FormsRstillmylife

Does the custodian have contractual authority to file the 1099R? If it files the 1099R's per direction from someone else per its service contract, it can notify that person and await instruction. Generally, a custodian is at least a full step down from a directed trustee. Per its service contract, there should be no authority or ability to act in the absence of direction from the trustee or plan administrator; therefore, there should be no legal liability to act. In theory, it lacks sufficient information to act, the trustee could be depositing loan repayments in another account held by the trust.

The election form would tell the participant the length of the election period - 30 to 90 days. The plan then has a reasonable period to process the election; so, a 90-day election period can mean say 90 + 10 days. What is the real issue? Illiquid assets and a large lump sum could support a longer time. The plan fiduciaries have a duty to the remaining participants to sell assets at a reasonable market price. Stalling until the QDRO arrives is a whole other issue.

I don't think you could find a court case. The point of concern I would have is your ability to practice before the IRS. If the IRS ever learns that your firm knowingly prepares false 5500s, how long would the IRS continue to permit your firm to prepare 5500s? If your firm is known to commit perjury, how long would the IRS let it make VCR filings for clients? This falls under Circular 230 and the IRS's power to police who can practice before it. I don't know how or when the IRS would learn of these practices, but the consequences make you pause.

Of course, it depends upon the terms of the plan document, but generally the document is not that specific. Most of the plans we administer will partition the Alternate Payee's benefit into its own pension subject to life or guaranteed period and life distribution pursuant to the AP's election. This leaves the Participant free to elect QJSA based on the remaining pension and provide for the current spouse. Splitting the pension check between the parties is reserved for divorces that occur after distribution has commenced. In such a case, the Alternate Payee is normally awarded the full survivor pension and there is nothing left for a second spouse.

Your ERISA attorney may recommend that you file with the IRS voluntary compliance program like a non-amender. The IRS has been known to accept the history of plan administration as evidence of the intent to maintain a qualified plan and permit a current plan signature (with payment of compliance fee).

We looked at this question and concluded that the activity necessary to identify the catchup contribution did not constitute an ADP failure. Once the catchup contribution was properly identified and removed, the ADP passed. Thus, elective deferrals could be shifted to the ACP.

In light of the regulations requiring separate account tracking for tax and withdrawal rights purposes, will you be recommending that your clients not offer or remove hardship withdrawal and loans for Roth 401(k) accounts? Do you think there is a nondiscriminatory feature issue if regular 401(k) elective deferrals can be accessed by hardship withdrawal and loans, but the Roth 401(k) account cannot?

An FSA is not just subject to family status change rights but is also subject to HIPAA special enrollment rights as a group health plan. Under the special enrollment right for birth, adoption, or placement for adoption of a child, the election change is required to be retroactive to the date of birth, adoption, or placement for adoption if the Plan Administrator receives the election within 30 days of such event. Proposed HIPAA regulations not yet effective would only require an employee to give notice within 30 days of the birth and then grant a reasonable time thereafter to complete the forms and STILL get retroactive coverage to date of birth.

Good question! The regulations are effective for the 2006 plan year; so, Option 1: They are not effective for the safe harbor notice, because it is still 2005. Option 2: They are effective for the safe harbor notice, because it is being issued for the 2006 plan year.