david rigby

Probably "due tomorrow" means a calendar year plan. If you want/need more time, file an extension, by 7/31.

On the chance that you are referring to a "wrap" arrangement, there have been a few discussions on these Message Boards. Here are a couple: http://www.benefitslink.com/boards/index.php?showtopic=18571 http://www.benefitslink.com/boards/index.php?showtopic=10445

Could you forward the names of other clients of this vendor?

This is the copyright in the 2003 Gray Book: Copyright © 2003, Enrolled Actuaries Meeting All rights reserved by Enrolled Actuaries Meeting. Permission is granted to print or otherwise reproduce a limited number of copies of the material on the diskette for personal, internal, classroom, or other instructional use, on the condition that the foregoing copyright notice is used so as to give reasonable notice of the copyright of the Enrolled Actuaries Meeting. This consent for free limited copying without prior consent of the Enrolled Actuaries Meeting does not extend to making copies for general distribution, for advertising or promotional purposes, for inclusion in new collective works, or for sale or resale.

Gray Book 2003-25 What restrictions apply to the payment of benefits to an alternate payee under a QDRO where the participant is one of the "high-25" restricted HCEs and the payment of a current benefit does not escape the restriction using the 110% or 1% rules. In the specific case, the spouse has been awarded 70% of the participant's 12/31/01 accrued benefit and the spouse would like to choose the lump sum option. RESPONSE The high-25 restriction applies to the combination of the benefit paid to the participant and the spouse. Thus the limit must be used and, assuming the spouse is limited to 70% of what the participant could have received, a lump sum distribution cannot be made unless an arrangement for repayment is in place (see Rev. Rul. 92-76). The spouse can be paid up to 70% of the life annuity amount (plus SS supplement if there is one) without restriction. Copyright © 2003, Enrolled Actuaries Meeting All rights reserved by Enrolled Actuaries Meeting. Permission is granted to print or otherwise reproduce a limited number of copies of the material on the diskette for personal, internal, classroom, or other instructional use, on the condition that the foregoing copyright notice is used so as to give reasonable notice of the copyright of the Enrolled Actuaries Meeting. This consent for free limited copying without prior consent of the Enrolled Actuaries Meeting does not extend to making copies for general distribution, for advertising or promotional purposes, for inclusion in new collective works, or for sale or resale.

http://www.ca9.uscourts.gov/ca9/newopinion...pdf?openelement

Highly recommended!

From Gray Book, Q&A 1999-30 In a 401(k) plan, does IRC Section 401(a) (17) preclude the following? A. Employee A earns $300,000 annually. He enrolls in 401(k) calendar year plan in August, after earning $175,000. He defers $10,000 for the balance of the year. B. Employee A earns $300,000 annually. He participates in a calendar year 401(k) plan making monthly deferrals of a flat dollar amount of 1/12 of $10,000 in 1998, even though his pay exceeded $160,000 before he was done making elective deferrals. C. Same as B, but deferrals are a percentage of pay (3.33333%). RESPONSE All of the above are acceptable, assuming the plan is not drafted in such a way as to prevent it. In situation C, for example, a plan provision permitting deferrals expressed as a percentage of compensation but not permitting deferrals expressed as a dollar amount could not accommodate deferrals on pay in excess of $160,000. Where the plan permits deferrals expressed as a dollar amount specified in the employee's salary reduction agreement, the reference to a percentage in the individual agreement is irrelevant. Copyright © 1999, Enrolled Actuaries Meeting All rights reserved by Enrolled Actuaries Meeting. Permission is granted to print or otherwise reproduce a limited number of copies of the material on the diskette for personal, internal, classroom, or other instructional use, on the condition that the foregoing copyright notice is used so as to give reasonable notice of the copyright of the Enrolled Actuaries Meeting. This consent for free limited copying without prior consent of the Enrolled Actuaries Meeting does not extend to making copies for general distribution, for advertising or promotional purposes, for inclusion in new collective works, or for sale or resale.

