david rigby

The terms "entire balance" and "lump sum" are often used to mean the same thing. Is that in conformance with your plan provisions? The instructions for Form 1099R make generous use of the term "lump-sum", but you may wish to review for yourself.

In my observation, there is a difference between "compensation" (ie, paid to an employee) and "fee" (paid to a non-employee, including a consultant). If it's a bona fide consulting relationship, what fee that person receives should not be relevant to a qualified plan. Or do I misunderstand the question?

My understanding is that any "housing allowance" must be reasonable for the purpose designated. For example, it would (probably) not be reasonable to replace a $30,000 salary plus $10,000 housing allowance with a $40,000 housing allowance. When you suggest that 403b distribution as a housing allowance, isn't that changing something defined as "deferred compensation" into "non-taxable compensation"?

Yes, it's an operational error, but there is also a practical aspect: maybe those participants weren't paid out because they never provided the ER with an updated address. A review of this may suggest that the ER modify an HR policy (ie, outside the plan itself) to emphasize to departing employees the importance of a mailing address.

It's common to see the various limitations get mixed up. If you can identify who told you about this 25% limit, ask for a cite. That is, the reference might not be correct for a DB plan, but it may have relevance on a related item.

Has someone reviewed a draft of the DRO? If not, and the draft requires modification, it may difficult to determine how much additional time is needed.

Thanks for sharing and contributing. Enjoy.

I think there is oversimplification in this analysis. It seems to assume that prices would be unchanged. You argue for the elimination of corporate income tax, but there might be equally valid arguments for the opposite: eliminate all tax on labor.

I've discussed this issue with a sponsoring church (also non-electing), although not yet implemented. We concluded "the document rules": Use the A.E. definition(s) in the plan; J&S election required only if the plan includes that language. (If spousal signoff is not required, but you want to include it anyway, get legal counsel signoff on that procedure, since you might be faced with a situation that contradicts the plan document if spouse says NO.) I doubt you need to include the immediate annuity option; it may seem harmless to include it anyway, as a comparison tool for the participant. However, it may backfire, especially if the EE is close to retirement age. Cautions: (1) watch out for generic language that might incorporate 417 by reference. (2) anticipate the possibility of someone electing the annuity, especially if the person is close to early or normal eligibility.

The Employer may have a different problem: an employee who has lied.

Data as of January 31, 2017 (Tuesday) Moody's Daily Long-term Corporate Bond Yield Averages Utilities Industrial Corporate Aaa NA 3.99 3.99 Aa 3.99 4.08 4.04 A 4.19 4.21 4.20 Baa 4.61 4.74 4.68 Avg 4.26 4.26 4.26 Moody's Daily Treasury Yield Averages Short-Term (3-5 yrs) 1.69 Medium-Term (5-10 yrs) 2.23 Long-Term (10+ yrs) 2.88

I agree with a desire for procedure(s), as long as that is general principles, not detailed instructions. However, I do not suggest putting anything in the plan (or SPD). BTW, I searched the Gray Book and found no reference.

Well..... that is a way to do it, not the preferred actuarially correct method. But you are in the ball-park. IMHO, the 7.5% rate is not reasonable, but it might be acceptable to the negotiation, and is certainly favorable to the husband. BTW, several of the actuaries who contribute to these message boards can provide a detailed service.

I've seen a POA a few times. In every case, the PA got its own confirmation/legal opinion that a POA was valid or not. (This may have included other practicalities, such as other known evidence about a participant's disability, etc.) In all cases, the PA was clear that lack of authenticity of the POA would mean "don't do anything", except that the plan's appeal process may be triggered by the submission of a (proposed) POA. If the POA was determined to be valid, the same legal advisor would describe whether the POA has limitation(s) within the plan context. (IMHO, this last part is essential, and is evidence that the legal advisor reviewing the POA should be an ERISA attorney.) As the actuary, I give my opinion only when requested by the PA, but always defer to opinion of the legal advisor.

In 35+ years, I've never seen any plan document or administrative procedure that made any reference to a POA.

Just a hunch, but it's possible the original poster might be confused by some of these responses. Here's my summary (which may not be complete): In general, most plans permit a payment only upon limited circumstances: severance of employment, death, disability, etc. (The plan is not a piggy-bank; it's designed for long-term retirement needs, not short-term cash-flow.) Some plans offer the ability to make a loan to a still-employed participant, generally repaid thru payroll deductions. No plan is required to offer this feature. As stated above, it's trading one debt for another, so may not address your larger problem. Some plans offer the ability to take an in-service payment if you are still employed beyond a specific age (such as 65). It's not required. A QDRO ("qualified domestic relations order") might create the right to an "early" payment, but that may not be productive since it is for the purpose of fulfilling a domestic relations order. Most DRO's are related to divorce/separation, and a few are related to child support. Generally, a QDRO will create the ability for someone else to get a payment (ie, spouse/ex-spouse, child's guardian, etc.), rather than a payment to you. It's also possible that the plan itself could limit the timing under a QDRO (for example, not prior to the time the participant could get a benefit); if so, the QDRO is not permitted to alter this plan provision. If this is a defined benefit plan, the plan may permit a payment only in the form of an annuity (ie, monthly payments), and will not permit any type of lump sum, even with a QDRO. Declaring bankruptcy will (probably) not create any mechanism to speed up any payment to you. If this is a defined contribution plan, as stated above, the plan may have a provision that permits hardship distribution. There are tax consequences. Read your summary plan description.

Sorry if my too-brief post added confusion. In my view, this question is tied to the nature of what happens in a plan termination, as well as clarity of plan definitions: a freeze amendment should freeze the benefit, participation, and benefit service. (Yes, I've seen many poorly-drafted amendments that were not that thorough.) Of course, the amendment cannot freeze vesting service (assuming an ERISA plan). In order to facilitate plan clarity, I advocate using multiple defintions of service within a document: eligibility service, vesting service, benefit service. Each will be a subset of the plan definition of "Service", but might have its own variation (for example, benefit service might permit fractional years, but vesting service probably won't). The plan will define eligibility for Early Retirement (and maybe Disability) by reference to VS (never using a term as simple as "service"). By freezing Benefit Service but not Vesting Service, it should be immediately clear that the freeze amendment will have no effect on this definition. Accordingly, no one (not the employer nor employee, etc) will debate the original question of whether the employee can "earn into" the Early Ret benefit, because the Plan already defines it.

This is the reason many plans define the eligibility using Vesting Service.

Is the wife already deferring the max?

Has the $3,000 really been "sent" to the IRS? Or is it in some account, waiting to be sent? Also, not an answer to your question, but "what the...?"

Yeah, that is still an odd use of "accrues" (as far as I've seen).

I'll give this a shot, but not necessarily confident in my response: I think whether this payment is "roll-able" may depend on exactly how it's defined in the plan document. For example, if it is defined as a death benefit, it might be roll-able, but if it's defined as part of the annuity stream, I'll suggest it is not roll-able. BTW, I really don't like the manner in which you use "accrued". Definitely not in conformance with most usage in the context of a DB plan. Maybe it's just me.

Does the plan definition of beneficiary answer the question? (Read it twice.)

The employees of the other attorney get a W-2 that has the employer name and EIN for Jelly?

I'm perplexed by the over-emphasis on the S&P500. If you are unable to get accurate records and are forced to estimate the earnings, pick one or more indexes that reflect the actual (types of) investments in your account.