QDROphile

Don't expect to find anything specific about your Roth circumstances in EPCRS. You will have to build on principles. The IRS asked for comments about Roth issues whe it published Rev. Proc. 2013-12. I agree that VCP is warranted, but check on the self-stated limits of VCP with respect to income tax issues that are outside of qualification matters.

It is possible for the CA pension to have begun distributions to the participnt without a QDRO. In fact, the plan had to begin on time unless it had a domestic relations order. I think the responses are too specfic given the uncertainty about the facts. I could come up with an entirely different explanation, but it woud involve the same degree of speculation that the other views engaged in. I can say for sure that a social security number is NOT a requirement for qualification and neither is a birth date. The Plan can and will require both for determining and paying a benefit, but that information is not required to be in the order and is not required to be given before the order is determined to be qualified. The Plan may assert otherwise, but it would be wrong. Usually it does not pay to fight the Plan about formalities like that. Under some circumstances date of birth is not necessary at all. Prudence about identity acknowledged, the AP's address (not "last known address" by the way) still must be stated in the order for qualfication. Some courts have procedures for protecting the address from public disclosure.

Evaluation for operational failure and possible remedial action would be appropriate.

I am curious about you conclusion that the plan cannot distribute anything more to Dr. B. Unless the plan's QDRO procedures have an earlier trigger, the plan conducts business as usual until it receives a domestic relation order. Then it depends on the terms of the order wether or not distributions are allowed and how much. It is possible that the contempt proceeding has generated a domestic relations order that has been delivered to the plan, but I don't take it for granted. The person who should be concerned is the plan administrator, who can be liable for consequences of improperly interfering with the rights of participants. Given the complexity and potential nastiness of the situation, you should be very careful about reaching any conclusion about what should be done and should look to instructions from the plan administrator unless somehow it is your job to be providing advice about distribution eligibility and QDRO administration. If it it your job, you might consider buying some advice; the details and nuances may be very important in this matter.

From instructions to Form 1099-R: Nonqualified plans. Report any reportable distributions from commercial annuities. Report distributions to employee plan participants from section 409A nonqualified deferred compensation plans (including nongovernmental section 457(b) plans) on Form W-2, not on Form 1099-R; for nonemployees, these payments are reportable on Form 1099-MISC. Also, report distributions to beneficiaries of deceased plan participants on Form 1099-MISC.

The board does not have responsibility for naming a fiduciary if the plan document gives that authoriity to someone else, such as the CEO. That means you are screwed (in so many ways) by using a prototype plan. If the prototype does not name the sponsor as the plan administrator, the best that you get is a provision that the sponsor can name a different plan administrator, and the authority to act for the sponsor rests with the board unless corproate governance documents provide otherwise.

I misunderstood the question to be more like "Who should be named as the plan administrator?" than "Should we do anything if we see an apparently mistaken identification of the plan administrator in an RFP?".

Would you rather tell the independent directors of the company that they (and others) are ERISA fiduciaries, which would be the case if the plan sponsor were named as the plan administrator? Who do you think it should be? The HR person is the person who, in fact, is usually responsible for operation of the plan. Who better to discharge the responsibilities? I recommend a committe of the chief HR person and whoever else is supposed to have top level responsibility for the plan, such as the CFO.

Only in the Departmentof Labor's mind, contrary to the plain words of the statute and federal court decison.

I agree with GMK except for the penultimate sentence. Unless the QDRO procedures speak to what happens before receipt of a domestic relations order, the plan should not do anything out of regular course in anticipation of receipt a dometic relation order. If the procedures are silent, the "hold" is a mistake and the plan administrator can be liable for any adverse consequences of interfering with the pariticipants rights or benefits.

From instructions to Form 1099-R: Nonqualified plans. Report any reportable distributions from commercial annuities. Report distributions to employee plan participants from section 409A nonqualified deferred compensation plans (including nongovernmental section 457(b) plans) on Form W-2, not on Form 1099-R; for nonemployees, these payments are reportable on Form 1099-MISC. Also, report distributions to beneficiaries of deceased plan participants on Form 1099-MISC.

SIC is relevant to a QSLOB analysis.

W-2; 20% mandatory withholding does not apply; other withholding rules apply. If you are asking these questions I hope the plan is getting advice about eligibility for the distribution.

QDRO question: They are usually similar, but it depends on plan terms and policies that should be reflected in QDRO procedures. Did you intend to put this in the 409A column? Getting outside of qualified plans adds some wrinkles to QDRO questions.

What remedial action is going to be taken concerning the CPA?

How is this any different from any other premature distribution, except for finding the the order is qualified to allow any distribution? It is an operational failure, details to be provided by plan terms. You have the same spectrum of practicality to formality to consider in how you ultimately dispose of the payments, and the same question about use of SCP or VCP.

As suggested by shERPA, a compentent dissolution will identify persons with wind-up authority for any coporate matter that needs attention after dissolution.

Consider what you would do in accordance with Rev. Proc 2013-12 if this were an operational failure to follow plan terms. I am guessing that the plan says that contributions are determined by a participant's deferral election. It would look a lot like what was suggested above, with related earnings taken into account.

Transfers are possible with appropriate plan terms. Certain rules govern transfers, including fiing with the IRS in advance under certain circumstances (uncommon for defined contribution plans).

How did the plan administrator interpret "the death of the participant will not have any affect on the alternate payee’s assigned interest" when the order was detmined to be qualified? To me, that language would award the QPSA to the alternate payee under the circumstances and nothing else unless the plan or QDRO procedures provide for something more. It would be nice if the QDRO procedures specified that if the participant dies before the alternate payee starts benefits, the only benefit to be paid to an AP is the spouse death benefit to the extent the QDRO expressly assigns the death benefit to the AP. Under that standard, the language of the order is sufficient to assign the QPSA despite being rather indirect. If the plan administrator did not think the order assigned the death benefit, the plan administrator should have confronted the issue at the time of review for qualification.

It depends on the legal status of the employer. A government or governmental instrumentality cannot adopt a 401(k) plan. It may be possible to get into a grandfathered governmental 401(k). Determining status of a governmental instumentality can be difficult.

To the extent you are referring to my incessant interloping comments that the employer should not be the plan administrator, the point is not that an owner, officer, or employee should not be the plan administrator. The main point is that naming the employer does not adequately identify the warm bodies who are supposed to have actual responsibility and fiduciary liability. "Employer" will be overinclusive or underinclusive, with overinclusive probably being the worst (e.g. making an independent director into a fiduciary). For a sole proprietor who intends to be the plan administrator, it probably is not an issue.

I agree with ESOP Guy and a good plan document will not be silent on the subject.

The trust is the legal owner of the assets and does distributions and tax reporting. Everything just lines up better if the trust is identified. It may be possible to work with the "plan" but maybe not and in any event people would have to think outside of the easiest convention and that is a terrifying prospect for cookie cutter providers. The really sad part is if you applied for an EIN for the trust, the IRS system is confusing and misleading and would give you bad information about filing.

If the plan sets a deadline for the contribution, then missing the deadline would be an error that requires correction and imputed eranings. You have to look at the plan terms closely. I don't think it is very smart to have a deadline even if the match is generally monthly.