GMK

Agreed. There's still 3 weeks left in January. Any chance they can get the notices out yet this month?

As I was properly corrected above, if a participant dies before their Required Beginning Date (RBD), the participant does not have to take an RMD for the year in which the participant died, regardless of the age of the participant. This person's RBD is 4/1/15, and he died before 4/1/15. No RMD for 2014. RMD's to the beneficiaries begin in the year after the participant died (2015), generally based on life expectancy rule or the 5-year rule (check the terms of the plan). The beneficiary's RMD for 2015 is paid before the rollover to the inherited IRA.

and it's definitely a slippery devil in this case.

I can't get over seeing: the terms "standards of fiduciary conduct" and "governmental" in the same sentence, criticism of mbozek for posting accurate, knowledgeable answers to each question, and the idea that no-load institutional class shares do not offer revenue sharing. Guess I'm not gonna be much help here, but it was interesting reading for a while.

edit: I posted in error. see posts, below. Died before RBD, so no participant RMD for 2014. Beneficiary RMD's begin for 2015 or per the 5-year rule. sorry, GMK [wrong->] Yup. And when the IRS asks why an RMD was not taken in 2014, write a letter explaining the timing, and they will likely waive the penalty ... or so I have read. [or 5-year rule - >] and yup. If I read the chart correctly, for 2015, use the single life chart based on the beneficiary's age in 2015, and then for 2016 and after, reduce that life expectancy by 1 in each year. That is, you use the life expectancy table only once for a non-spouse beneficiary when the participant died on or after the RBD.

Visually rhymes with cute. Anyway, English is by design a language to be messed with ... oops, with which to be messed. (As some former President probably said, "Ending a sentence with a preposition is something up with which I will not put.")

^ Sorry to disagree with you, but I think we both got it right. Anyway, it's a mute point. If you're bipartisan, you're not in Congress any more.

^ My guess is that the court would give considerable weight to the wording of the CYA clauses the publisher included in its letter of assurance.

True, but despite non-discrimination efforts and legislation, bi-partisans will probably never be accepted by some of the hetero-partisans in Congress.

ERISA RIP? http://www.erisalawgroup.com/documents/2014-December-Flash.pdf

I would consider that the "distribution" occurs when the funds are no longer in the pre-tax account, like when the check is written in the write-a-check case. Typically, the check is issued after the date (or at least rarely on the same date) that the election is signed and submitted.

Ehill - To be clear (and my apologies if you already know this), the SPD is a summary of the basic provisions of the plan. It is not the plan document, which, as Lou S. said, has the answers to your questions. Participants can review the plan document by scheduling a time to review it with the plan administrator.

How about an amendment to the effect that if participants' employment ends because the company sells off their division before they have 2 years of service for vesting, then those participants will be 100% vested. Probably wouldn't have to try to hide the amendment from the other 2400+ employees. Whatever you do, run it past your ERISA counsel before amending.

Since rehires are participants and immediately eligible to participate when they are rehired, I suggest providing a one-page summary notice to rehires. The notice would inform them that they are participants and that they can have another copy of the SPD if they want one. If there were changes to the SPD while they were away, give them copies of the relevant SMM's or the most recent revision of the SPD, whatever now applies. If the employer keeps deferral rates in the payroll system, then the notice would list the deferral and investment elections that applied when the person termed and would state that those elections will continue to apply unless the rehired person files a written election change form. I would give this to all rehires, in part to remind those who didn't defer before that this is their chance to jump in and enjoy this benefit. Alternately, if the employer sets the deferral rate to 0% when people terminate, then the notice would say that (so people don't mistakenly think that what was before will continue again), and invite the rehire to make elections. At least, that's probably what I'd do.

^True, if an RMD for 2014 is paid in 2015, it adds to the person's 2015 taxable income. But the interesting question is whether an RMD is even due for 2014, that is, if an age 70-1/2 person retires on 12/31/2014 and is paid for working on their last day of work (12/31/2014), but then is not on the payroll on the 01/01/2015, is an RMD due for 2014?

I never knew the dangers I faced by watching Nicholas Cage movies in my swimming pool ... or that I would have faced if I had a swimming pool. do you supposed there are any "helpers" around when these people die by being entangled in bed sheets? Cool posting. Thanks, Mr. Rigby.

The COBRA notice is sent to the dependent who is losing coverage. Sending the notice a few weeks before coverage ends gives the person time to decide what to do next (in case it slipped their mind that they would soon be uninsured). In any case, send the notice before coverage ends. The deadline for electing COBRA is 60 days from when coverage ends, or, if later, from when the notice was sent.

For what it's worth, we have wrap document for our welfare plan and a privacy policy for the protected health information we may receive (which isn't much). We post the privacy policy on the bulletin boards and summarize it in the handbook.

This discusses some things to consider: http://www.gray-robinson.com/blog/post/779/GrayRobinson-Employee-Benefits-E-lert-Cafeteria-Plan-Amendments-and-the-Employer-Mandate

OK, say the total monthly premium for single coverage is $500. A person making $5500 a month pays 9.5% for their premium payment, which is $522.50. Who gets the $22.50? Or if the higher paid employees do not have to pay a full 9.5%, is there a potential non-discrim problem?

typo, yes? You can't just wait until November and claim unfeasibility.

Doesn't look like it: http://www.morningstar.com/advisor/t/93123895/estate-as-beneficiary-ira-vs-qualified-plan.htm But maybe, if the estate meets all the conditions for a see-through trust. Is an estate a trust under state law?

^ and you may want to have the Plan Document specifically say what Lou S said. Or it could say 'based on the most recent valuation.' The plan administrator has to take into consideration that distributions have to be fair not only to the participant receiving the distribution, but also to all the other participants. For example, if the value jumps up or down significantly (or if it's pretty obvious that it will), it may be prudent to do another valuation (I know, yuch) to get a fair price for distributions late in the year. And whatever is done, it should be done consistently in future years. As to timing in your example, for our annually-valued plan, if someone terminates in 2015, they will be paid out (if they request it) the following spring (we try to be before July), in 2016. Depending on how many hours they put in in 2015, they may participant in allocations for 2015, but that's a separate matter. The exception in our plan is that if a participant is not employed and reaches age 65, they are cashed out, as soon as practicable after the first of the month following their retirement or following the month in which they reach age 65, if later. The distribution is based on the valuation as of the end of the previous year.

I seem to recall discussions on these boards that it may be OK to issue the SH notice less than 30 days before the start of the plan year, but I can't find the posting and I don't know that it's true. If it is true, your client would need to document that the employees were given adequate notice for them to make their decisions about deferrals. The 30-day requirement is meant to allow employees at least 30 days to do their analysis and make up their minds. It may be that the client's 12 employees would not need that much time, but that's a judgement call based on the facts and circumstances. And it's not as if the rest of the month is free of distractions.

I agree with the "Why?" comments. Just for my own understanding, if the AA actually says that the option to defer 100% deferral of a bonus is regardless of the other limits, then why can't participants defer 20% of all other compensation and defer 100% of the bonus? Otherwise, would it not say 100% of the bonus, but not to exceed 20% of total compensation (including the bonus)?