masteff

The other search term would be "lost participant".

Sounds like a good plan to me. The main time I anticipate you'll find a mismatch is someone who uses either a PO box or a commercial mailbox (like Mailboxes, Ect.) rather than their residence. But they should be able to easily provide something connecting them to that address (a tax bill would be ideal). I will note that the "representation" referred to above is more likely referring to a written representation. The Service's prior conversations have always referred to written rather than oral representations for hardships.

I'd say... Basis is allocated prorata for purposes of gains. Basis is deferred for purposes of losses. (Meaning you track basis and distributions and, per Pub 590, only recognize a loss when the Roth position is entirely disposed if total distributions are less than total basis.) But this is premised entirely on gains/losses for 401(k) Roth accounts being treated in the same manner as IRAs and Roth IRAs. And having not traced the Code and Regs for how the Roth account cross-references, I could be entirely off base.

Other ideas to consider.... 1) limit the number of PS w/drwls allowed in a year, 2) limit the amount available for PS w/drawals (such as up to 50% of the PS balance on date of w/drwl), and 3) nothing I know of to prevent you from using "hardship" type restrictions on PS money as well (we had a plan that did this w/ a coupld of less restrictive w/drwl reasons for PS money; we tended to refer to "plan hardship" vs "IRS hardship" to denote the difference between PS and deferral monies).

WDIK - the participant probably wants to put the whole loss on the non-rollover money to try to get the full loss now instead of waiting (but see below for why I think he can't). I missed that nuiance... if Roth accounts follow the same framework as Roth IRA's, the answer is no, can't take the loss for current tax purposes. Generally have to completely close out all Roth IRAs and then compare all contributions to all distributions to determine if a loss is available. The partial rollover prevents the loss from being recognizable at this time. And then, it's probably reported as a miscellaneous itemized deduction (which must exceed 2% of AGI before it even has an income tax effect). See page 70 of IRS Pub 590 here: http://www.irs.gov/pub/irs-pdf/p590.pdf

Try searching on keywords {early retirement window}. We offered an early retirement benefit to anyone who terminated under the special program during a certain range of dates. Those people were then able to choose between a lumpsum and a few annuity options; the lumpsum was the normal form of the special benefit (seems like it was years of plan service times either a % of pay or a flat $, can't remember which) and then annuities were calc'd by the actuary. This window benefit was processed separate from the employee's standard benefit under the plan.

QDRO's well put comment is why having your own model QDRO drafts can be a wonderful thing.

I concur, all the items you've added emphasis to are DB relevant verbage that could make a real mess if applied to DC. Send it back.

So this is a DC plan (since a DB plan would have an annuity option already)? You're missing the in-between option... partial distributions that can be taken as needed (of course some nice plan language about "if balance is less than $xxxx then must take entire balance" is nice to keep small balances out of the plan). We had one plan that had an "up to 1/2 of balance" option. Partials are legal to do but you're not mandated to allow it by the code/regs. And if you don't have it then you need an amendment.

Thanks for putting it in better words QDROphile... yep, I know someone who's basically outsourced the whole shootin' match to Fidelity, but the plan sponsor still has 2-3 people in-house w/ enough brains to address problems. One key thing a plan sponsor has is a backdoor into Fidelity leading directly to an dedicated customer service manager whose job it is to sort out this type of mess.

Figured a few people on here might find this interesting... http://www.chron.com/disp/story.mpl/business/6437320.html

If QDROphile is correct that it's Fidelity in question, and if they are being reluctant to remove a hold that should otherwise have expired, then you're best immediate course of action is via the plan sponsor... ie, the company's benefits department. Provide a clear and polite written summary of the facts and law to the plan sponsor and request that they remove or instruct Fidelity to remove the account hold. In areas of ambiguity where they are otherwise reluctant to take action, Fidelity will nearly always defer to written instruction from a client. If the company tries to simply forward your letter to Fidelity then politely escalate w/in the company's benefits/HR structure.

A google search w/ keywords {lyme long term effect} found this article: http://findarticles.com/p/articles/mi_m120...47/ai_16415843/ You could determine what the long term effects are and see if those translate into a change in mortality.

Question to the board at large: is removal or restrictive modification of a hardship reason subject to anti-cutback? So I'm a bit curious as to the concern over this. Having administred 4 plans w/ 1000s of participants, this is more common than we would all like for it to be. The client should review two factors: 1) why do they feel the need to be paternalistic and govern the transaction so closely it can only be used for what the plan sponsor explicitly allowed it for? It's a savings plan, not a spendthrift trust. 2) if you remove the ability to get money in a hardship, how many people will stop putting money into the plan? after all, the main inducement to locking money into a 401(k) is that it can be gotten back out in a limited number of contingencies. same for offering plan loans, main reason to offer them is to overcome the initial fear of losing access to that money. That's not to say you be a party to fraud, but the person had a legitimate reason under the plan and once the money's outside the plan, it's between the participant and IRS.

