david rigby

I agree with your solution to have the plan purchase an immediate J&S. (Unlikely an insurance company would want to sell a deferred annuity.) The process of completing the plan termination should not be held hostage to one participant/spouse inability or unwillingness to respond. I did this several years ago in a similar situation. BTW, it should be whatever the plan defines as the QJSA, no options. But send a letter to the EE advising of this action, giving 30 days additional response time.

You can Search the BenefitsLink Message Boards, also.

As George implies, a good first step would be to clarify "who is the employer?" They may not really be self-employed.

I agree wih Andy. When he states "protect the payment options", it would be prudent to consider the option factors in A versus those in B.

What does the plan say?

Depending on the size of your "non-frozen" group, (a)(26) may fail a year after the change (technically, at the end of the plan year following the plan year that contains the effective date of the change).

Aren't we all subject to audit all the time?Or does this client have something more definitive?

Well, maybe. But I assumed this is a new plan, so my comment had nothing to do with an amendment (at least, not in the formal sense). However, if -5 is relevant, who is harmed?

You may wish to review the 415 reg (issued March/April 2007):http://a257.g.akamaitech.net/7/257/2422/01...pdf/E7-5750.pdf Begin about page 40, and pay particular attention to the discussion about compensation after severance of employment.

Can you define initial eligibiltiy as "employed on the effective date of the plan", and subsequent eligibility using dual entry dates and 21&1?

I don't care about the machinations, but it concerns me that you kept something that you knew you were not entitled to. Does this bother anyone else?

You, and the plan, don't care "how Medicaid works". The plan is responsible for paying benefits each month under the terms of the written document, not for determining how the recipient is spending the money. The person from the nursing home was describing a reimbursement and accounting procedure, not a Medicaid procedure.

More generically, http://www.irs.gov/businesses/internationa...d=96739,00.html

Sieve's comments seem right on to me; the legal expense appears to be a settlor expense. Minor Q: w/r/t putting "the plan back in the same place", would it matter if the plan states that forfeitures are used to reduce ER contributions? Technically, not permitted? Practically, no harm?

Why terminate? Why not freeze it, and start whatever other plan is desired (PS, k, ESOP, etc)?

Data as of 29-AUG-08 Moody's Daily Long-term Corporate Bond Yield Averages Utilities Industrial Corporate Aaa NA 5.60 5.60 Aa 6.03 5.92 5.98 A 6.32 6.52 6.42 Baa 6.94 7.29 7.12 Avg 6.43 6.33 6.38 Moody's Daily Treasury Yield Averages Short-Term (3-5 yrs) 2.62 Medium-Term (5-10 yrs) 3.41 Long-Term (10+ yrs) 4.32

I assume you are referring to the 2007 PY valuation. Can you change the funding method and accomplish your goal?

Hmmm, you have a point. My point applies when a defective Q&A is discovered before grading is complete. Nevertheless, it may be hasty to assume the only course of action will be to give you a point (assuming you win your argument).

Pardon my ignorance, but I don't know what this means. How can you contribute to her 401(k) account? Is she the employer? Were you an employee of the same company (in which case you should have your own account)?

Included in the original question is Let's remember that is not a necessary result of the plan freeze, but is conditional. See IRS Reg. 1.411(d)-2(b)(2).

Although I don't have immediate access to Code or Reg for confirmation, my first guess would to answer True. BTW, if the JBEA decides that the question is invalid (for any reason), I think the protocol will not give you the point. Instead, they will throw out the question, for everyone.

That could be one alternative, but it places a burden on the payee to (help) solve a problem it did not cause.

"...may provide..." is correct. That is, the plan sponsor has the option of whether or not to include such compensation.

... but you still have to look at the plan document to make sure it does not say otherwise.

If you do this, don't forget to consider whether any portion of such fees are settlor expenses, to make sure they are not paid by the plan.