QDROphile

Retroactive amendment will not work for elective deferrals and certain other contributions that must comply with elective deferral standards.. See Rev. Proc. 2013-12 about improvident distributions.

There is lots to dislike about illegitimate ESOPs. The S corp ESOP concept went too far so you can look at 409(p) as an attempt at defining a no fly zone. Or not.

Other than the year of service requirement, an employee cannot be excluded based on service (or lack of service). See IRC section 410(a). Year of service for eligibility is based on 1000 hours of service. Make sure you understand the conventions for counting service if actual hours are not recorded.

You should be very careful about distinguishing some options from the rest of the 26,000 unless you are already intending to treat the favored options as designated options and are comfortable with the implications under ERISA section 404(c ).

Read Notice 2007-7 concerning consideration of hardship of beneficiaries. Purchase of residence is not included.

Old trick. Not legal. Interest must be a commerically reasonable rate. The local loan shark is not offering commercially reasonable rates. The local loan shark is not worried much about enforcement, either.

It is best practice to designate for which year a contribution is made, and the plan document may provide for the designation as described. The plan document should be followed.

Without regard for the propriety of the corrections relating to health insurance premiums, an employer can pay whatever extra bonus compensation the employer wishes to pay (except to union employees). As long as the employer is counting it as W-2 income, bonus it is for plan purposes. Just be claer the the employer is not engaging you for advice about the back story.

I understand how a plan termination would cause distributions, but I don't understand how one day the sponsor can decide mandatory distributions should occur. Mandatory distributions occur in accordance with plan terms, not willy nilly. Did the sponsor amend the plan to provide for a different schedule for mandatory dstributions, such as changing from year-end to ASAP?

Many government entities have websites that describe their benefit plans. You might have to go to the hiring page and the descriptions are typically not technical. For example, the site might inform that the employees participate in the public employees retirement system. Government plans tend not to report, so lists are not easliy compiled from reports.

The plan will say, and not all plans require a year before giving the new spouse rights by default.

Plan administrator informs participant that the PA discovered the error and advises that the correct 8% will be implemented immediately prospectively. The PA will note that the participant may wish to increase the deferral amount for some time to achieve the savings that the participant may have intended for the year. If you are describing events in 2013, see the rule under EPCRS about correction when the participant has at least 9 additional months of deferral deferral opportunity in the year.

The plan is not required to allow what the law allows as exceptions to the irrevocable election requirement with respect to the section 125 aspect. Certain changes must be allowed to underlying health covereage under certain circumstances.

You cannot have rollovers without distributions. Elective deferrals cannot be distrbuted before age 59 1/2 to someone who is still in service. Your inclinations are dangerous to the qualification of the plan an dangerous to the fiduciaries of the plan. You need direct personal help in implementing your ideas properly. The provider of the pre-approved document is a place to start and the amendments will probably be in forms consistent with the pre-approved plan. That is usually the company that provides record keeping services to the plan.

Governmental 457(b) plans are regulated by state and local law and plan terms. You may have to go to the people who you believe are not acting up to standard, assuming there is a standard.

I apologize for not paying attention to the forum. I was thinking about qualified plans. Different world.

My thoughts are (1) it is strange that this should be a problem and there is a plan design flaw, and (2) almost no plans will accept elective transfers from outside of the controlled group so no one should worry about misinfomred participant expectations or aspirations.

Treas. Reg. section 1.401(k)-2(a)(4). No comment on its use or if it is too late to amend the plan plan to make use of it for 2012.

Cutting through the considerable amount of strange and probably inadvisable stuff, they cannot provide for allocations to the accounts of owners earlier than corresponding allocations to accounts of the the other participants. ESOP Guy's questions are getting to the same point.

The regulations provide detail on the explanation that is required. It is not sufficient to say that the account balance will be used purchase an annuity.

Your observation is perceptive. The solution for many plans is to overlook or disregard the uncommon compensation and rely (usually unconsciously) on lack of enforcement. Another solution is to have an election that applies only to regular cash compensation, such as salary and wages, perhaps with special elections for bonuses. The plan definition of compensation remains the same for technical purposes. The solution avoids involves the related communication problem with employees. In your example, did the employee really want the deferral of $1,980 rather than $1,800, especially if if meant that there would be extraordinary reduction of take home pay to cover the extra? You will have to be sure that plan terms do not interfere with the administrative solution.

I do not care to engage in the discussion that we agree would be interesting and beyond the typical scope of this forum. My intent was to apply a counterbalance to the opinon that it is "hogwash" to think that appointment of a fiduciary does not offer considerable protection to the appointing fiduciary, and may even increase exposure -- it all depends on how it is done and the circumstances. As a specific example of difference of opinion, if a plan sponsor is so foolish as to be the plan administrator of a retirement plan, I think that engaging aTPA as a fiduciary for services does not increase potential liability to the plan sponsor for a TPA screw-up on those services compared to a non-fiduciary engagement of the TPA for the sevices.

The plan looks to itself only, including QDROs.

From Rev. Proc. 2013-12: Comments continue to be requested on special issues relating to designated Roth contributions. For example, comments are requested on whether, if a plan failed to implement a participant's election to have a designated Roth contribution made on his or her behalf, but instead a pre-tax elective deferral was made for the participant with the participant's compensation reduced accordingly, it would be an appropriate correction of the failure for the employer to ask the participant whether correction should be made by a transfer of the contribution (adjusted for Earnings) to a Roth account under the plan and inclusion of the amount so transferred in the participant's compensation in the year of the transfer (instead of either (i) a similar transfer with a corrected W-2 for the year of the failure and the participant having to complete an amended return for the year of the failure or (ii) a similar transfer and inclusion of the amount so transferred in the participant's compensation in the year of the transfer, but with the employer to make a gross-up payment to the participant to make the participant whole for any increase in the resulting income tax).

Although the comments from Mojo are just side comments, I think the statements in the second paragraph about allocation of fiduciary responsibility, appointment of fiduciaries, delegation of fiduciary responsibilities, co-fiduciary liability, and exposure of plan sponsors need a lot more depth and detail to be accurate. The first paragarph is on the mark except for the presumption in the last sentence that the plan sponsor would be the plan administrator.