david rigby

Strongly agree with comments about avoiding insurance as the primary funding mechanism for the plan. When you engage an actuary, select one (or more) who has experience similar to your situation (ie, small plans). The properly experienced actuary will also be able to recommend 2 or 3 similarly experienced attorneys that you might consider. Your actuary will guide you in discussing what death benefit to include in the plan. The answer to that might require the plan to include some life insurance as part of its investment, but not the main mechanism for funding (ie, the death benefit is ancillary to the main purpose of the plan, which is to save money for retirement). BTW, you are almost a prime candidate for a DB plan (a "prime" candidate is just a few years older than you), so your exploration of this option is very good.

Don't assume a Distress Termination is available. Review the definition and you will liberal use of the word "bankruptcy".

Don't forget the high-25 limitation.

To be precise, the law does not prevent discrimination, but places limits on it. Again, this is what pension law thinks of the fairness concept.

Congress has intent?

Often, the definition is closer to W-2 plus (both 401k and 125) deferrals. May also exclude "fringe benefit costs" normally included in W-2, such as imputed value of life insurance.

IRS Notice 2013-11, released 02/11/2013 http://www.irs.gov/pub/irs-drop/n-13-11.pdf

Let's not forget about the future explosion in healthcare costs. While some people continue to believe the "Affordable Care Act" (if ever there was a misleading title, that's it), those people don't live in the real world. The tax dollars needed to pay for the healthcare promises will grow dramatically; Congress will look at the "tax spending" of qualified plans. Most likely, the first change will be lower deductions. Remember how most employees saw decreases in benefits when the 1993 changes restricted a few (ie, the decision-makers)? Secondly, they will seek ways to tax more of the build-up of QP assets. Eventually, they will wake up and stop the growth of tax-free accumulation in Roth IRAs.

First, does the plan define the death benefit as PVAB? any alternative forms of distribution? But, more to the point, does the plan answer your quesiton?

Agreed, but I suggest the reduction in contributions will be two-sided: both EE and ER.

Isn't "Plan Year" the important thing here?

Also check to see if the plan has any provision that will permit an actuarial equivalent lump sum of these remaining payments.

What's your point?

The owner wants to delay his taxation as long as possible. The IRS (and by extension, those of us who are taxpayers) want him to pay taxes on the amounts that have previously been tax-deferred. It's time to buck up, and pay up.

Working or not, most periodic distributions are not eligible for rollover. As stated above, "...Congress expects you to take taxable distributions."

If at NRA and 100%, it may make sense to commence annuity distribution (especially if NRA = 62).

Unless they make payments directly to participants, why would an investment house/brokerage EVER need SSN's of participants? Perhaps they really want the EIN/PN for the plan?

Data as of 31-Jan-2013 Moody's Daily Long-term Corporate Bond Yield Averages Utilities Industrial Corporate Aaa NA 3.90 3.90 Aa 3.98 3.94 3.96 A 4.20 4.24 4.22 Baa 4.75 4.93 4.84 Avg 4.31 4.25 4.28 Moody's Daily Treasury Yield Averages Short-Term (3-5 yrs) 0.58 Medium-Term (5-10 yrs) 1.39 Long-Term (10+ yrs) 2.71

If the "investment house" is not familiar with institutional/qualified plans, keep moving.

No matter what resolution, make sure you consider the future: what do you need to do to make sure this does not happen again?

Not if it's an ERISA plan. But, it can be amended to limit the number of years of service (for example, 30) included in the benefit formula.

There have been a few prior discussions on this topic. As I recall, at least one of them had a reasonable suggestion. Try using the Search function. Suggested key words include embezzle, embezzlement, embezzled, theft, etc.

I'm shocked. Shocked!

Very likely, the use of "retirement" refers to an event, not an eligibility.

Does anything trump 415?