movedon

This is more of an issue to me than some of the other situations mentioned. I expect that broker's have relationships with tpa's and if a broker sells a product to a client of ours he may try to steer the tpa business to the party with whom he has a relationship. I do not expect that investment companies with whom we work will try to move our clients to a bundled product. Exactly.

Ugh. Why is there an SPD at all if the plan is trying to be non-ERISA?

spam

And, just maybe, employees actually recognize SS as one tax they personally directly benefit from, so maybe they care a little less about avoiding it. OK, probably not.

I wouldn't necessarily think making the sh contribution now as a corrective contribution would cause any 415 problems. I think since the contribution would be corrective, it would be a 415 addition for the year the correction applies to, not to the current or prior (if you're inside the previous year's 415 crediting deadline) year. Otherwise, as usual, I agree with Bird.

Always my personal favorite.

Well mjb, I've read enough of your posts around here over the years to know you probably know what you're talking about, but you kind of lost me with that post. I get that any non-profit employer with an ERISA 403(b) plan could allow the employee deferrals to go to a separate non-ERISA 403(b) plan, but I'm struggling to see why that would benefit anyone much. From the employer's perspective, they still have one ERISA 403(b) plan and all the ramifications of that - good and bad. From the employees's perspective, they now have two plans instead of one, but most of their rights are the same in any event. They give up the protections of ERISA in the non-ERISA plan, perhaps in exchange for a little bit of flexibility with regard to certain ERISA requirements like spousal consent. But what do these plan design issues have to do with the RA/SRA contract design? An employer can choose to have one or two plans, can avoid ERISA as to a deferral-only plan, can have different distribution options for different contribution sources... all regardless of TIAA CREFs product design. What value does the RA/SRA "silliness" add versus a single contract?

I've seen it, too - the exact scenario you describe. I've taken over the document services for a couple clients set up like this at TIAA CREF. I viewed the arrangement as two separate 403(b) plans and then merged them into one - on my document, not on anything provided by TIAA CREF or BISYS. I was on the fence about whether the previous deferral-only plan had ever been an ERISA plan and ever needed a 5500 of it's own, but since one had been filed previously, I advised the client to file a final one for that "plan" reflecting the merger. When it was all over, there was one plan, one document, one 5500 - as, in my opinion, there should have been all along. Good luck getting TIAA CREF to set this up any way other than the way they normally do it - on the plan documents they provide or on their administrative systems. The clients whose documents I've "fixed" that were in this situation still have to translate everything into "RA" and "SRA" when communicating anything to TIAA CREF. Silliness.

I've had problems with American Funds. If my client has their assets at AF, I consider that client at risk for a "bundled" pitch.

I believe that if it is an ERISA plan, it is subject to the bond requirements.

Spam.

No experience, but I think it makes sense. Let us know how it goes.

Well, I also hate the DH, inter-league play and instant replay, but I hate bad calls a smidge more than I hate instant replay. Dang it, I said I was going to resist. I think the inability to overturn a blatant bad call really calls the whole game's credibility into question. That would make someone question whether or not they want to watch. EDIT for typo

*lippy struggling to resist temptation to argue about baseball rules, instant replay, slippery slopes, etc. on BenefitsLink...* It's just wrong I tells ya'! I bet some smart people could come up with a fair way to overturn that call within the current rules or with a new very limited rule regarding egregious results of wrong calls. Come one, let's get behind this!

Sieve, I think you're being a little too generous here. The runner was out, and it wasn't close. The call should be overturned.

I believe that is right.

I think Bird's point (correct me if I'm wrong, Bird) is that the ADP refund also corrects the 402(g) excess. I believe this is correct and the IRS ('cause they usually do things right) would also see the 1099, and it would all make perfect sense to them. edited for typo

I've been known to let restating it slide if they're fee-sensitive and don't mind flying without a letter for a few years. But yeah, they need to sign amendments - I can't amend my competitor's prototype on behalf of my new client.

Correction to my post # 19 above - I just learned (re-learned?) that no contributions (not just deferrals) on behalf of an employee to a 403(b) plan are considered in the ABT for a 401(a) qualified plan when testing the 401(a) plan for coverage (1.410(b)-7(f)). I would assume that extends to the use of ABT under 401(a)(4) testing as well. On the other hand, if you're ABT testing the 403(b) plan, you may (or must? I'm not sure which, but I like the sound of may) consider the 401(a). But you still don't include the 403(b) deferrals in the ABT.

I don't have any experience with it, but I'll take a stab. I'm thinking the anti-alienation exception for IRS levies doesn't give a participant the right to voluntarily withdraw money (at all, with or without penalty) or give the plan sponsor the right to distribute money without a judgment or demand of some kind from the IRS or a court. I think the agent is incompetent or the client is dishonest.

Sole prop files his 2009 1040 in February 2010, taking qualified plan deduction for 2009, planning to make contribution by April 15. On March 24, he decides he wants more time to make the contribution. Can he file for an extension before April 15 even though the 1040 is already filed?

That's the cite - thank you Belgarath.

One note of clarification - I think contributions to the 403(b) plan other than elective deferrals would be included in the ABT.

Tom beat me to it. That's the Q&A I mentioned (although the footnote says Q&A 9 - don't know if that's a typo or if that one addresses it, too).

The 415 bit is on pp. 1.899-900 of the 2008 EOB. The ABT footnote is not in there - it was added in the 2009 book. Come to think of it, I first met this issue before the 2009 books were out, and I recall the older books weren't very helpful. I did some research elsewhere and determined that while the issue was unclear, the case that 403(b) deferrals are never included in a 410(b) or 401(a)(4) test was more convincing. Then the 2009 books came out with the footnote that supports that position. The footnote refers to an IRS comment at the 2008 ASPA conference. If I can find my research and it's not copyrighted material, I'll post it. Won't be today though because I have some very urgent business to tend (yeah, I have to get to the liquor store and back before basketball starts). Maybe one of the real 403(b) experts (i.e., not me) on these boards will chime in with some enlightenment. Were's John Simmons?