masteff

Has the plan considered that those retirees have a valid expectation that the funds will be deposited in a timely manner and may have automatic deductions scheduled to draw on those funds? It's probably just sheer luck they haven't caused financial harm to a retiree. Whether or not it's illegal, it most certainly is irresponsible.

I agree after reading IRS Pub 590 and instructions for W-2... nqso is reported on W-2 using code V which says to report the spread in boxes 1, 3 and 5. Pub 590 says comp includes any amount properly shown in box 1 of W-2.

Were the children primary benes? I'd think the disclaimed portion would first divide among remaining primaries as if the disclaiming person had predeceased the IRA owner. But you really need to address this to the IRA company because their policies and procedures will control how they interpret a disclaimer. The important point is the disclaiming person can't name who the disclaimed share goes to. It's dictated by the IRA agreement and the deceased's beneficiary designation.

If your plan does not provide for automatic offset upon default, then the cows are already out of the barn. You can't retroactively offset the loan. And because the regs permit payments on deemed loans, you do not have an overpayment. No overpayment, no return of money to the participant. Those were perfectly valid loan payments, so they stay in the plan (until a valid withdrawal is made under the plan's distribution rules). And if you offset the loan now, same result... the payments stay in the plan until a valid withdrawal.

Bill didn't exclude the 6 months of comp because there's nothing that generally requires that. Put it back on the TPA to provide a citation from the plan doc or the IRS code and regs for why comp should be excluded during hardship suspension. Feel free to post it back here for us to help you evaluate.

I personally would read "additional match" as an allocation based on matching contributions (so everyone's match goes up proportionately). I give, what's the difference between a cat and a match?

Discussion on suspense accounts tends to focus on forfeitures rather than PS prefunding, but along w/ QDRO's post, you might try to find Revenue Ruling 80-155 mentioned in the 2nd paragraph here: http://www.irs.gov/retirement/article/0,,id=223590,00.html

I presume you're referring to the annual earnings test which applies to persons who receive SSA prior to attaining their SSA full retirement age. http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1811.html http://www.ssa.gov/OP_Home/handbook/handbo...dbook-1812.html http://ssa.gov/pubs/10063.html

I think a key search word here is: sham http://benefitslink.com/boards/index.php?s...475&hl=sham

It appears to be based on SSN but I'd be reluctant to presume it's the SSN 100% of the time. https://www.cms.gov/MandatoryInsRep/Downloa...tionSSNEINs.pdf http://www.academyhealth.org/files/2009/sunday/EppigF.pdf http://www.cyaninsurance.com/news/what-are...neficiary-codes

So the administrator is alleging that management is illegally hiring undocumented workers? And the administrator feels it's his/her duty to backdoor enforcement via the health plan instead of reporting mgmt to the proper authority? Perhaps you should give the administrator some light reading: http://www.uscis.gov/files/form/m-274.pdf Be sure to point out page 27 which discusses "document abuse".

A recent thread on the topic: http://benefitslink.com/boards/index.php?showtopic=49692 My personal opinion is this is a theft loss and not a casualty loss.

As to the question of allowing a separate deferral election on bonuses... Does the plan document need to specify the right to make a separate election for different elements of comp or is this merely an administrative convenience? (Of course I should specify that I would only consider a separate percentage election and not a yes/no election.) @sugar daddy: Unless they only have a handful of employees or unless the bonus is paid on a separate check, have they confirmed their payroll system can handle this? A separate election on different elements of comp adds a whole layer of complexity to the calc that not all payroll software can manage.

Because of the "Protecting Tenants at Foreclosure Act of 2009", the eviction of the participant is far from being certain. Considering the complicated legal issues, I would deny the hardship request.

