david rigby

Why? What is your relationship to the plan? To the parties? Do you know whether the divorcing parties expect to include any particular assets (in this case, the 401k accounts) in their asset division? Even if you do know, is it any of your concern? Is it possible the parties will find ways to simplify asset division by ignoring some? Is it possible both accounts are small enough so as to be trivial? (BTW, these questions might be inter-related.) I'm not really asking you for answers, just pointing out that the plan (and its administrators) should stay out of the legal proceeding. It seems likely the QDRO procedures direct you to act on a (draft) DRO only if you get one. Alternatively, if your QDRO procedures direct you (or someone) to speak up (or take any specific action) whenever you hear about a potential divorce of a plan participant, then you should quickly engage an ERISA attorney to help you correct that.

@Paul I is correct. However, it's worth noting that the original post said nothing about buyer or seller or multiple plan sponsors, only about a merger of one plan into another plan. Careful consulting practices will help plan sponsors understand the difference as well as how to anticipate (and properly execute) such transactions.

I think the location of the assets is 100% irrelevant.

I'm unsure of the answer, but it bugs the crap out of me. (OK, that's not the technical terminology.) My response is, if you want to do this for someone who will (later) be a HCE, why wouldn't you do the same thing for any new hire? Why not treat everyone the same, but (maybe) change the eligibility to something more generous (such as first calendar quarter following DOH)?

Just an opinion: changing anything on Exhibit A is a plan amendment. Thus, something must be signed (board resolution, plan amendment, probably both).

How will they handle transferring employees?

Maybe it's just me. It seems more likely that the number of NHCEs during the audited year(s), including whatever benefit they earned and/or vested, will be the more important concern.

Well, assuming the plan uses "January 1" as a defined Entry Date. However, it might use "December 31". Verify.

Thankfully, I'll never have to do this again: About 25 years ago, I spent a full day with a bankruptcy attorney, educating him about ERISA matters for our common client in bankruptcy. Maybe the legal world is different now. If the bankruptcy attorney does not have ERISA experience, don't be shy about suggesting that someone (not you) should engage the necessary legal assistance. Of course, as pointed out by @EBP, there is no mention (yet) of a formal bankruptcy filing.

Non-lawyer opinion: Likely, any answer to the original question that is posted here will be inadequate and/or a guess. The plan sponsor needs its own advice from its own ERISA counsel, who will (presumably) inspect the relevant documents and interview the relevant persons.

Just a hunch: this plan sponsor should probably want its legal counsel and auditor to review the situation.

This Q appears to be from someone new to the process (nothing wrong with that). The links above are good starting points. Since you posted this in a DB forum, don't overlook anything required by the PBGC: https://www.pbgc.gov/prac/reporting-and-disclosure. There are also some other forums here that might be useful: https://benefitslink.com/boards/index.php (using the Search feature might help answer a future question). For reference, whenever the law or regulatory publications use the word "reporting", it means "reporting to (one or more) government agencies". The word "disclosure" means "disclosure to plan participants".

As with MANY inquiries from the sponsor/client/company, it's often best to ask questions, such as: Why do you want to do this? What is special about this situation? What is special about this person? There may be more than one way to solve a problem. Maybe I sound like a broken record, but I'm just asking you to act like a consultant.

IRC 411(e) reads as follows: (e) Application of vesting standards to certain plans (1) The provisions of this section (other than paragraph (2)) shall not apply to- (A) a governmental plan (within the meaning of section 414(d)), (B) a church plan (within the meaning of section 414(e)) with respect to which the election provided by section 410(d) has not been made, (C) a plan which has not, at any time after September 2, 1974, provided for employer contributions, and (D) a plan established and maintained by a society, order, or association described in section 501(c)(8) or (9), if no part of the contributions to or under such plan are made by employers of participants in such plan. (2) A plan described in paragraph (1) shall be treated as meeting the requirements of this section, for purposes of section 401(a), if such plan meets the vesting requirements resulting from the application of sections 401(a)(4) and 401(a)(7) as in effect on September 1, 1974. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section411&num=0&edition=prelim

Just for clarification, was the effective date of the 2022 plan amendment prior to the owner/EE date of death?

There have been a few previous discussion threads. The Search feature might help you. For example, this one from 2019: https://benefitslink.com/boards/topic/63887-annulment/

Not my area of expertise, but it's possible you can get some value by searching this forum: https://benefitslink.com/boards/forum/68-investment-issues-including-self-directed/

Links to Revenue Rulings available here: https://www.taxnotes.com/research/federal/irs-guidance/revenue-rulings/rev-rul-73-553/d93b?highlight=73-553

Form and Instructions for I-9: https://www.uscis.gov/i-9

Is the auditor stating, or implying, that the ER should be doing something like this, as a normal action, to verify DOB for its EEs?

Why aren't you asking the actuary? He/she can do this, probably with alternatives you have not yet considered.

1. Does a plan exist or is this hypothetical? 2. What does "have extreme excess" mean? 3. What is the relationship between the original poster and the plan and/or the plan sponsor?

@Peter Gulia identifies a generic issue, relevant to any relationship with a vendor. That is, does a plan sponsor want to take an administrative action that "binds" it (the sponsor/plan administrator) even if such "binding" is only slight? Obviously, the corollary is, "So what? We can change it later if needed." The answer(s) might be related to the sponsor/PA perception of risk tolerance and/or whether there is a potential fiduciary risk.

Exactly! There are likely easily administered ways to get at the ultimate goal (whatever that is): maybe 1 yr w/o regard to hours; maybe 1 yr w/ 1000 hours; maybe 18 months after DOH; maybe 15 months after DOH; maybe 12 months after DOH; etc. No disrespect intended, but there is (likely) something else behind this. Possibly related to one particular person? Maybe there is a different method of addressing the underlying issue? Probe for the real reason(s).

Put on the consultant's hat and ask the usual first question: What are you trying to accomplish?