Bird

If the voluntary contributions are from pre-1986 (I think that's the date) then you can pull them out first, not pro-rata. There's a cite for it...but I don't have it.

Correct. There was a recent Sungard Relius Technical Update exactly on point. It also says that something reported on Sch A does not also go on Sch C.

OK, so as I understand it, we really do have to complete the "Paid preparer" part of the 945. I personally have a PTIN, for this specific reason. So... they ask for my signature and my PTIN, and my firm's (a corporation - it says "Firms's name (or yours, if self-employed)" - I'm not self-employed) and EIN. But they don't ask for my name, so I'm not giving it to them (except on the third-party designee line, which is a different issue). Does that make sense (that the form should have my signature but not my name)? Is it correct that they want an *individual* to sign and be linked to a PTIN (or SSN)? For my small company, it all boils down to me anyway, but is Joe Smith who works for Bisys or whomever using his own PTIN? Somehow that doesn't make sense to me, and I get really hung up on things that don't make sense. I relied on someone else's guidance on this a long time ago and now I'm questioning it. thx

Probably...almost certainly, IMO. And that's the problem - you don't really know how to allocate to that group. I'd lean towards pro-rata vs. "whatever you want" but only because it is consistent with typical language. Maybe if you submit for an FDL by 4/30/10 you'll have a chance to fix it. That doesn't help with the '09 allocation right now...

Most documents have additional language saying how to allocate within the group (probably pro-rata); does this one? My guess is that the drafter didn't contemplate having more than one person in that group.

I'm not any kind of an expert on VCP or CAP but I think the solution has to be to retroactively allow what has happened already. You can't really even think about trying to adjust returns as if it had been trustee-directed.

I did reach the same conclusion (not to report) when we handled the transaction during the year and researched it. I think I'll stick with that decision.

I am wrestling with this too. The 1099-R instructions say that "Amounts paid under an annuity contract purchased for and distributed to a participant under a qualified plan can qualify as eligible rollover distributions." But the regs (1.402©-2, Q/A -10) go on to talk about how the contract could be surrendered, and (I don't know about you but) I'm talking about a single premium immediate annuity with monthly payments, and such a contract can't be surrendered. Maybe I'm overthinking and should just report it as a rollover and be done with it; the bottom line is that it's not taxable and probably doesn't matter.

For the record, this has escalated beyond "a little frustrated."

If I knew for sure they had 1000 hours I would give them the year of service.

I agree. I think we are all confused about how this came to be; if the employer didn't submit deferral money for some reason and forfeitures were used to make up the difference, that is clearly wrong and the forfeiture account should be reimbursed. I don't know if it is as simple as that if you want to make sanctioned correction, but that is ultimately what should happen.

A little frustrated yes, but they are the only ones I know of who do outsourcing for the 1099s, at least at that price. We don't have all that many so I think we'll just be able to put off the whole "job" and do everything at once. FWIW.

I'm pretty sure you would treat it as two separate events - a taxable distribution, code 1 or 7, and then...well, plans don't report rollovers in, so I guess that participant will just have to be prepared to some splainin'. Serves 'em right for making you do the extra work involved with a distribution!

The IRS/DOL identify a plan by the combination of sponsor ID number and plan number. The person who disagrees can ponder how to file two returns for the same plan.

Ignore him and set up the account and move on to your next item of business.

Sounds like it probably defaulted on June 30 or earlier; check the loan policy to determine the date of default and use the value on that date.

As you describe it, that is a continuation of the same plan and only requires one 5500.

I don't claim total innocence in this area, I mean, if something needs to be tidied up and it's just a piece of paper, let's just say that those pieces of paper have been found. But when it comes to something that affects benefits, I'm pretty strict. Belgarath makes some great points, especially about protecting yourself.

Yeah, I think you pretty much understand what I'm trying to explain. Most platforms, at least for smaller plans, are done through investment companies or insurance companies and need a broker. If you're not a broker, and you want to use a platform that requires a broker, then of course you have to find one (you could go to the investment company and ask them to recommend one). All kinds of warnings should be going off right now, because if you aren't interacting with brokers regularly now, you'll find that they have a tendency to f..er, mess things up, and increase costs. That's a longer discussion. (For the record, I am a broker, but as a group, they really bother me.) If you want to try a no-load company (i.e. no broker) you might try T. Rowe Price. I briefly looked at something they were offering a couple of years ago, and it seemed like it might work, although at the end of the day, their no-load product had some extra charges built in and was costlier than the American Funds alternative. I don't know of others. Some of this depends on your office model, admin system, etc. so what's right for me could be dead wrong for you. If you want to talk further, send me a private message and we can talk by phone or e-mail.

Sorry, I missed the part about contributions being allocated at the end of each month (why would anyone do that?!). And if that's the case, then I'm not sure I understand what additional calcs are being done at the end of the year, so I'll change my answer to "I don't know."

I believe that is a mis-allocation and you can transfer it to other participants' accounts. You have to make a decision about gains or losses; it sounds like a small amount and I would probably ignore it. Write a letter explaining that the proper contribution amount is "x" but "y" was deposited so "x-y" will be removed.

I generally use a document from an investment company and let them keep the documents updated. I figure that a SEP, SIMPLE or whatever isn't worth it if I have to think about it very much.

Nothing special required, and I disagree that the losses were caused by the movement from one firm to another. A snapshot on that day had the investments not been moved would have shown the same result.

They can and should "amend" the existing plan to remove the 401(k) provision. Whether it's easier/better to just amend or "amend and restate" (i.e. the same plan but a new document) depends on the form of the existing document and who is doing the work. You don't want to "terminate" anything.

I don't think it matters, unless your plan uses those definitions, e.g. in group definitions for allocating contributions.