That's a curious outcome since in the past we've discussed on this board that someone over 70 1/2 and actively working could roll in from an IRA or other employer's QP and thus avoid future year's MRDs. Edit: of course I note that I reached the same point of ambiguity 4 years ago. http://benefitslink.com/boards/index.php?showtopic=36487 http://www.irs.gov/irb/2004-07_IRB/ar08.html "However, a distribution of amounts attributable to a rollover contribution is subject to the survivor annuity requirements of §§ 401(a)(11) and 417, the minimum distribution requirements of § 401(a)(9), and the additional income tax on premature distributions under § 72(t), as applicable to the receiving plan."

My strategy is to divert the conversation with "have you met my girlfriend, the flight attendant?" (true fact) Which hopefully leads into my Amsterdam anecdote and away from the pros and cons of regular vs Roth contributions.

You need to cross reference to: de minimis cashout and automatic rollover You might have to amend the plan to restore the cashout limit if it was reduced several years ago when the automatic rollover rule was enacted.

Prior discussions on same: http://benefitslink.com/boards/index.php?showtopic=37784 http://benefitslink.com/boards/index.php?showtopic=23914 It appears your answer lies in Reg 1.411(a)-11(e)(1)

I like Peter's suggestion and would love to see the regs say that grossup shall be based on reasonable marginal tax rates and can't exceed amount of withholding. 1) I agree w/ your earlier statement. 3405(b)(2) seems to require an election; and unless there's some guidance I'm not aware of, I don't know how the employer can legally make an election of less than 10% on the ee's behalf. 2) When I administered hardships at previous job, it was very easy to go to each state's tax authority and see their rate structure. So it's pretty easy to do a "smell test" on the tax rates being used for the gross up. As plan administrator, I actually dictated what was reasonable (and consistent w/ prior practice) for grossup based on known payroll information (I strictly generalized, never tried to work backwards into the EE's actual situation); if someone claimed to be in a significantly higher tax bracket then I wasn't bashful about requesting supplemental documentation (e.g., page 2 of prior year's tax return which shows taxable income, spouse's W-2, etc). I didn't read all of Reg 35.3405-1T, but looking at, for example Q&A d-23, I'm going with: yes, it's ok. (Also, the regs covering the W-4 in 31.3402(f)(5)-1 allow the use of an alternative form if the proper instructions, etc are included; I see no reason that doesn't extend to the W-4P.)

1) Further in the paragraph on Transfers it says, "However, you must report ... Direct rollovers from qualified plans". This is a direct rollover from a qualified plan. 2) Sorry if I'm stating the obvious but you're not responsible for preparing the 1099-R, Plan A does that and sends you a copy which you use to correctly file your tax return (see instructions for lines 16a & 16b of Form 1040).

But he can avoid next year's MRD if he rolls before year end after taking the MRD for this year.

30 days

I come from corporate benefits administration and have earned both CEBS and SPHR, so sorry if I come off defensive at all w/ this but... I'd correct that to: CEBS is a broad benefits certification that includes group insurance and compensation in addition to retirement plans. It generally serves a different different customer base that the other designations listed. To the OP: You mention that you're an atty... If you intend to stay in the ERISA and benefits arena, then exposure to the knowledge contained in the CEBS could be useful. The three key areas of group, retirement and comp are all areas that require a competent atty to consult and advise. So I would answer your question w/ a question: where do you want to go from here?

Which is also to say: the imputed income rules exist in a different part of the Code from the change in status rules.

Plenty of companies w/ presence in Puerto Rico have US operations/connections such that they can maintain a US IRA. In addition to asking whether mandatory 20% withholding applies, you need to ask what the tax consequence is of trying to "rollover" from a US plan to a PR IRA. And the answer is that everything I'm seeing in google searches says it counts as a distribution subject to tax and early withdrawal penalty and then a contribution subject to PR IRA contribution limits. The person should talk to a competent professional tax advisor for both US and PR taxes. As to the 20% withholding, the US code is in section 3405 and the regs are in section 31.3405 if you're inclined to research it. http://www.irs.gov/taxpros/article/0,,id=98137,00.html Also see IRS Pub 15-A Chapter 8 http://www.irs.gov/pub/irs-pdf/p15a.pdf