Kimberly S

Ours has a 2005 copyright date.

And do your clients actually do that rather than running to you for documents any time they are audited?

Have new regulations or situations changed any of your opinions on this topic in the past few years?

Who knew that the angelic looking kitten was masking a mercenary?

I believe that it is technically up to the participant, not the TPA, to make sure that he or she actually took the required minimum distribution somewhere, but we all know how likely that is to happen correctly. You might start by asking the participants if they took the RMD after the transfer. For those that did, you may not need to do anything else. Correcting a 1099-R that acurately reflects what happened to something that shows what you wish had happened is not an appropriate action.

And while you're amending you could change to current year testing for 2008.

I've never heard that. We write start up plans with a Safe Harbor Match all the time.

All of these are excellent suggestions. Keep in mind, however, if each employees last raise was less than or close to the amount of the premium they are now going to have to pay each month, there will still be hostility over the issue. One of my former employers found themselves in a similar situation some years ago. They alerted employees in advance that they would be requiring employees to pay 25% of the dependent coverage right away, 50% the next year, 75% the third year and eventually 100%. The intention was to allow people to plan and avoid surprises. The result was to cause tremendous anguish over the fact that employees would be seeing falling take home pay for the next several years.

Isn't one of the requirements to qualify for a hardship that they have to have already taken any available loans both from the plan and other sources?

On my first TPA, the notice was provided by the independent attorney who restated the documents with the dates to be completed by the financial people or employer after consulting with them. On my current job with a bundled service provider, the notice is provided by the TPA area of the business for incoming plans. We also provide a sample notice to all outgoing plans as a reminder that it needs to be done.

What does the document say?

Is this truly a partial distribution -- or a total distriabution that is only partially rolled over? I think the reg you're looking for is taking about someone taking a partial distribution.

That ship has sailed. I generally agree, but with the potential late filing penalties triggered by filing a 1099 now, I'd be more inclined to let sleeping dogs lie until someone proved that it was NOT filed years ago.

Why not ask the delivery service that "lost" the form to make good on it?

My theory is that the instructions don't address it yet because Roth contributions have not yet been permitted for 5 years. Until 2011 the presumption is that no Roth distributions from 401(k) plans are qualified.

When we ran into this recently we required the HCE to repay the distribution.

We require the participants to make their own elections instead of mapping.

It was 2007. 2008 W-2s have not yet been issued.

Client has contacted us about how to correct their error. About 15 participants elected Roth deferrals, but the client's payroll provider withheld pretax deferrals for them instead. The funds are showing as Roth with the custodian, but were reported as pretax on the W-2s. At this point, do you fix the W-2s or move the money from Roth to pre-tax with the recordkeeper? I can see pros and cons either way, so I'd love to know what others are doing in this situation.

The gateway requirements are the hoops you must jump through to get to the general test.

It may not be the preferred method for plan design, but if the primary sales force for your new plans is brokers, you sure don't want to exclude them from the process.

I agree, but with managers who are more concerned about scaring away clients than what might happen if/when the governement auditors come calling, that doesn't sell well.

This topic makes me grumpy too! And I am also disappointed that ASPPA doesn't have some clear guidance on the issue. Working in the mutual fund world where management has little interest and less understanding of these issues, we are often pushed to make decisions and advise clients about things that should be handled by ERISA attorneys. It's very frustrating that there is no definitive answer that can be used to demonstrate why we should not be determining things like whether or not 2 companies comprise an affiliated service group based on a facts and circumstances test when we only know the names of the companies and that they have some common ownership. Any authorities that could be referenced would be helpful.

It is an old question that continues to be an issue with small employers who often think they can do whatever they want. If the partner did not end up with sufficient income to support the deferrals deposited, it is not difficult to make the jump to saying the money was actually a deposit of employer money. If the partner had plenty of income and a deferral election on file that matches the amount deposited, it seems to be a riskier leap. This is a good example of why partners and sole proprietors should refrain from making deposits until their income for the year is known.

It all depends on how your allocation groups are structured. I've seen plans that have each HCE in a allocation separate group and NHCEs divided into 4 groups depending on whether or not they were employed on the last day of the plan year and whether they worked more or less than a specific number of hours. In that situation it was often possible to give a zero allocation to one or sometimes more entire NHCE groups and still pass.