Bird

It can go back to the original IRA.

I think you can do it. Somehow the idea of jumping through hoops to convert each year, or periodically, is not very appealing to me, but if you don't mind, then go for it. Since your plan is with Schwab, you might want to check out their commentary, with warnings about having nondeductible IRA contributions: http://www.schwab.com/public/schwab/nn/articles/Roth-IRA-Conversion-Look-Before-You-Leap

I agree with the comments above, and I would insist on them reconciling the issue quoted above. It sounds like their "system" is in charge and they can't be bothered to fix it, and are trying to bully everyone else into submission by saying they are following IRS regs.

It's implicit. You are taking a summary/comparison chart and extrapolating way, way beyond its intended purpose.

We do annual statements for those type of plans. I couldn't cite the details of the requirements but am confident that is enough (perhaps not necessary at all for disclosure but good practice to keep track of sources annually).

Exactly. Think about the words. Required Minimum Distribution. You must take out at least X, notwithstanding other plan provisions, or your desire to take out less. Any language about taking out more is clearly (IMO) subject to plan constraints. Are those arguing that you may take out more, regardless of ISW restrictions, saying you could take out the entire account, just by virtue of reaching age 70 1/2? The RMD rules were layered on top of other plan rules, to assure that participants did not defer taxation indefinitely. The other rules still apply, except where the RMD rules override them. No doubt about it in my mind.

I agree. The IRS FAQs are meant for plan and IRA accounts, and I think it is meant for a typical IRA account holder - of course they can take out more if desired. It (absolutely positively, IMO) does NOT give a blanket "yes - no matter what the qualified plan says."

Agreed that if your plan is self-directed and intends to be 404c compliant you would use that code. The other plans you are looking at may not be self-directed - old fashioned defined benefit pension plans, perhaps.

I agree. We typically allow in-service withdrawals after NRA but if that's not in, then RMD only is required/allowed.

yes. MP money retains its character in a merger.

Sounds like a stubborn/recalcitrant participant. I'd mail the check, with a note that she'll get a 1099-R showing it as a taxable distribution, whether she cashes it or not.

In my world, a fee is something that affects gains and losses, so it would come out of the gain. That, IMO, would be "right." But I can see it being problematic for a recordkeeper who needs to determine the gain and then process the distribution. But as Lou S. notes the basis is what is tracked, and it is determined by the actual net contributions so I think generally it will be reported the "right" way.

If you're sending by US Mail then you don't need the street address. We've been using the North Rulon White Blvd. address for a number of years, via UPS, with success. I think I remember someone having a problem with FedEx but I think they didn't use the street address - that generally won't work with a delivery service.

You can always start a new plan with the desired formula, and merge one into the other on 1/1/16.

Not necessarily. If everyone had the same opportunity, I don't see a problem - weeks is not a discrimination issue IMO. As long as costs do not become a factor.

I see no doubt about it, the terminated participant is...a terminated participant and should be counted. Why is the recordkeeper involved in such decisions, do they have administrative responsibilities as well?

1. Agree 2. I cannot begin to imagine accruing fees like that.

Are you sure you can't find another way to use the $496, e.g. as a profit sharing contribution? If it is for him, it gets deducted on the same place (1040).

Can anyone confirm that their clients received one of these letters? Colonial Surety sent an e-mail with a sample letter, and while they had a recipient name/company on the letter, I think it was dummied up.

Agree. You can't "start a new and separate SEP for employees other than owner" but can can use the "3 out of last 5" exclusion to keep the employee out.

That's correct. It doesn't matter in this case and I'm not revisiting it. It might have had something to do with the way the contributions for employees was calculated. No problem with the simplified explanation.

mmm, since Mike rekindled this thread all of a sudden I remember a protracted "discussion" about the IRS worksheet several years back. I think there was some kind of a shortcut or flaw in it that gave an incorrect result in a particular situation...can't remember the details other than that I was right . It's probably fine for someone with no employees. FWIW, the maximum deduction is 25%, but that is on compensation after taking the contribution into account, so it boils down to 20% before the contribution.

The ones I saw, it was simply that they added 6% of their pay because that was the amount allowable that did not count against the annual addition. I think they could actually write a check and did not have to have the money withheld from their pay. If you are trying to reconstruct the contributions for purposes of determining basis...good luck. The couple of times I had to do it, I had half-decent records and was able to come up with the actual total contributions, or at least a defensible estimate.

Is there a question in there?

I'd say no. The language for the exception (from an IRS summary, not the regs) is "the employee separates from service during or after the year the employee reaches age 55." I'm assuming this is an in-service distribution...? That might be an important detail. Perhaps I'm looking to oversimplify it but it seems this is a simple issue that is clouded by someone with a misconception. I'm also curious whether the participant did a rollover way back or if the plans were merged/spun off. I don't think it matters...