IRA

I think you should advise them of the probability of being caught on audit - quantify it as a percentage - and multiply that percentage by the cost of the penalties, interest, fees, etc. if they do get caught. Compare that to the cost of correction. Then advise them to go with the cheaper alternative. Make sure you put your advice in writing and let your client know, in writing, that they can rely on your written advice to avoid IRS penalties.

We have a non-amender Cycle E plan. We plan to file VCP and 5300 simultaneously. We plan to send original VCP application to the D.C. address with a copy of the 5300 application, and send the original 5300 application with a copy of the VCP to Covington, KY. Where do we send the $1,000 check for the 5300? The VCP D.C. address or the Covington, KY address? Anyone know how to do this? Never mind everyone. I figured it out. The answer is in the Rev. Proc.

How has this worked out for you?

The DOL has stated unequivocally that you can't just post the SPD on your intranet or the internet and satisfy the SPD disclosure requirement. You must "furnish" the SPD to participants. You can't just post it on a bulletin board, and you can't just post it on the internet/intranet. If your consultant says you can, get a new consultant.

So what's the deal with the SSA? I know the reporting has been delayed, but what statement do we need to give participants that includes the SSA information? Is this statement still required even though we don't file the SSA?

Yes. Thank you.

Does anyone have a link to the old IRS Tax Savers Credit Notice that was in Spanish?

Our client has a 401(k) with a GIC. They want to terminate the plan. How do you terminate and distribute with the GIC held in the 401(k)? Any ideas, comments, experiences, suggestions, traps for the unwary?

No options in either amendment. This is a terminating plan. It may be that the termination department of the vendor has not yet talked with the plan upkeep department.

Yeah Baby!

Unless it is too burdensome or you have a need for confidentiality, or a similar circumstance, I would think you would want to tell participants what is going to happen to their plan, regardless of the Internal Revenue Code requirements.

What is the PPA remedial amendment period for an employer to adopt the adoption agreement of a prototype sponsor that adopted a PPA interim amendment onto its EGTRRA restatement? The vendor is telling my client they need to adopt its own PPA amendment even though they adopted an interim amendment on behalf of all plans. It seems to me if my client has to do that now, it is too late. Rather, it seems to me that the interim amendment covers it. Prototypes don't have a PPA RAP that is different from 12/31/09 do they? Thanks.

I still say the numbers of the radical fraction involved are imaginary.

Can a 401(k) plan exclude 1 HCE but allow all others to participate?

There are numbers of imaginary reports like this. Rather than worry about things like this, I prefer to sit on my log and tap out the rhythm.

This question is actually a little more interesting than it first seems. It is not a matter of depriving a court of jurisdiction. It is a matter of venue. Courts often uphold choice of venue clauses. Usually venue clauses refer to the state in which the action is brought (whether it be state court or federal court). I have not researched whether a court choice of venue clause works where state and federal courts have concurrent jurisdiction. Take, for example, arbitration. A plan can include a mandatory arbirtration clause - absent the what-I-think-are-invalid DOL claim regulations that prohibit them, but even those don't apply to all plans. If the plan can compel arbitration, why can't it compel a state court venue? I realize the FAA allows arbitration, but assume a court choice of venue clause is otherwise valid? I guess arguably under the claims regulations that could be invalid. After all, Congress passed ERISA to give participant's access to federal court. I don't know the answer, but these are my quick thoughts. What state are you in any way? Most plans want to be in federal court. Your plan should too. For example, do you know for sure that the federal rules of discovery under ERISA will apply in your state court? Believe me, the plan wants those federal rules of procedure. But there is no guaranty that reverse-Erie would apply.

For non-benefit obligations, plans can rely on state-law statutes of limitations - though they can't set their own.

What if the sponsor purchases the insurance? Do you check 9a(1)? Does it matter whether the insured is the sponsor and not the plan?

Monday, February 2, 2009. Got it. Thanks.

Is the Cycle C deadline to file an application (e.g., postmarked with the post office) this Saturday or next Monday?

True or False: Any qualified benefit offered through a cafeteria plan is automatically an ERISA plan because in order for contributions to the plan (in which the qualified benefits are offered) to be excluded from income under IRC Section 106, the plan must be "employer-provided." Thus, even if an employer tries to fall within the ERISA safe harbor (e.g., payroll deductions only and no endorsement, etc.), the very fact that the plan is offered through a cafeteria plan means the plan is "employer provided" and thus an ERISA plan. If true, why? If false, why?

I am having one of those moments so this may seem like a stupid question. Does an FSA have to satisfy both the discrimination rules of 125 and the discrimination rules of 105(h)? For example, a person could be highly compensated under the new 125 proposed regs, but not under 105(h), and vice versa.

Ah, I couldn't find the notice on the IRS's website. This is much better coming from the IRS's website rather than benefitslink. Not that I don't trust benefitslink - it is just that it isn't official.

How does anyone know this notice is valid?

I agree with QDROphile on all counts here. Somebody should be paying him well for this advice.