masteff

First off, the same desk rule (even as it was revised by EGTRRA) prevents D's employees from taking money out of Plan D. D employees never had a separation from service. A "frozen" plan absolutely CAN exist. At my previous job, we had two of them resulting from corporate acquisitions; they passed full IRS and DOL audits. As QDRO's last post notes, you have vesting and a few other issues that should be dealt w/ via plan amendment(s) at the time of the M&A.

First, I assume your usage of "temp" really means terminated employee who is now working via a third-party agency. (If you mean "part-time" then please clarify as that's very different than "temp".) So the issue isn't regular vs temp... the issue is regular vs terminated. 1) what does your plan say happens w/ loans after termination? Are they due in full w/in a certain time limit or can the participant continue to make payments? 2) the participant is no longer on payroll, so if they are allowed to make payments, then you have to provide a coupon book or otherwise accomodate how she is to make payments. (if the person is still on payroll, then she's not a "temp" by definition and you'll need to clarify.)

Certainly, the attorneys in this discussion thread will have more insight than I, but it seems the PA should look to the plan's terms, and possibly administrative interpretations that provide precedent, to determine the proper beneficiary. Is there a reason that a court order would precede the PA's determination? Also be careful of whose court order it it.... the consensus above is the account became the daughter's even if the transfer had not yet occurred. So a court order on behalf of the worker has no power. And david rigby may also be alluding to ERISA preemption, which could also make the order moot.

Just as a suggestion for keywords to look for in your text... ours used the term "restricted participant" to refer to benes, alt payees and ee's w/ rollover prior to eligibility. It went on to explain that restricted particpants have the rights of participants w/ the exception of making or receiving contributions. This meant sections such as the one quoted, where it "Participant's death", would apply to the bene by virtue of the restricted particpant definition.

But it's not eligible for a CODA because there's no cash element (or if there was, it was in the past).

Just to expand on John's answer... you don't judge if it's in default by current balance vs the amortization schedule balance. You judge it by the timing of the payments. So the ultimate question is... did the payments in quarter B fully cover the payments missed in quarter A? So payments missed in June (quarter A) were potentially made up in September (quarter B); but did Sept fully cover June's missed payments? If not, then the loan is in default. Then do the same for missed payments in July-Sept (quarter A) compared to late payments in Oct-Dec (quarter B).

Of course the LLC option doesn't completely fix one factor in the OP: The death benefit is partially solved by the distribution, except for it being non-cash and therefore payment of taxes could be a problem for the beneficiary. As to the retirees, past discussions on this board make me all the more aware of the problem of MRDs and illiquid IRAs. We ultimately come back to the need for the land to be sold. I might wonder what asking price they have on the land and whether they have it priced above the appraisal in hope of profiting from a speculator or developer buying it. And then I'd have to wonder if that's actually in the best interest of the plan.

Certainly less than the current costs of ERISA compliance.

See also: Chapter 5 of IRS Pub 560: http://www.irs.gov/pub/irs-pdf/p560.pdf They have some handy worksheets that maybe exactly what you're looking for.

In the regs that oriecat gave links to... 204(d) is a something to watch out for in your scenario. Question: The need was documented for the employee to arrive to work at a later time. Was any accessment made of when the employee needs to return home at the end of day to care for the child? Suppose the employee was transferred to the 11am shift, can you state whether or not the employee needs to return home at a specific time which might cut the 11am shift short on a regular basis? If the employee was on the "11am shift" but left at 5pm, would management have the same reaction about the end of the day not being fully staffed as they currently are having about the mornings? Management needs to look past their shifts and quotas and realize the employee was approved for a modified work schedule. They need to let go of the notion that she "should be" starting at 8am but isn't. Are there other positions to which the employee could be temporarily reassigned (w/in the restrictions of the regs)?

Sorry for asking an obvious question but since you mention EPCRS... they've updated that document roughly annually, so it's more useful as an actual tool than it was some years ago... have you checked what the current document says?

IF you can get the signature, yes, absolutely, 100% correct. But that IF can sometimes be a tall order to fill. When you get into large corporations, the number of people you're dealing w/ pretty well guarantees that someone won't return a form. For example, my former employer had 4 plans (2 active, 2 frozen) with nearly 200 MRDs between them (some participants had MRDs from 2 plans). Even with prepaid postage, we'd not get 1/4 to 1/2 of them back.

