Lou S.

I agree it is perfectly legit. I do not agree that is really that simple. But if the employer doesn't mind paying for an extra plan document and 5500, sure it is fairly simple to establish a new plan.

If establishing a new plan so that one participant can now participate seems too easy, then yes I agree with you.

The Trustee should request return of the amount that was supposed to be forefited from the participant. The Plan Administartor should inform the participant of the amount that was supposed to be refund and is not eligible for rollover along with the consequenses of leaving it in the IRA. The particiant should be issued correted 1099-Rs if distribution in 2012 (or should receive 2 1099-Rs in 2013), see instructions to Form 1099-R there is a good section on exactly what to do when amounts are rolled over and later determined to be corrective distributions. TPA has not actually made any error. This can potentially happen anytime a client pays HCE employes before all testing is completed, though it might be required following the terms of the Plan Document. I wouldn't expect this correction to be covered for free by the TPA as there is a fair amount of work involved in fixing this issue and while it happens from time to time I wouldn't say it is a common issue that falls under normal and routine work.

Sure you can file paper EZ or electronic SF as 1 participant with limited questions answered.

I haven't review it in a while but I think if it is a loan default it cannot be used to satisfy RMD; but if it is a loan offset it can be used to satisfy RMD.

This might help. http://benefitslink.com/boards/index.php?/topic/5014-adp-test-in-control-groups/

From what you describe, it sounds fine.

Sounds like you need an attorney versed in such matters in volved in this. Or more precisely the acquring non-profit needs one to review this.

Good luck.

The problem is the IRS has a moronic system that requires a paper filing of Form 5558 to Utah and Electronic filing of 5500 thought the DOL and 8895-SSA through FIRE and they simply don't talk to each other quick enough.

Just a guess but APD - A Professional Dentist

You should talk to a qualified financial guy or attorney. Especially if bankruptcy is a possiblity. Generally reirement plan assets can't be touched by creditors in bankruptcy so using it to pay creditors if you are going to through bankrputcy might not be the best idea, especially since you'll also owe taxes on the distributution. If you are looking for the "least risky" investment for short-term you should talk to your plan's investment advisor.

Correct me if I'm wrong but don't DB plans have to start paying the annuity benefit to statisfy the RMD rules?

Same here. So much eaiser to tie the 1099-Rs to the distribution amount on the 5500. Though we have had a few auditors ask us for distributions requested before year end but not yet paid.

An ex-spouse is not a current spouse so you are correct.

We have auto-rollovered all balances for non-repsonsive/lost participants on plan termination, even if balance is over $5,000.

Oh, yeah forgot about that. Saw that once too. As for your original question, not sure if the plan is really considered qualified by the IRS or not but I have seen it done on occasion. I suppose you do run some risk on audit or if applying for DL.

The only time I've seen it is when it is a small owner only plan that wants to invest in non-traditional assets, usually mortgages to unrealted thrid parties or real-estate and the cost of administering a plan is much smaller than the asset fees to an IRA trustee holding non-traditional assest but otherwise, I agree with jpod.

A qualified plan can always discrimate against HCEs and an employer with no NHCEs pases testing automatically. No problem at all with cross-tested contribution in this case, seperate groups seems the most flexible.

Great question. No clue on the answer.

Unless the submit an affirmative deferral election percentage I would assume they remain in the default election. That is investment direction is separate from deferral election.

Not yet but sure sounds like something the IRS would do. Every year seems we get a few notices of late filing for plans properly on extension.

The documents I've seen 5.4% are written something like 80% of the TWB + $1 or 80.01% of TWB. As far back as I can recall exactly 80% limits you to 4.3% disparity, even back in 1995.

Have you talked to an employement attorney with ERISA experience?

Why do you hate freedom?