masteff

D'oh! that's what happens when you're slow posting and someone gets in before you and you hurry to comment... the joke detector doesn't have time to register!

Thus highlighting "best practices" versus "what's practical". It really comes down to the person who files. It's only short bit of work for a clerk to create a subfolder for each employee and start filing retirement related papers into it. They just have to be trained and understand why it's important (and not just extra work). Large companies just read the entire benefits department into the riot act. With the further expectation of don't look if you don't need to.

Yes, he has to put back all that he got out unless he can show it went to a rollover account without comingling w/ other funds and the balance did actually decline (if it went to an IRA, ask him request a statement for the full life of the IRA, any competent IRA firm can produce this). (or at least that's my interpretation, I could see argument for having to restore the exact dollar amount.) If he does a return rollover of the funds, then you put them into a rollover source where they are eventually taxable. If he restores his account using after tax dollars, then you get stuck having to track after tax basis. http://benefitslink.com/boards/index.php?showtopic=44535 http://benefitslink.com/boards/index.php?showtopic=10381

I can shed some light on this on, having worked eight years for a major corporation in plan administration. It's simple, you keep multiple files... one "master" HR file (kept in the HR dept) and one "master" benefits file (kept in the benefits dept); the benefits file is then subdivided as needed (we subdivided into health/welfare, 401(k) and pension). We would archive the subfolders as appropriate, keeping only the relevant portion in-house, like the accrued pension benefit that's not due to be paid out for another 25 years. A smaller employer might be less rigorous by having just one "master" file but then subdividing into "personnel" and "benefits". Thus allowing the benefits portion to be retained longer for ERISA purposes.

I suspect you're mixing the loan rules into the hardship rules. You only use the loan rule (and the 50% of balance restriction) AT THE TIME THE LOAN IS TAKEN, not for determining a subsequent hardship. 1) Do not include the loan in the amount that can be withdrawn. Hopefully your plan defines the source heirarchy and it was applied correctly at the time of the loan. 2) What does your plan define as the money that can be withdrawn for hardship? Is it only employee deferrals (ie, no company money can be withdrawn)? If so then the most that can be withdrawn is based on the balance in the employee deferrals account. For example, if the employee has $7000 in deferrals, then despite having a balance of $12000 (not including the loan) then the hardship can only be $7000.

IRS Pub 936 "Home Mortgage Interest Deduction", page 2, "Qualified Home" - "A home includes a .... house trailer ... or similar property that has sleeping, cooking and toilet facilities." That last bit used as a key test for many sorts of nontraditional dwellings (think tree houses, caves, missle silos, etc).

Said entirely tongue in cheek.... What does the agent who sold him the insurance say?

http://benefitslink.com/boards/index.php?showtopic=43465 Depends on size of the employer. Medicare has rules to prevent companies w/ 20 or more employees from enticing employees to switch to Medicare. It can get to be a mess fast.

Did the participant have a loan as might generally be required prior to a hardship and could they have merely failed to properly fill out both sets of paperwork and you could now fix that by characterizing $1500 as a loan and setting up loan payments (as it was this month, you're not even late for starting payments)?

http://benefitslink.com/boards/index.php?showtopic=45373 http://benefitslink.com/boards/index.php?showtopic=45119 The presumption is yes, non-drug items will still be allowed as is currently, however there has a been some disagreement over it (part of it being sematics, 106 vs 213). We're all still waiting on better guidance from the Service which will likely arrive in the 11th hour.

The real question is "can" versus "must". "Can" they or "must" they allow the previously accumulated deductible to be credited under the new contract at the new carrier. The fact that you say "most of the partially funded reinsurers as well" tells me that the answer is "can" because apparently a few do not. I stand by what I and BellaVega have said... it's something that's negotiated into the new contract (as opposed to something that "must" be provided under general insurance laws).

