david rigby

Don't forget to look at the big picture: The dentist (ie, the boss) might get some value (eg, happy EEs) by simultanelusly announcing the sale and saying, "for those of you who are not already 100% vested in our plan, you now are 100% vested". This should be true even if the vesting occurred via amendment and the sale takes place a few weeks later.

If this is a DC plan (as Luke tells us), there is the presumption that the entire account balance is the death benefit, payable to (at least) one beneficiary. Therefore, this is the amount that could be transferred to a court; no more, no less (unless I have overlooked some unusual circumstance). However, one of those unusual circumstance is that some DC plans include J&S payment forms; these are precisely the plans where the original B vs. C "conflict" could be relevant, so the precise death benefit is not knowable.

Nothing on point in the Gray Book.

Luke, could you avoid the 1099 question by: segregating the $$ amount into a separate account (ie, not actually distributed), and informing the court of such action, and with distribution (and 1099) pending until the court makes its decision?

Not to muddy the waters: If this were a DB plan, it's possible the benefit payable to B does not equal the benefit payable to C.

No disagreement with prior responses, but there is another important consideration. If you estimated 15-20K, but your actual time was 12K (and that's what you invoice), then you may need (proactively) to explain why your actual is outside your estimated range. This is not always the case, but a competent consultant will anticipate such questions in the client relationship AND consider whether this has an impact on any future fees. A good consultant will always be considering the viewpoint on the other side of the relationship.

Hi Effen. Would it help to address these specific questions directly to the CSRS?

Just wondering about the practicality: Is it possible to have an independent appraiser make such a determination within 60 days after separation of service? if not, maybe some other formula? Asking for a friend.

Is there also a DC plan? Not mandatory, but it might be useful to make sure the plan design considers the existence of another plan.

What does the plan say?

Reasonable, but not conclusive. However, as QDROphile implies, it would be prudent to get some documentation. BTW, my limited experience with the federal pension program is that they do not use "DRO" or "QDRO"; instead, the term "court order" is used, but terminology may not be consistent.

As CuseFan implies, no one wants to be left holding the bag (or a bad check) for someone else's sloppy records or handwriting. Consider when a sponsor has two plans (say, hourly and salaried); it's very important to correctly document every transaction, in both directions. Look for ways to accommodate both the sponsor and the financial institution.

TPA pricing structure might have some influence on the plan sponsor's choice. Consider carefully.

Is there a DRO that purports to be a QDRO?

Revenue Ruling 2002-84 was published in Internal Revenue Bulletin 2002-50, dated 12/16/02. https://www.irs.gov/pub/irs-irbs/irb02-50.pdf.

Have you seen any study about possible anti-selection (e.g., higher average mortality than the overall population or plan population) with respect to a Social Security Level Option?

You might find some relevant discussion in this recent thread: https://benefitslink.com/boards/index.php?/topic/69629-contingent-beneficiary-question/

As Peter notes, and as implied in the quote above, there may be doubt that the distribution is an eligible rollover distribution, ie, it might not be rollable to any IRA/Qualified plan. (If it's not rollable, the 20% withholding does not apply, but another withholding rule will apply.) If that is the case, there is no (probably) no vehicle for a rollover or "putting it back". Something that should have been discussed with the participant (who is also the plan sponsor, apparently) at the time he/she expressed interest in any type of withdrawal. If the participant is treating this like a piggy bank, someone should explain the difference. It may be a broken record with me: "Please put on your consulting hat!" There might be value in reading this, in conjunction with the plan document: https://www.irs.gov/retirement-plans/plan-participant-employee/when-can-a-retirement-plan-distribute-benefits

It's not a "rollover from itself". It's a rollover from a qualified plan. I doubt there is a 1099 question. The Plan prepares the 1099 based on the distribution (eg, direct rollover? cash? combination? based on death/disability?, etc). The Plan never cares what the recipient does with the money afterward. The plan (probably) does not prepare a 1099 to reflect the rollover, but it likely provides the participant with some documentation that it received the rollover; this provides the participant with documentation where the money is as well as compliance with the 60-day rule. Anticipating your next question, if the distribution is $10K consisting of $8K cash + $2K tax withholding, the participant may make a rollover of anything up to $10K. The Plan does not care what financial bucket that money comes from, but the Plan will normally want proof that the rollover does not exceed the total distribution.

Agree. FWIW, I checked the Gray Book (discontinued after 2015) and found nothing on point. @Luke Bailey, might there be a relevant Q&A in some prior IRS/ABA conversation?

Does the Plan accept rollovers?

Here is another thought: Contact one or more of the dozen or so Enrolled Actuaries who also have a JD after their name.

And additional discussion here:

DB plan sponsor is an insurance company, currently in receivership under its state insurance department. This status has not altered the plan's requirement to do annual valuations, file 5500, etc.; the actuary prior to receivership is still in place. The prospects for rehabilitation (and/or coming out of receivership) are virtually nil. While there is no formal statement yet from the state DOI, it appears likely the DOI will seek to have the PBGC take over the plan. (The plan actuary has not been part of discussion, if any, between the DOI and the PBGC.) Most recent AFTAP is around 100%, but a termination ratio is estimated around 70-75%. The plan has been frozen for several years. The plan has an unlimited LS option. The current question is whether any PBGC regs and/or practices would require the plan to suspend (ie, before any formal action by the PBGC) the use of the LS option for anyone currently reaching a benefit commencement date (retirement or otherwise)? My review found nothing on point; checked all the Blue Books, did not see anything in the regs (although that might be easy to miss). Any relevant experience? Ideas/suggestions?

Not the first time for this question: