FormsRstillmylife

The Plan Administrator's loan policy can be set forth in the service agreement, but the summary plan description should either be updated or have an addendum setting forth all those points you listed. We have a Plan level policy that is too detailed for the participants and then a simplified participant-friendly version inserted in the SPD.

I have some ancient notes as to why our volume submitter document limits nondeductible employee contributions to 10% of compensation. 10% limit on voluntary nondeductible employee contributions Regulation section 1.219(a)-5©(1)(ii) as proposed 1/23/1984 © Rules for plans accepting qualified voluntary employee contributions (1) Plan provision, etc (ii) If the plan document provides for the acceptance of voluntary contributions, but does not specifically provide for acceptance of qualified voluntary employee contributions, the plan qualification limitation on voluntary contributions (the limit of 10 percent of the employee's cumulative compensation less prior voluntary contributions) would apply to both qualified voluntary employee contributions and other voluntary contributions. On the other hand, if the plan document provides for acceptance of both qualified voluntary employee contributions and other voluntary contributions, the plan qualification limitation on voluntary contributions would apply only to the contributions other than the qualified voluntary employee contributions. The proposed 415 regulations that will be effective 1/1/2007 refer to the 10% limitation in examples but do not actually state the rule. The status of this limitation is very unclear. As reflected in Notice 82-13 and Notice 83-11, voluntary nondeductible employee contributions were subject to a 10% of compensation limitation. With the adoption of the ADP/ACP testing for elective deferral, voluntary nondeductible employee contributions, and matching contributions, the reference material ceases to refer to any other dollar or percentage limitation for these contributions. However, employee contributions continue to be an item included in annual additions under 415; therefore, before EGTRRA voluntary nondeductible employee contributions are subject to a 25% of compensation limitation. Since employer contributions to profit sharing plans before EGTRRA are limited to 15% of compensation, the CMS, Inc. volume submitter document retained the 10% of compensation limitation for voluntary nondeductible employee contributions in order to prevent these contributions from restricting employer deductible contributions. I have not reviewed the impact of the EGTRRA 404 and 415 changes on our document restriction, nor have I reviewed the impact of the Roth employer plan provisions of EGTRRA on voluntary nondeductible employee contributions. CB-NOTICE, PEN-RUL ¶17,099K, Notice 82-13, I.R.B. 1982-19, 16., Economic Recovery Tax Act I-15. Q. Is the limitation on voluntary employee contributions to a qualified plan of 10 percent of an employee’s compensation reduced by the amount of DECs? A. No. The 10-percent limitation applies to non-deductible contributions only, not to DECs. Therefore, a plan which provides for DECs may also provide for voluntary nondeductible employee contributions of up to 10 percent of compensation. CB-NOTICE, PEN-RUL ¶17,099U, Notice 83-11, I.R.B. 1983-30, 22., Contributions and benefits: Limitations: Guidelines: TEFRA amendments. Effective on January 1, 1986, and each January 1 thereafter, the $90,000 limitation above will be automatically adjusted to the new dollar limitation determined by the Commissioner of Internal Revenue for that calendar year. The new limitation will apply to Limitation Years ending within the calendar year of the adjustment. Employee Contributions: If a participant makes nondeductible employee contributions under the terms of this plan, in no event may the lesser of (a) or (b) exceed the lesser of (i) $7,500, or (ii) 10 percent of the participant’s compensation for any Limitation Year. For purposes of the preceding sentence (a) is the amount of nondeductible employee contributions in excess of 6 percent of the participant’s compensation for any Limitation Year, and (b) is one-half of such employee contributions.

So, you don't file for VCP and file your plan for its next cycle determination letter. You have to disclose that there is this merged plan. The IRS reviewer says send everything back to when the merged plan had its own determination letter. Welcome to Audit CAP based on your entire plan, not just Target.

An actuary will explain to me what I am missing, but I would think you could treat the current benefit as a monthly pension at the current dollar amount as of his current age with its remaining guaranteed period plus life and convert that to a lump sum present value. This lump sum can then be converted to the other pension options that must be offered. If I were trying to convert to just another form of pension, I would consider going back to when the pension started (and each improved value segment) to get the QJSA, etc. and then subtract the benefit already received.

After the demise of DOMA and the Supreme Court reasoning behind it, ERISA cannot define spouse. If California law says this is the "spouse" and federal law cannot define "spouse," the employer's plan cannot cover "spouses," but exclude same-sex spouses. The plan could cover dependents and non-dependents living in the residence who are of the opposite sex of the employee. There will be a lawsuit.

We will administer these -- www.conradsiegel.com

The volume submitter is required to file a 5307 with the next round of restatements. Even if there is no other variation, EPCRS self correction requires this later filing.

We inserted a provision into our documents that provides for a lump sum under these circumstances, subject of course to AFTAP funding level.

But you do not rerun the test after you have done the required corrective distributions. The required corrections do not necessarily cause the plan to pass. Or did you have bad data and need to run with correct data?

