Bird

Belgarath, I agree with you, on both the original point and what it says in Sal's book. I was going to say that I'd calc and treat any money coming out as an RMD...but I think it's actually pretty clear that it's not, and in fact that may be intentional. Thanks, I learned something today. (Not sure I'll retain it though.)

I agree with you. But there is no requirement to do so, and if there are no differences for withdrawals then at the end of the day it won't matter. (But it could matter and that's why we want to do it right.) It's actually more of a business decision as to whether you want to be bothered offering a different level of service. My experience is that when you try to "just" do something an "easier" way it doesn't turn out to be that easy. I mean, just thinking about it is a nuisance, right?

RMD stands for REQUIRED minimum distribution. There is no debate about whether or not it must be done; consent is not needed.

Not sure but I think you might be right; sounds reasonable. Still wondering about the custodian.

I change my answer; it is or certainly appears to be a document issue (and I was in fact looking at my document and not the regs). I can't say I follow the logic about how the definition of the maximum amount addresses this, but it has become clearer to me that the restrictions are in fact on 401(k) arrangements, and not on matching or profit sharing monies, unless the document says so. In fact the EOB has a line that states that (but that product has become so unwieldy that I can't begin to quote it*). I think the term "hardship-like" is appropriate. *OK, I figured out how to change it to text that can be selected (but it's still no fun to use!): 3.d.2) Other types of matching and nonelective contributions are not required to be so restricted. Matching contributions (other than QMACs or safe harbor 401(k) matching contributions) and nonelective contributions (other than QNECs or safe harbor 401(k) nonelective contributions) may be subject to the normal distribution rules which apply to profit sharing plans and stock bonus plans, as described in 2. above. For example, the employer's profit sharing contributions could be available for distribution after 5 years of participation in the plan, or attainment of a specified age that is younger than age 59½, even though the elective deferrals could not be distributable at such time. Also, these types of contributions could be subject to a hardship distribution option that would not have to satisfy the restrictions enumerated in 4. below with respect to those funds that are subject to the IRC §401(k)(2) distribution restrictions. "4. below" are the 401(k) hardship rules. Geez, I probably just violated some copyright...

I think you're right to second guess. I think that the criteria (safe harbor) controls the suspension, and the source doesn't matter.

K-1 does not generally provide a fair market value, although with a hedge fund, if the underlying investments are readily valued, then (I think) the capital account will essentially devolve to FMV. But it is highly unlikely, IMO, that the FMV went from $273K on 12/31/11 to $0 now. I'd challenge/question/review the $273K. But as jpod notes, if he has other IRAs, he'd have to take money from them to the extent possible to satisfy the RMD. A $0 value on a 2012 5498 does you no good, IMO. Curious as to who is the custodian - a local trust department, or one of those firms that specializes in self-directed IRAs?

Yes. I've used a 401(k) document for profit sharing only for various reasons.

I think you might be right about it being a PT, or, more precisely, giving rise to a PT after he and the plan wind up with joint ownership. Transferring 100% in kind would be ok, I think (if the plan terminated, and presumably it would go into an IRA). (Sounds very familiar and I think "we" concluded that if you're going to do this bad thing of having RE in a plan or IRA, keep some cash on hand.)

I don't know, but my take is that "Hurricane Sandy is now a safe harbor reason for a hardship." I don't think it changes the steps needed to qualify.

I agree, the Alternate Payee would typically get gains or losses from the valuation date, and I think this order is saying that, although not all that clearly. The Wife shall be entitled to one-half (1/2) of the marital share plus any earnings or losses on said share as of the date of separation on February 28, 2011. I think means to say: The Wife shall be entitled to one-half (1/2) of the marital share as of the date of separation on February 28, 2011 plus any earnings or losses on said share. If I were reading it, I'd probably shake my head a bit at its sloppiness and read it as I say above. It doesn't have to include gains or losses from the valuation date, but that's not what I'm reading here.

Nothing like being eager, huh?! As I understand it, the amendments wouldn't be due until the end of next year. I don't anticipate seeing actual amendments for some time.

Not only that but I think you have to think twice about what is "conservative" - it seems the assumption is that saying "no" is the safe or conservative position. But, since the regs don't specifically say the participant has to be purchaser, in saying "no" you appear to be denying a participant rights under the plan. I'm not so sure I want to be on that side.

Ditto.

The HR person either knows too much (just enough to be really dangerous) or too little. This is going to blow up sooner or later; prior responses are on point.

If you had merged the two plans into one, then all PS assets would automatically go to the 401(k) plan - akin to "forcing" a rollover, but not correct terminology. And you'd have to keep the annuity options on that money. But if the plan terminated as you say, then you can't force them to roll it over regardless of what the distribution options are.

Wow, great commentary by masteff, excellent link to article by Tom, and Belgarath makes a great point about RMDs in later years* (I feel like a play-by-play commentator). Nothing much to add. *OK, I'll expand on this in case it's not obvious - the RMD is around 4% in the first couple of years, but increases. It's close to 10% at age 90. You have to make sure you have liquid assets to satisfy the requirements - if you're only getting 2% or so from the charity, the money needs to come from somewhere else. As long as you don't lend 100% of the IRA to the charity and keep 10, 15, 20% (?) liquid, that problem can be planned around. Bets are off if you live to 100, when life expectancy is 6.3 (15.8% RMD) - and the effective percentage increases significantly thereafter.

Ditto on all of the comments on being careful and getting competent legal counsel. Any time life insurance comes up as a solution, and especially in a convoluted scheme that involves borrowing, you need to take a giant step back and ask "what, exactly, am I trying to accomplish?" and then ask if there isn't a more direct way to do it - like just making a direct contribution. I mean, if you are lending money at a market rate of interest, then there's no gift element to that, and if you lend at a below market rate of interest, then there is some gift element to that, but it's not all that significant (assuming the lending is possible at all, which I think it is, but then I don't know about the life insurance part...it definitely seems to me that no proceeds could be coming back to your IRA or your heirs). In other words, you started out by saying you are in a position to make a charitable donation, but it doesn't appear that you are actually donating much under the scheme as it is outlined.

Worked for me today too. Closed the browser this morning. Also noticed the different font.

Same here. I can't figure out any rhyme or reason - thought that by logging out and closing the browser, it made a difference, but apparently not.

That's correct. But think about it...Windows 8 is here, and no matter how much we all don't like it, we're going to be using it, then 9, 10, etc. You'll probably have to keep an old computer hanging around, and sooner or later it's going to fail. So that's not much of a contingency plan, in the long run. That was a problem for me; you can make your own decisions. (And as I think I noted, I intend to reconsider this in time, so eventually may determine that it's not such a problem.)

I tried the admin system...I guess it was last year. I have nothing bad to say about Ft. William; they went above and beyond in support, as they always have for Docs and 5500s. In the end, I couldn't stand to lose all of the historical data on Relius (every once in a blue moon, it is nice to pull up a 2001 plan year and look at the details). Nevertheless, I like doing business with them so much that I may give it another shot in the next couple of years.

Again, not claiming expertise, but I think the combination of a tax-qualified plan, and a mortgage, is a classic UBTI situation. (Debt-financed income leveraging tax-favored money.)

There has to be "income" in order for there to be unrelated business taxable income, so maybe the property isn't generating any income? Or maybe it is below the minimum reportable, $1,000 I think. I wonder if they will still say if there is nothing to report if it sells for a gain? (Can't say I am knowledgeable here; just taking a stab at it.)

I'm not sure how you pay the fees quarterly and charge them to each account annually (balance forward?) but would show them when actually charged to the account. (Good point about quarterly statements being required.)