Andy the Actuary

Sieve knows my charitable efforts very well -- Over the years we have made generous donations to numerous relatives!

I was not solicited. I was invited to a celebration and will be unable to attend. Thought a gesture was in order.

Agreed.

You got me!!!

If you mean full cash refund annuity, see Life Contingencies, Chester Jordan, Chapter 7. P.S. It's an algorithm rather than a formula and you haven't experienced true joy until you manually completed a columnar worksheet with the help of a mechanical comptometer to solve this monster.

I am long-term actuary for a DB Plan sponsored by a not-for-profit agency. The agency pays my fees out of the Plan. Of course, since PPA, the TNC incorporates this fee (expenses are assumed to be the preceding year's). Anyhoo, the Agency is celebrating its 2,000 birthday and I would like to make a personal donation (from personal, and not business checking account) of say $100 in commemoration of this occasion. Assume the $100 is deminimis relative to my fee. Anyone have concerns that this gesture could fall under the category of "No good deed goes unpunished?"

It's the interpretation of the antecedent of "coinciding with." Break your sentence up. (a) first day of the Plan Year is 1/1/2010. Does this date coincide with or next follow 11/30/2010. NO (b) seventh days of the Plan Year is 7/1/2010. Does this date coincide with or next follow 11/30/2010. NO We are talking about the date coinciding or next following, not the Plan Year coinciding with. This is standard language to handle the case when, for example, an employee is hired on 7/1/2010. Then, one year from the hire date is 7/1/2011 which coincides with the first day of the seventh month. So, the employee would participate on 7/1/2011 rather than 1/1/2012. Hope this helps.

The coincident with or next following applies to the date. Since both entry dates in 2010 preceded the 12-month eligibility period end, the next date is 1/1/2011. If the language were to mean 1/1/2010, the Plan would typically have stated first day of the Plan Year in which eligibility criterion are met. One final point, before completely tossing out your conclusion: While eligibility to make deferrals as of a preceding date doesn't have a lot of meaning, nonetheless, look to how the Plan has been administered.

Today I sent the IRS $64.25. I received this evening an email with subject "PTIN Welcome Letter" The message read: "Attached please find an official communication from the Internal Revenue Service about your Preparer Tax Identification Number (PTIN) application" (Note, no period at the end of the sentence) The attachment was an .rtf word file with a bunch of numbers as a title. This is either a phishing scam or the IRS needs to use some alternative communication methods. If this is a phishing scam, then the IRS website may be compromised. I did not open the rtf file. Here's an enjoyable comment I found on Tax Almanac: "Funny but when I sent it to the "phishing Desk" they sent back the standard warnings that 'we never email you.' I am not sure which one of us, the IRS or self, is dumber for I read that they would send this but forgot. "

As long as we're talking solutions, horsewhip the guy who ever tied lump sum interest rates to some fictitious index that may not bear in time or substance any resemblance to how assets are invested or even the fixed interest market at the time of distribution. So, given that you're dealing in fiction, why not go for simplicity? Instead, allow for standard fixed interest rate a la 401(a)(4). The low end of the interest rate range would be used for 415. Then, you would adjust for 415 only for years of participation, distribution age, and distribution form. Then, guess what guys? Plans would no longer be funding to a moving target and excess assets would develop only if Plans invested aggressively and succeeded.

Clara Peller asked "Where's the beef?" A.T.A. asks, "Where's the fix?" PPA purported to make pension plans safe for America, end all wars, and obliterate tooth decay. A calendar year DB plan uses the preceding September segment rates, which for 1/1/2010 meant 5.03, 6.73, and 6.82. The liability held for A. Participant was $222,000. The Plan distributes lump sums based upon the segment rates as of the first day of the calendar quarter that precedes the calendar quarter of distribution. That's a mouthful but by example, the July 1, 2010 segment rates are used for a December 1, 2010 distribution. The July rates were 2.83, 4.66, and 5.26. Under these rates, a lump sum of $282,000 will be distributed, which is 27% greater than the amount reserved. So what exactly has PPA fixed other than constructing an overly complicated basis for another undelivered political promise?

Hey, he answered the question!!!

Pulitzer Prize winning cartoon (1926) of Daniel Fitzpatrick, cartoonist for St. Louis Post-Dispatch

Does your 415 problem go away if the Plan is amended to allow for immediate unreduced retirement at 55?

Keeping in mind that no good deed goes unpunished, fixin' what ain't broke may invoke the law of unintended consequences.

Archimedes Baby Ox Principle: A newborn baby ox weighs 17 pounds. You lift it everyday. After a year, you are lifting a full grown ox. So, it you should be exactly accurate with 34, then what about 35? If 35, then what about 36? What is the cutoff for doing the job right versus approximately right? Perhaps it's the Justice Potter Stewart's definition, "I don't know how to define the cutoff but I know it when I see it." How would the PBGC react on a premium audit (Does the PBGC conduct premium audits) if they discover reporting was inaccurate? It is incumbent upon us to do "the best to our knowledge" and if our knowledge changes, fix whatever if the resulting count is material.

A client sent me an employee census of a Company they just acquired. The census had 17 employees none of whose last names began with the letters A-G. The odds against this are a little over 200 to 1.

May not be quite that easy as you may need to look at all former employees as well if you grant more than 5 years of past service.

SCA, thank you. I've clarified hypothesis to indicate boy valuation.

There appears to be differences of concern on this one so am revisiting: Facts: Calendar Year Plan Year with January 1 (i.e., boy) valuation date. In 2009, there was a minuscule shortfall so that quarterlies are required for 2010. On April 1, 2010, employer elects to offset 2010 MRC by FSCOB. The election language does not speak to quarterly contributions. Was a quarterly contribution due April 15, 2010? IMHO, if quarterly is due April 15, 2010, then what is point of using FSCOB to offset MRC? Yet, this particular point does not appear to be specifically articulated in final 430 regs., though the regs. do state specifically that the offset occurs as of the valuation date. The conclusion is so long as the election is made before the first quarterly due date, all is copacetic. Agree? Disagree?

401(a)(4) and grants of past service

(Unless the Plan required)

I had the problem where it printed gibberish. In such case, I selected a different printer (i.e., print driver) to resolve.

By not printing do you mean not outputting to print spooler or do you mean pages print but you get gibberish? Can you print to a pdf?

Wouldn't you need to provide a J&75% unless the Plan already provides an optional J&50%?