I agree, generally. Voluntary and mandatory contributions are annual additions as under a defined contribution plan; thus, they are not a 415 problem for a defined benefit plan. Mandatory contributions could be sticky depending upon the sort of government plan you are working with. Government employees often have contractual rights to a retirement plan. If the contract did not say mandatory contributions, they are not happening. Voluntary is the real option, but he will not like the after-tax treatment. You could also explore 457(b), not as secure for the employee, but perhaps more desirable for the employer.

An employer does not have to certify HIPAA compliance to have pure enrollment information. This is the one thing an employer is allowed to know when it is not going to be otherwise involved with a plan. To avoid any argument, could the data be sent straight to CMS on the employer's behalf?

What did the IRS say when it ruled abusive tax shelter? Did it disqualify the plan? Did it rule the insurance product excess funding?

If you copied your document correctly, it specifically authorizes distributions to an alternate payee before earliest retirement age. If the order says to distribute now, your document says you can -- just as soon as the distribution paperwork is completed. The alternate payee may have better income tax results if she/he waits until 59 1/2, but that does not prevent the person from electing a current distribution. IF the QDRO provides that the alternate payee can exercise rights under the Plan like a participant, the alternate payee could take a loan. There is no clear guidance on hardship -- your plan will tell you that if the participant, spouse, dependent, or primary beneficiary suffer such and such hardship, a distribution can be taken. The alternate payee is none of these people, but can you treat one as if he/she were the participant for this purpose? The 401(k) regulation does not say so. It is silent. The more twisted question is whether the alternate payee can take a hardship withdrawal if the participant (or the new spouse) has a qualifying hardship.

You also must do 401(a)(4) testing. Actually all matching contributions are subject to this, but generally the allocation formula addresses the issue. See Regulation section 1.401(m)-1(a)((1)(ii). I believe you can justify the comp to comp formula as constituting one level of matching contribution. (ii)Testing benefits, rights and features.— A plan that provides for employee contributions or matching contributions must satisfy the requirements of section 401(a)(4) relating to benefits, rights and features in addition to the requirement regarding amounts described in paragraph (a)(1)(i) of this section. For example, the right to make each level of employee contributions and the right to each level of matching contributions under the plan are benefits, rights or features subject to the requirements of section 401(a)(4). See §1.401(a)(4)-4(e)(3)(i) and (iii)(F) through (G).

Would it not be a comfort if the 125 regulations addressed this type of family status change? There are clear rules for spouse obtaining a job status change, but nothing about a dependent having a job status change. We just fielded a request to drop coverage because the parents are "mad" at the twenty something. Could not find that anywhere in the law.

Would not this put this account under the non-ESOP stock diversification rules? The 55 and 10 ESOP diversification rules are bother enough without this additional layer.

Conrad Siegel Actuaries at conradsiegel.com has a volume submitter DB document. We are an actuarial firm and provide full services to DB plans, but you could buy just the document. Did I mention we have an independent investment advisor?

As a non-profit, the church plan would be subject to 457(f).

Excess funds cannot pass through the plan beneficiary designation. Refund to the estate under the deceased's social Security number. Otherwise you are setting the beneficiary up to contaminate an inherited IRA.

My favorite part of this antiquated law is that if I add a death benefit for a nonspouse, the annuity must start by December 31 of the year following the year of death. Meanwhile, since 401(a)(9) lets a spouse delay until the participant would attain age 70 1/2, there is nothing in 401(a)(9) to overcome the earliest retirement age rule of REA. There are documents out there that never address this conflicting time of payment; they just add a nonspouse death benefit clause and leave the REA earliest retirement age language standing for the spouse.

The 401(a)(9) regulations no longer require that will and trust documents be submitted with a beneficiary designation of the beneficiaries under a will or trust. Instead, a plan is permitted to treat as the "designated beneficiary" the persons identified under the terms of the will or trust in effect at the time of death as long as those persons are identified by September 30 of the year following the year of death. We have been known to advise the plan administrator in the described situation to pay the 2 children 50/50 per the terms of the will since they have been clearly identified as the beneficiaries of the estate named in the plan forms. This gives the recipients the ability to transfer funds into inherited IRAs rather than receive fully taxable lump sums. This also avoids the whole state probate law issue. You pay under the terms of the plan (as interpreted under the 401(a)(9) regulations).

First off, you must determine whether this program is a plan covered by ERISA. Since there is no employer contribution and there are 7 vendors, this sounds like it may not be an ERISA plan. If a 5500 is being filed, then it has been determined that it is an ERISA plan. If the program is not subject to ERISA, the vendors are subject to SEC disclosure requirements to the account holders (participants). The ERISA disclosure requirements do not apply. If this is an ERISA plan, then the ERISA disclosure requirements apply in the same way they would to a 401(k).

Check out conradsiegel.com -- I might be employed there and be prejudiced, but it is a good actuarial company with a health and welfare benefits department.

The change in carrier charge could be recognized for the prospective months.

Have you reviewed the rules governing the reporting of tax shelters to the IRS? Contribution deductions for a disqualified/non-existent DB plan over a prolonged period subject to fraud statute of limitations. TPA owner needs an attorney and he needs to un-involve his employees with this albatross.