As Blinky states, Rev.Proc. 2000-40 is not available. However, a funding method change might still be available thru application. BTW, depending on the adoption dates, you might be able to do your 2002 valuation recognizing the plan freeze (you did specify both a plan freeze and a plan termination didn't you?). A freeze might automatically change a method, such as from PUC to UC. But then there might be a different problem: the IRS has stated (Gray Book, Q&A 99-6) that it is unreasonable to use an aggregate funding method when the plan is frozen or there are no active participants. Here is an earlier discussion about this topic: http://www.benefitslink.com/boards/index.p...50&hl=gray+book RSNOW refers to a Rev. Ruling. I think this is 81-136. http://www.taxlinks.com/rulings/findinglis...evrulmaster.htm

Late response, but .... No. I am not aware of any such online access. BTW, we pay for a copy when attending the EA (or other) professional meeting.

I agree with Harry O. I was in attendance at the EA Meeting session that discussed that Q&A. Quite a few in the audience just shook their heads at that interpretation. IRC 411(d)(6) explicitly focuses on paln amendments, yet IRS viewpoint seems to be otherwise.

If the goal in this situation is that the participant should get a $6K match, then defining the match are related to comp is what causes the problem. Why not define it as 50% of the deferral?

Perhaps the original question is really asking about a safe-harbor plan?

Not sure about the interpretation, but you probably have a problem with plan drafting.

Even if the plan is not covered by the PBGC, the plan language may already address this.

All Schedules are open to public inspection except E and SSA. (Schedule B is open to public inspection except when attached to form 5500-EZ.) It would incorrect to provide these schedules with a copy of the full form 5500.

There is always a possibility that plan provisions indicate a need for notice. If a CBA is involved, check that also.

Whether you include that person in the valuation at 1/1/03 is part of your funding method. Whether that person is a plan participant at 1/1/03 is based on plan provisions.

I'm having a brain cloud (remember the movie "Joe vs. The Volcano"?). Please help me recall the reg. cite that tells us a DB accrued benefit (for example in an excess plan) cannot decrease solely due to the increase in the SS wage base. Thanks.

Keth is correct, but what does the valuation date have to do with it? In the example, the employee enters the plan on 7/1/03. Assuming the employee meets the minimum number of hours for a year of "credited service", then the employee/participant gets an accrual. It does not matter whether the person is included in the 1/1/2003 valuation census. By the way, the plan might even award retroactive credited service for the time since date of hire, in which case the employee would ahve 2 years of credited service at 12/31/2003.

No plan is required to file for a determination letter.

Wait a minute! You are surprised that Congress might go "back on its word"? As always, Congress giveth and Congress taketh away. BTW, some people thought that the Roth IRA was a scam anyway, so if it changes, that might not be so bad.

Does a 4-year-old have earned income (“compensation”)? See “What is Compensation” on page 9 of this publication: http://www.irs.gov/pub/irs-pdf/p590.pdf

Section 652 of EGTRRA amended IRC 404(a)(1)(D) as follows: SEC. 652. MAXIMUM CONTRIBUTION DEDUCTION RULES MODIFIED AND APPLIED TO ALL DEFINED BENEFIT PLANS. (a) IN GENERAL- Subparagraph (D) of section 404(a)(1) (relating to special rule in case of certain plans) is amended to read as follows: (D) SPECIAL RULE IN CASE OF CERTAIN PLANS- (i) IN GENERAL- In the case of any defined benefit plan, except as provided in regulations, the maximum amount deductible under the limitations of this paragraph shall not be less than the unfunded current liability determined under section 412(l). (ii) PLANS WITH 100 OR LESS PARTICIPANTS- For purposes of this subparagraph, in the case of a plan which has 100 or less participants for the plan year, unfunded current liability shall not include the liability attributable to benefit increases for highly compensated employees (as defined in section 414(q)) resulting from a plan amendment which is made or becomes effective, whichever is later, within the last 2 years. (iii) RULE FOR DETERMINING NUMBER OF PARTICIPANTS- For purposes of determining the number of plan participants, all defined benefit plans maintained by the same employer (or any member of such employer's controlled group (within the meaning of section 412(l)(8)©)) shall be treated as one plan, but only employees of such member or employer shall be taken into account. (iv) PLANS MAINTAINED BY PROFESSIONAL SERVICE EMPLOYERS- In the case of a plan which, subject to section 4041 of the Employee Retirement Income Security Act of 1974, terminates during the plan year, clause (i) shall be applied by substituting for unfunded current liability the amount required to make the plan sufficient for benefit liabilities (within the meaning of section 4041(d) of such Act).

It appears to me that the definition of UCL in 412 (l)(8) is based on use of the AVA in 412©(2). I conclude that the UCL for purposes of 404 is determined using AVA.