lawyer for an alternate payee to provide for direct notices to be sent directly to the lawyer as well as the alternate payee.

Let's put it this way: You would not be alone if you concluded that involuntary termination by the employer without cause was a per se substantial risk of forfeiture. The IRS would not say that because the IRS always suspects skullduggery and the IRS knows what happened under section 83 with respect to noncompetition clauses. For example, if you were trying to shift a boatload of income from one year to the next and used involuntary termination as the risk of forfeiture, the IRS might argue that there is not a substantial risk within the time frame. But if the vesting date is five years out, I doubt that the IRS would blink an eye unless the person who controlled employment was the participant or a lackey.

The IRS has said informally that as long as the practice is regular, a pay period that crosses year end can have pay recorded in either year. A written policy would be nice. I would start to be concerned about a pay period of a month. What happened the year before?

In a NQDC Plan, the benefit is what the plan says it is. There is no legal issue with the plan providing for no time value of money. The persons who are the participants are usually sophisticated enough and powerful enough to avoid being denied time value of money. Note that the IRS has expressed doubt that elective deferral and substantial risk of forfeiture can go together.

I always manage to refer to rabbit trusts. I don't think I am either a leporidaphile or a rabbiphobe. I regret that I have no referrals. I have never been part of or party to such a quest.

No, I am saying that if the provider has a rabbit trust product, a lot of things will fall in place without the confusion that you described in your original post. If the trust provider is independent of the investment provider (not common), then it might be possible to avoid the confusion simply by opening the account in the name of the trust; the investment provider need be none the wiser. You still need to be careful to assure that the participant does not have authority to withdraw funds.

You are correct that using a grantor trust is different. The trust arrangement is made for nonqualified deferred compensation, so you should not have the same difficulties with understandings. I do not care for grantor trust arrangements because I think there is little value for the cost. Executives tend to want them becuase their counterparts with perceived large appendages have them.

The account owner must be the organization. You must have assurances that the participant cannot provide instructions concerning payment. Most 457 arrangements allow the participant to direct investment, but that is a tricky combination: the particpant has authority to direct investment, but not the authority to direct disbursements. As awkward as it may be, the safer arrangement is to have the participant provide investment instructions to an authorized organization representative for execution; the particpant should have no authority whatsoever as far as the provider is concerned. If you keep it simple this way, it is just a brokerage account for the organization. No explanations needed for the provider.

Another reason for "don't"

Does the plan have self esteem problems? Employers have plans for the benefit of employees, and former employees probably only because ERISA requires it. You have identified some reasons not to go beyond the convention of allowing rollovers into the plan only by employees at the time of rollover. So don't.

Carmona v. Carmona, 603 F3d 1041 (9th Cir. 2010). The survivor interest under a QJSA cannot be invaded directly or indirectly. The opinion cites the earlier Fourth and Fifth Circuit decisions to the same effect, but with less convincing analysis. Until Carmona, I and others (in the minority) asserted that the Fourth and Fifth Circuits were wrong. The participant's payments can be assigned.

"The recipient can be changed to a different person providing said different person is an alternate payee and they get a new QDRO directing the payment to the alternate payee." Not true for the contingent annuitant's QJSA interest; possibly true if the plan is expressly designed to allow it, but no plan should be designed that way.

Stay away from extra-judicial input on determination of matters required to be included in domestic relations orders. The plan administrator can determine that an inexact title refers to the plan, but the individuals do not get to agree on anything and the plan administrator should not seek agreement or stipulation. The courts are very forgiving about what "clearly specifiy" means; it is up to the judgment of the plan adinistrator. A "supplement" to the order is really an interpretation of the order that is expressed by the administrator in the notice of qualification. Examples above are feasible. Another example: "The order applies to the Plan."

I agree with your approach to fit the circumstances. Even in my dream world the plan cannot bring forward earnings from early dates, such as "50% of the balance as of the January 17, 1998 divorce, with earnings on the AP's share until distribution." The parties to the order have to figure out some formula or number for the earnings up to some viable date in the present administration system. There is no legal requirement for the plan to perform that function, so 414(p)(3)(A) would apply. But there is that nasty records requirement for balances. The reason my clients can do it is becuase we have been advising them about what needs to be done when record keeping changes.

For real. The point you make is a good one, but involves different issues and a different set of policies. And I believe that a plan has an obligation to keep historical balances no matter how many changes in record providers, not that they do it properly. I do not think they have to keep daily balances, which gets into policies about using reasonable valuation dates and conventions for identifying the appropriate one to the extent the order does not specify (the valuation date that is nearest the desired date, immediately preceeding, or immediately following?). Most of my clients can handle January 17, 1998 within legally acceptable tolerances (the answer is December 31, 1997). I am living the dream.

This is not a problem and you are going overboard when a solution may be at hand. All you need are the beginning and ending dates dates of participation and the marriage. I certainly have encountered dingbat lawyers who refer to times relating to the marriage but do not provide the relevant dates, as though plan should know what is in all the court documents. You ask them to specify the dates in the order, not demand specification in a rigid format (although I am sympathetic to the idea that they sould do the work, not the plan -- but then the plan will get lots of requests for balances at different dates, which might be more trouble). Example for a DC plan in which the participant had a balance at the marriage date: Take the balance at the marriage date and subtract it from the balance at the divorce date. That is your number as of the divorce date to divide by 2 (50%), effectively giving you the "as of" date you want. It works the same when the particpant was married when participation started. The subtrahend is zero.

You still have not provided enough information to respond to your request about any requirements for disclosure or information required by mandates other than ERISA (since ERISA does not preempt). For example, if the plan is not subject to ERISA, but is a governmental plan, state law may have requirements or standards for something that is functionally the same as an SPD. Document providers are seldom to be trusted, even on matters relating to documents. Are you relying on the document provider for the conclusion that ERISA does not apply?

The 403(b) regulations require a plan document and are oblivious to the application of ERISA. Your question is ambiguous. Are you asking if the plan is subject to ERISA or are you positing that the plan is not and asking if there are requirements nontheless? Either way, you have not provided enough information for specific answers other than about a plan document.

Plan amendment. The plan sponsor controls the terms of the plan. I have no sympathy for buyers of inferior products. There is a more sinister approach. If only a few rugged individuals refuse to direct a distribution, they might want to know that they will be bearing the full administrative cost to the extent permitted by law. They might be less intransigent after seeing some relatively hefty expense charges.