QDROphile

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.

A company that insures persons other than employees will not be operating under ERISA and will be subject to state insurance laws. That is likely to dispose of the self insurance idea.

A company that insures persons other than employees will not be operating under ERISA and will be subject to state insurance laws. That is likely to dispose of the self insurance idea.

I think the plan's administrator's interpretation is of questionable legality. Generally, if the participant is eligible for a distribution, the AP will be eligible. The AP also has statutory eligibility based on "earliest retirement age." Plan terms can provide eligibility even when the participant is not.

Don't read it as a limitation. In addition to the AP being able to take a distribution when the participant is eligible, the AP is also eligible for a distribution after the anniversary of the divorce, which strikes me as a pretty stupid provision because it involves the administrator in determining the date of divorce and that is a matter of state law and circumstances.

No.

No empirical experience. I think what the IRS would do depends on the circumstances and the auditor. As you have observed, the IRS could assert disqualification

You need to assess the securities law issues. The MEP might not be eligible for the standard exemption from registration and from the investment Compant Act.

Wait to see if the plan receives a domestic relations order. Evaluate the order received, if any. Bemoan the fact that the Deprtment of Labor was completely unhelpful in response to the mandate from Congress to provide guidance about the effect of death before a domestic relation order is determined to be qualified.

You appear to have a dispute about the meaning of the words in the judgment. The terms are ambiguous -- if a lawyer drafted the language the lawyer is incompetent. Although not necessary, it is quite common to divide each plan. Personally, I would interpret the language to means that the former spouse gets 50% of the pension, 50% of the 401(k), etc.

My simple reading of the post does not include the interpretation of the responses to the effect that the participant can take a partial distribution that does not include the loan. Subject to the usual caution about following plan terms, there is nothing wrong with taking a distribution that includes a loan balance. The loan balance cannot be rolled to an IRA. In all likelihood, the balance will be taxable and will be included in the amount that is subject to mandatory withholding.

How could an administrative matter be a settlor function? This is one of the evils of the malpractice of naming the sponsor as plan administrator or having the administrative contracts with the sponsor. No comment on the original post.

If you are associated with the plan, your question is impertinent.

You are really talking about distributions in kind. In addition to the valuation issue, applying withholding rules can be more complicated.

Does the IRA custodian have any duty? The IRA custodian does not have the same concerns as a qualified plan administrator.

Direct the distribution to an IRA. The distribution will not have been made because the participant will check with the receiving plan before the distribution and will learn of the receiving plan's refusal to accept the prospective rollover. The participant will provide distribution instructions appropriate for a direct rollover to an IRA that the participant established for the rollover.