david rigby

Interesting, have not seen that before, but it's entirely predictable. Here is the IRS-provided link to IRC 4980: https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section4980&num=0&edition=prelim I did not find a corresponding regulation, although there may be some other type of guidance that addresses your situation. There is no discussion on point in the Gray Book, but some other Q&A (e.g., ABA) might include this topic. Maybe @Luke Bailey or @Peter Gulia has a relevant reference? IMHO, the ability to transfer to a QRP, and thereby reflect a reduced excise tax, would NOT be available in your situation. My reasoning is based on the purpose of 4980: to allow the DB plan participants some participation in the "surplus". As you describe it, the QRP appears to be unavailable, but Sec. 4980 also includes another option: applying a portion of the surplus to increase the DB-provided benefit. Thus, the second option is still available; if the sponsor wants the reduced excise tax, then they should use that option. But I might be misinformed.

@Peter Gulia, as best I recall, the creation of Top-Heavy rules (TEFRA, 1982) was the first congressional attempt to quantify the concept of "highly paid". They called it Key Employee. Just a few years later (I think it was TRA86), they created the HCE definition, and greatly expanded its use. Was there a reason? I'm not privy to the discussions behind the scenes, but the 5% threshold was likely a compromise. In like fashion, it's likely the TH threshold of 60% was also a compromise. Students of history will note that TH (and the entire TEFRA legislation) grew out of some significant bad publicity with small (often very small) plans providing 80%-90% of the benefit (and/or account balance) to the owner. This percent increased if the owner's spouse was also covered. Therefore, Congress had to do something! Never mind that the plan design(s) were otherwise "vanilla", and the high percentages were due (almost entirely) to the longer service/employment of the owner. The later HCE creation was in conjunction with a "beefed-up" change in IRC 401(a)(4) and congressional attention to the concept of "non-discrimination". Side note, IMHO, (1) the implementation and use of HCE should have, but did not, alter the use of Key Employee, and (2) congress (and the regulators at DOL and IRS) have done a poor job of coordinating the smorgasbord of statutes and regulations that come under the broad umbrella of "non-discrimination".

Several relevant discussion threads available, using the Search feature above. Good search words will include "property" or "kind" or "in-kind".

Link to IRS reg cited by @Peter Gulia above: https://www.ecfr.gov/current/title-26/section-1.401(a)-20. If the participant in the original post wants to name her child as beneficiary, a divorce is (likely) necessary. But she should also be aware that doing so, followed by a subsequent remarriage, will (again, likely) cause an automatic change in that designation.

A self-employment job? Another job? Money is fungible. If he uses the cash from his NQ payment to fund his IRA, that is not a problem as long as his total IRA contribution falls within any applicable limit.

IMHO (non-lawyer), this is not the correct course of action. The Plan must follow its own document and procedures first (in that order). Eventually, it's possible a court might be involved, but that should not be the default action. Comments from the two attorneys above are spot on.

@Lou S. is correct, but don't overlook the possibility of a mistake in the original statement quoted in the first post above. It happens.

Yes, to all that. Pay close attention to QDROphile's last sentence. Just a bit more clarification: First, you should ask for a copy of the plan's written QDRO procedures. If you don't have an attorney who is very familiar with QDRO rules, keep looking. Usually, the best procedure is to have a draft DRO (typically created by the parties and/or their legal counsel) sent to the Plan sponsor (or some person/organization they designate for administrative purposes). Review of that draft (perhaps more than one) frequently enables small (sometimes large) errors to be corrected, and then a final (court issued) DRO is produced and sent to the plan and/or administrator. It becomes a QDRO only when the plan and/or administrator approves and accepts it. If the plan is sponsored by a governmental agency, such as a state/local government, they will have different (but likely similar) rules. If "your retirement" includes other accounts, such as one or more IRAs, any division will be handled outside of the QDRO process.

Perhaps there is something else behind this question. Note that ERs cannot forbid an EE's attendance for jury service. However, there are some ERs that require the EE to "turn in" the jury service pay, and the ER then pays the full "regular" pay. If this practice (and I don't know how common it may be) somehow found its way to the EE's tax form (W-2) with a distinction for that jury pay, then YES, it is part of W-2 comp, but it might be information only; it would be a good idea to inquire if it is already included in the taxable income already shown on the W-2. I cannot think of a good reason why the ER would want to bother showing it separately; it does not really add useful information and probably creates confusion (e.g., the original question above). Perhaps other readers can offer describe whether this practice is still common, and under what circumstances.

I'm drawing a blank. Can you help me identify the statute and/or reg that describes the Plan Administrator's responsibility to annually advise recipients of periodic distributions (typically, monthly) of their tax-withholding election? Thanks.

Ticker symbol? Could it be "money market"?

As implied, there could be a 411(d)(6) violation in the proposed change. As @CuseFan points out, "It's the plan language that is important here..." so this plan sponsor would benefit from review by ERISA counsel. In addition, this sponsor could benefit from some experienced consulting advice about: the details of the benefit structure within the plan, what minimums and/or maximums could apply, defining the covered group(s), what non-discrimination testing is relevant, how to build in future flexibility, etc. I'm mostly retired, so that advice would not come from me, but I can offer some recommendations if needed.

Normally, the county of the court pays jury service comp. Perhaps you could add some context or more description to your inquiry?

By implication, the distribution occurred after the 2022 rehire. However, the date of distribution (ie, before or after the rehire) is unclear from the original post.

Yes, advice from QDROphile is good (as usual). Other points: Since there is a new "administrator", there might be new QDRO procedures. Ask. The name/identity of the "new plan administrator" is (likely) irrelevant to what goes in any QDRO. You might need a new address, but it should not impact the content of the DRO and/or QDRO.

Is there a plan? What effective date?

Luke is exactly right. It's not a logical stretch to think that "excess plan" should include the comp limits, but that is not the precise wording of the statute. The historical context is that the compensation limits in IRC 410(a)(17) did not exist at the time ERISA [and its section 3(36)] were written in 1974.

Pretty simple to take the IRS version and cut out the parts you don't need (for example, if the Plan has no Roth accounts). In my experience, the only thing I customize is the plan name. Easy peasy.

Have I missed something? What is the distributable event?

Please do not do surgery on any rockets. 😉

Yes, to all the above advice. It might be prudent to do a little due diligence (and documentation) to make sure the plan was formally (and correctly) terminated. It cannot be both a merger and a termination. If the latter, then you know to step aside.

You might get some help by using the Search feature above, with the search phrase "mistake of fact".

And notice that the TRS Guide linked above does not refer to the participant and/or spouse signing anything. It does use the phrase "signed DRO", which refers to the proper court signatory.

You misunderstand. The most pressing issue for almost all members of Congress is getting re-elected.

Ya know, @austin3515, you are also permitted to "call Congress". Try your own Representative and Senators. Also, the various committees receive online comments.