BG5150 makes a good point about collections. And following on to my own comment above: What you're initially billed and what you ultimately pay are two entirely different things after copay, coinsurance and out of pocket limits, not to mention insurance negotiated adjustments. Even a brand new bill from yesterday should be rejected if it fails to account for insurance payments and adjustments. Two simple words to him: Prove it. (And if he won't, then don't believe him. He'll have to pay for his new bass boat some other way.) Of course the longer statement to him is the IRS mandates the plan have adequate records to substantiate hardship withdrawals and as such your hands are tied w/out current proof from the medical provider of the amount outstanding. This is the IRS's doing and not yours (the IRS makes an awesome scapegoat for hardship documentation requests and rejections). But if it makes it any easier, he can simply have the medical provider fax a current statement directly to you, which would help keep the process moving.

That is an overly broad question for this board to answer. Why don't you go read up on 401(k)s and come back w/ more specific questions? Here are a few links to get you started: http://en.wikipedia.org/wiki/401(k)#Tax_consequences http://wiki.fool.com/401(k) http://money.cnn.com/magazines/moneymag/money101/lesson23/

Three year old papers are only good if paired w/ current papers showing the balance is still outstanding. And you have to be careful on medical bills because they may not clearly show what's covered by insurance. This is why EOBs (explanation of benefits) are a superior document as hardship support; they specifically state what the patient owes.

Special Tax Notice as provided in IRS Notice 2009-68, specifically the part under "SPECIAL RULES AND OPTIONS / If your payment includes after-tax contributions". http://www.irs.gov/pub/irs-drop/n-09-68.pdf

I concur w/ this answer 100%. Going back to the OP, the plan is likely silent on rehires because I think you'll find the items in question are defined on an annual basis. So, same plan, same year, pick up and carry on from where they left off.

To the best of my knowledge, in a fully-insured plan, the only time deductibles do not reset w/ a mid-year change of carrier is when it's been specifically negotiated with the new carrier.

As a friend said yesterday... the USA is going going Ghana!

Strike the words "I think".... as long as the 1st loan is paid off w/ funds from outside the plan, no matter how temporary, then it is NOT a refinancing.

Telling someone that they would have to pay payroll taxes on this $100 if I gave it to them directly instead of putting it into the plan on their behalf creates the false impression I could choose to simply give them that $100. "Okay, fine, I'll pay the payroll taxes, give me my $100 so I can fix my truck/buy a boat/pay my kid's school tuition." But an employer contribution is not a cash or deferred choice made by the employee. The employee is not an active participant in the choice to avoid the payroll taxes. So it's infinitely better to not misportray that they might have some choice in the matter where they don't. Tax deferral is relevant to put in an SPD because it is solely by special provision of the Code that the employee does not have to immediately recognize the income.

So I'm presuming your broader question is "has there been any guidance yet on how health reform will impact high deductible plans and MERPs?" Not that I've seen but I didn't look for it until you asked. I'm not aware of either being explicitly revoked by the reform bills. This article from SHRM hits some good points on how reform may impact HDHPs. http://www.shrm.org/publications/hrnews/pa...erdirected.aspx

Or if it's a non-spouse bene, have distributions been taken at least annually each year? Generally speaking, it falls under 401(a)(9).

401Chaos, The problem is the words "to prevent foreclosure".... my opinion (and the policy we used at my former job) is you can't "prevent" something until it's actually imminent. That said, it's really easy to get a mortage company to send a past due demand letter once the payment grace period has passed. Heck, most will even fax it if it means they'll get paid faster. Most demand letters include language to effect of "bring your payment current or we'll begin foreclosure proceedings", which we accepted as sufficient threat/risk of foreclosure. Our policy was then to allow w/drwl of past due plus two months forward (plus tax gross up). Note that before allowing a subsequent hardship, it has to be for a month not provided for in an earlier hardship withdrawal (ie not part of the prior "two months forward").

If the plan is silent, then no, no limit. It's not unlikely to see it for something recurring like education or on-going medical treatment.

Is is this an "owner-only" (or owner & spouse) plan or are others covered by it as well? I'm getting at whether ERISA applies or if the bk trustee may have concluded that it's a non-ERISA "owner/spouse-only" plan. If it's an ERISA-protected plan and the bk trustee did this out of simplicity (stupidity) then see Jim Norman's post above.