K2retire

I should probably know this, but it has not previously been an issue I've considered. Does the designation of a beneficiary other than the spouse of an employer sponsored life insurance policy require the spouse's consent? Does the answer change if it is a community property state?

Our prototype document doesn't allow for the type of contribution that Larry mentions. But I recall a situation where a plan was merging due to the company being bought out. The CDSC fees were paid to us directly by the purchasing employer.

Since most prototypes allow either safe harbor or not among their choices, amending out of safe harbor status should not take the plan from prototype to individually drafted. Are you asking because you're seeing a document that doesn't have a non safe harbor among its options?

ERISA prohibits assigning benefits from a plan. Why not just eliminate the hardship provision if it's creating problems?

Is the PS formula set in the document? It is is strictly discretionary, I think your only choice is to revise the tax return and 5500.

Using them to reduce a subsequent non elective contribution, or even a subsequent discretionary match IS a fix. I just don't believe that employer money can be used to reduce subsequent deferral deposits.

How do you handle hours of service for salaried employees for whom hours are not recorded? The answer should be the same.

I have always been under the assumption (which is backed by the document system I use) that forfeitures can never be used to cover EE contributions. Could someone please clarify if I am under the wrong impression, as a whole? Is it simply the docs that I use (DATAIR) that don't allow the forfeitures to offset EE cont.? Yes, deferrals are technically employer contributions. However to qualify as an elective contribution they cannot be deposited to the trust before they are withheld from pay. Since these funds were already deposited, they cannot be used to offset a deferral contribution.

Many companies also offer 401(k) plans for a single person employer.

I don't know that it is necessarily industry standard, but many receiving institutions won't accept the rollover if you don't have returned mail from the address that you're using.

Thanks to all!

The hearing is set for September. If approved it requires a 90 day period to become effective. This won't help anyone for 2009.

The amount of salary deferrals available for a hardship is supposed to be the cumulative salary deferrals without adjustment for gains or losses. But when there is a loss it seems like it must be adjusted because you can't distribute more than is in the account. If the only money in the account is deferral source, it's easy, but what if there is other money available? Example: cumulative deferrals $20,000, current deferral balance $13,782. The available hardship is supposed to be $20,000, but to distribute that amount would require taking $6,218 from profit sharing or match that do not allow hardship distributions. Related quandary, what about mutual fund loads? The money is not in the account, but theorietically it seems like not including the full amount withheld from pay violates the rule about not adjusting for gains or losses.

I have no idea of the answer, but I believe these are exactly the kinds of questions that have so many people up in arms about increased fee disclosure rules!

If this is a top heavy SH plan that is also making a profit sharing contribution, they will still be subject to top heavy minimums. All employer contributions can count toward that minimum.

This is a shot in the dark. Because a qualified plan pays no taxes, and reports unrealized gains or losses on the 5500 is this person thinking that the basis should be reset to match value reported on the most recent 5500 to assist in calculating the unrealized gains or losses attributable to the next year?

Or maybe it's an annually valued balance forward plan where the TPA doesn't see the investment statements until significantly after the fact.

QDROphile, what about that picky little rule that says a profit sharing plan must have substantial and recurring contributions? I've always been told that a "frozen" 401(k) plan could not exist for that reason.

And now you can also roll pre-tax money from a qualified plan directly to a Roth IRA. I believe that is was the OP asked about.

He knew (or should have known) what the rules were before he decided to make his deferrals up front. It was likely set up to avoid having to true up staff match and now he's hurt himself by not following his own rules. Frankly, I was surprised when I learned that it was permissible to not require true ups. But if you're going to play that game, it must apply to everyone.

The reason you can't amend mid-year is to prevent precisely the type of manipulation by HCEs that you are trying to accomplish.

I can see some room for discussion as to whether the gain stays with the participant or is used as a forfeiture. But to allow the TPA who was resposible for the error to benefit from it is clearly unethical.

I have neither read nor heard anything recent -- but I have encountered an real estate fund with Principal in individually directed accounts that they are refusing to liquidate.

Perhaps -- it is the only way I've ever seen a cross tested allocation group written.

You cannot change the safe harbor formula mid year. I've heard some debate that you might be able to increase the safe harbor match (which we do not permit our clients to do) but lowering the match, changing to non-elective or from non-elective to match mid year is not permitted.