I had experience w/ a firm that was overly "forms-oriented" but not on MRDs. Thought #1 is escalate your issue at the investment firm to a higher level of management and insist on being on a phone call w/ their legal department. Thought #2 is (w/ the blessing of legal counsel) have the trustee provide the signature (as it's the trustee's duty to run the trust in accordance w/ IRC): "John Doe by Tom Trustee".

You're focusing on the labels for the sources and not content. If I created a source called "masteff's beer money" but I use it to put non-elective contributions into, then that money is non-elective despite my label. Now, if they call it "ESOP" right now, that's a bit misleading ("future ESOP" might be a bit better), but it's still non-elective contributions and your accounting and 5500 work will reflect them as such... until they actually make the amendment and convert to an ESOP. Question: I'm confused between your two posts... are they amending in the future or have they amended for ESOP already?

Your search words are "convert 401(k) to esop"... and the answer is yes, you can. You can also have an ESOP inside a 401(k), so a portion of the money in the plan might be converted to ESOP while the rest remains 401(k) money. Is there any rule against the company using recordkeeping codes to keep this specific company contribution distinguishable from other company contributions? no, there isn't anything wrong w/ it (it's just more recordkeeping work). So the question du jour is not the future ESOP issues but is the amount being contributed to the 401(k) fully allowable and deductible under the current 401(k) and it sounds like you've already answered yes to that.

Code Sec 408(p) describes SIMPLE IRAs. Code Sec 402(g) defines the annual contribution limit; specifically, 402(g)(3)(D) includes elective contributions under 408(p)(2)(A)(i). 402(g)(1)© says the amount excluded from an individual's gross income also includes the "applicable dollar amount" under 414(v)(2)(B)(i). It further says that amount is "without regard to the treatment of the elective deferrals by an applicable employer plan under section 414 (v)" (which, among other impacts, means you ignore the qualifier in 414(v)(2)(B)(i) which applies at the plan level and just take the specific dollar amount from the paragraph). The consequence is a weird disparity between the plans' limits and the individual's limits. An individual SIMPLE IRA can't let you make catch-up of more than $2,500. But you as an individual, using two separate SIMPLE IRA plans (of unrelated employers), can make $2,500 + $2,500 for a total of $5,000. This fits w/ Denise Appleby's answer to the same question here: http://www.investopedia.com/ask/answers/07/SIMPLE_IRA.asp As several posters agreed above, it's extremely important that the companies not be related or else they likely count as one single employer and the limits then apply in aggregate. EDIT: just caught this piece... This gives you a major problem. See my last sentence above.

You'd generally still want some supporting docs for the need itself (copies of medical bills, tuition estimates, etc). But as to the detail of whether an individual qualifies as a dependent, I'm with John's well-phrased answer.

There are other threads discussing that the IRS has a stated rate of return to use (can't remember if it's published or what). Do a search on here for correction interest rate. There was thread that touched on it in the past two weeks if I remember correctly.

On that phrase, I sincerely think you're trying to over-interpret. You can't cross-apply from A1 to A4. A1 gives the basic definition of involutary termination. In A4, the IRS says: in case there's any doubt of our specific intent, we are explicitly telling you that involuntary termination results from an employer action to terminate someone absent for illness or disability (whereas merely being absent isn't enough by itself). If someone is absent for illness or disability, they are involuntarily terminated if and only if the employer takes action to terminate. If the employer does nothing, then no involuntary.

The nuiance between A1 and A4 is the phrases I've underlined. Be careful in reading the part in parentheses.... you're reading it to mean the action must be before the illness/disability. Remove a couple of clauses and re-read it: "mere absence before the employer has taken action is not an involuntary termination." The action by the employer is the triggering event for it to become involuntary termination. Now the questions are: How does your company treat the end of FMLA for health insurance, does the EE stay in or go to COBRA? Do you have any legal reason to not terminate the employee? What impact would action to terminate have on STD and LTD?

Our plans used status code "B" for spouse beneficiaries and "C" for non-spouse beneficiaries. We had a specific field in which we stored the original participant's DOB. This way tax forms and such were properly reported to the beneficiary but we had the info necessary to figure age 70 1/2, etc. Unless you're doing tax forms manually, this is a real consideration.

Try this recent thread: http://benefitslink.com/boards/index.php?showtopic=39758

Is anything being done to terminate the LLC? Is there any reason to NOT terminate the LLC?

I'd say "provided by or on behalf of the employer" but otherwise.... ditto. Fails to meet the definition of a fringe benefit, end of analysis.

That was my thought. Keep in mind that even if the plan text mandates a distribution, it's not an MRD for the participant's individual taxes, meaning the distribution could be rolled over.