david rigby

Please more information. Restate your inquiry with a bit more background and details.

Might also be worth pointing out that the plan administrator is charged with upholding the terms of the plan. Most plans authorize the PA (or committee) to seek its own legal advice when needed.

This may not be on point with your question, but I reviewed the Q&As for SFAS No. 87. Q.11 reads as follows: If an employer has a non-qualified pension plan (for tax purposes) that is funded with life insurance policies owned by the employer, should the cash surrender value of those policies be considered plan assets for purposes of applying Statement 87? A.11. No. If the employer is the owner or beneficiary, the life insurance policies do not qualify as plan assets and the accounting for those policies should be in accordance with FASB Technical Bulletin 85-4, Accounting for Purchases of Life Insurance.

Hmmm. Not sure, but I think that the general rule is that withholding from periodic pension payments is based on the same table as for wages, whatever those tables might be.

Might be some estimate on the DOL website. http://www.dol.gov

But keep a record of the change, and make sure the plan sponsor, attorney, auditor, TPA, actuary, etc. all receive a copy.

Probably depends on the plan terms. However, the general rule is that the subsidy should be available to the participant in the annuity option he receives, and does not have to be included in the lump sum option he receives. But be aware that precedent is likely very important. That is, if the plan has offered a lump sum to past early retirees, what subsidy, if any, was included in that lump sum?

Don't forget about partial termination and the resulting 100% vesting.

OK. Perhaps my problem is that I don't recognize all the extensions listed. For example, I don't know .rpt or .png. Thus, I don't have access to all the necessary applications.

I also appreciate the ability to use attachments. However, it is very annoying to receive attachmwnts where the sender did not describe what kind of file it is, or what application is used to view it. Is there a way to address that?

I'd say it sounds like a drafting problem. Your description implies that the surviving alternate payee (I presume this is the ex-spouse) is to get a death benefit, but not before the participant would have reached (early?) retirement age. That is, the DRO may not spell that out, but it sounds like that is the intent. Probably an issue that should be better addressed within the language of the DRO. BTW, you did not say QDRO. Is it qualified?

Keith, which EA meeting(s) and which session(s)?

There are a number of earlier discussion threads that might help. http://www.benefitslink.com/boards/index.php?showtopic=7890 http://www.benefitslink.com/boards/index.php?showtopic=9005 You might also do a search on the Message Boards using "buy-back" or "repayment" as a search criteria.

What is really neat about this whole act is that it "sunsets" at 2010. Don't count on it. This is a very public statement by Congress to encourage lobbying in future years, so that later legislation can "correct" or "fine-tune" any problems in current law.

This is a pretty subtle point. See Q&A T-24. BTW, don't forget Q&A T-28. An earlier discussion might be useful: http://benefitslink.com/boards/index.php?showtopic=7605

Amen. My experience is that govt. employers are glad to "lean on" ERISA requirements as guidance for employee communications. The SPD is a good example; however, don't include the "ERISA rights" section since it does not apply.

Or here: http://www.federalreserve.gov/releases/h15/

I have no idea, but as a taxpayer, I would strongly object to this giveaway, with no return to the employer/taxbase.

Well, I'm sorta "on the fence" here. I don't think you should apply different standards to DB and DC plans, but the DC plan definition of when forfeiture occurs might be relevant. I looked at the 1.416 T-H regs, especially Q&A T-24, T-28 and T-30. The language there talks about "the account balance". The only adjustments are for accrued contributions (in certain cases) or for "distributions". I doubt a forfeiture would be considered a distribution. My conclusion is that, unless the plan has some definitions to the contrary, I would use the account balance after applying the graded vesting. But read all associated definitions carefully. I'll muddy this up a bit more with another point found in T-24, first sentence: "...the account balance as of the most recent valuation date occurring within a 12-month period ending on the determination date..." It might be possible that the employee is active on that valuation date (hence no forfeiture) but is terminated (with partial vesting) on the determination date. Any other opinions?

Not sure if I understand the question, but here goes. Are you asking how to treat partially vested participants, whether active or terminated? If so, good question. I think the general rule is that vesting is not relevant to a T-H test, so you use the entire accrued benefit for a partially vested active employee. For a partially vested terminated employee, I think the accrued benefit is the vested portion. That is, any benefit is determined at some event date (death, disability, termination) so that the amount of the accrued and the vesting percent are both determined at that event. If the employee terminated partially vested, I would use the vested portion. However, there could be a couple of other points to remember: 1. If the terminated vested employee does not have at least one hour of service in the last five years (or whatever the lookback period might be), then that participant should be excluded from the test. 2. If the partially vested terminated employee is rehired, then there might be a "restoration" of the previously forfeited amount. Anyone want to shoot holes in my reasoning?

Sorry, perhaps my question was not clear. I was focusing on the waiver of the 100% excise tax, not the waiver of the contribution itself.

Plan year is 10/1 thru 9/30. On 6/15/2000, plan sponsor failed to make accrued contribution, resulting in a funding deficiency retroactive to 9/30/99. Sponsor paid the 10% excise tax (under IRC 4971). I think the IRS has stated they do not have authority to waive that tax. Assume the deficiency is 100K. The contribution for the 1999/2000 plan year is due 6/15/2001. Assume that contrbution is 300K, including the prior funding deficiency. 1. If the sponsor cannot make the 300K by 6/15/2001, but does make 100K (plus interest), then does that correct the prior funding deficiency? 2. If less than 100K plus interest is contributed by 6/15/2001, then clearly the prior funding deficiency is not corrected. Section 4971(B) imposes a second excise tax of 100%. My understanding of 4971(d) is that the IRS might waive this second excise tax. Does the sponsor have to apply for such waiver in advance? If the sponsor knows it will not make the 6/15/2001 contribution, any other action necessary in advance?

Several prior discussions on this topic, although they may not deal with Puerto Rico. You might try a search using "missing participants".

Uncle. If RCK has it "set up right and run right", I can't argue with that. Thanks for the real world situation.

I agree with Paul Dugan. I would not want to do a valuation and/or Schedule B where a DB plan assets are commingled with a DC plan. In a DB plan, all assets are available to pay any benefit that is due; that is, no dollars are "allocated". If you have a mixture of plan assets, then the amount of assets for each plan can be "muddy" (that is the technical term). Even if it is OK to have commingled assets, but why take the risk of confusion.