(who wants to do "real" work while waiting for a 3-day weekend roadtrip, so here's my stab at this...) Webpages tend to just regurgitate facts if they don't actually understand them. "$20 per month" should be "$20 per qualified bicycle commuting month", so there's a qualification issue to it. The way I read the new code section... I'd implement it by taking advantage of the 15-month reimbursement period to let employees apply after year-end for reimbursement. The application would require the employee to specify which months during the preceding year were "qualified bicycle commuting months". That number of months is then multiplied by $20 to arrive at the maximum reimbursement available. The employee would attach expense documentation to the application in order to receive up to the calculated reimbursement max. If you were worried that an employee might forget what months a "substantial portion" of their travel was by bicycle, you could have a monthly or quarterly reporting requirement. Or if you don't mind the added administration, you could also allow someone to bring in a receipt mid-year and be paid out for months earned so far plus $20 per qualified month going forward until properly reimbursed. For example: I ride my bike a substantial portion of Feb and May (so 2 qualified months earned); in June I spend $90 on repairs and submit my receipt; I get $40 now ($20 * my 2 months earned); as I document future months of bike commuting, I'd get up to $20/month until I reached full reimbursement; if I don't ride my bike any more before year end, then I never get reimbursed for the remainder. Or you could wait and see how long it takes to get revised regs.

1) on the main benefitslink.com page, use the "search news" box using: 125 proposed regs. I think this is the current version of them: http://benefitslink.com/taxregs/E7-14827.pdf 2) that link you provided is a rip off ... 20 pages for a mere $99???? go visit a more reputible source like CCH or RIA.

I was waiting for someone like Peter to come thru w/ an excellent answer like that before chiming in that we only ever required a simple declaration from the employee as to the person qualifying as a dependent. You get yourself into a quagmire if you start trying to qualify every aspect of every hardship, especially if you're going past the actual burden of diligence (if you went beyond the basic burden on this one, why didn't you do it on that other one?). Of course it's entirely different if you have actual knowledge to the contrary of the employee's declaration. Oh, I do recall accepting a letter from a medical provider naming the employee as a responsible party for the family member's medical treatment. But seems like the circumstances included the mother living in a nursing home which the employee also paid for, so facts and circumstances do dictate a little on what alternative documentation you might accept.

Reducing base pay to that extreme would result in pure violation of FLSA and minimum wage laws. For it to be "tax advantaged" for the employee, I'd say your only option is to set up a premium-only cafeteria plan and ensure that every similarly situated part-time employee is offered the exact same opportunity. And you're still supposing that a part-time employee can enroll in the insurance coverage... has the employer explicitly reviewed their plan to ensure it allows part-timers? Many fully insured plans have provisions that exclude part-timers.

We need a few more details.... Is this a DC plan? Is the installment election revocable or irrevocable? Is this part of a "series of substantially equal payments" prior to age 59 1/2 (for the exception to the 10% penalty)? Aside from the installment payment election, does the participant have the option to take partial payments as needed w/out restriction? If it's a DC plan, is revocable, is not part of a section 72 "series...", and if the participant can take as needed partial payments, then I'd ignore the missed payment. If it's a DB plan (which generally means it's irrevocable and can't take as needed payments), then I'll let someone better versed in DB plans address the issue.

Having adjusted this sentence for John's Manic Monday.... this is the interpretation that I'd concur with, based predominantly on the grilling we took from the IRS during audit on some wdrwls that met a similar fact pattern. My take on it is that you limit the hardship to the current deferral balance. So to use the numbers in the OP, only the $13,782 could be withdrawn. This would be regardless of the cause for the shortfall (ie losses or mutual fund loads or plan fees or whatever).

John, do you mean loan or hardship?

It's definitional of the tax basis of an asset. See what John said above. It's semi-analogous to a partnership, where a partner pays tax on income that's not distributed, resulting in an increase in basis. (edited to remove the part that John had said just as well as I ended up with).

Of course... in the consultant's possible defense, I once had management who'd construct the question in a way that implied the query came from the consultant but was really their own thought. Then they could take credit if the answer was affirmative or "I'll tell the consultant it can't be done" if the answer was negative.

I'm curious as to what type of consultant and whether you have any idea why it's even being suggested? (I'm hoping the answer is "investment consultant" and "so the assets' gain/loss positions for the next couple years will be in the black instead of the red because of the massive market downturn".... in which case you can say the tactful version of "too bad, so sad".)

Insurance "Explanation of Benefits" (EOBs) generally don't have excess detail about diagnoses but do fully substantiate how much of the expense was not reimbursed and is the responsibility of the employee. My mind goes to two possible directions... the diagnosis is embarassing to the employee (mental health, drug treatment, infertility, etc) or the employee is trying to slide one over on you. As stated above, HIPPA is no excuse for the employee to not provide information to you. But it may require you to protect what you learn... which is exactly what you'd do anyway because as HR/Benefits professionals, we know to maintain the personal information of our employees in a safe and confidential manner. Which is what I'd emphasize to the employee.... "safe and confidential".