Lou S.

Technically doesn't appear to be a controlled group so safest course would be to grant service with the prior entity if that's the intent.

If there is no amendment and no resolution then the Plan isn't frozen. Now if it is a choice between him searching his records to find that amendment he signed when he gave out the notice to himself or fund the accrual for 2012, he'll probably look a little harder to find that amendment he signed last year.

QNECs to pass testing can't be used in 401(a)(4) testing but safe-haror non-elective contributions that are very simialr to QNECs can be used in 401(a)(4) testing. That might be some your confussion.

I agree that I don't see anything wrong in theory. Good luck with the broker compiling the info. No personal experience with this being used as a QDIA.

It needs to be funded by 12/31/2012. After that you are in EPCRS land.

Unless you are rolling the actual loan which most plans won't allow, there is no rule that I am awre of that would allow you to continue amortization over more than 5 year in the new plan for this situtation.

Participant terminated many years ago and rolled distribution to IRA. The Ex-participant is now getting divorce and wants to get a balance as of date more than 10 year ago. Presumably to determine pre-marital portion. Is the plan under any obligation to dig though it's old records and find such a balance? The participant was paid more than 7 years ago. I'm pretty sure the answer is no they don't have to unless they want to be really nice for some reason.

No, they don't have to tell him why they gave him a $900 fully vested contribution.

Is the OPR a 401k or 403b plan where his contributions are reported as such on his W-2? If the answer is yes, then it is part of his annual 402(g) limit. A call to the OPR administartor should be able to answer the question pretty quickly. edit - if it is a mandatory contribution it is not part of his 402(g) limit. 402(g) contributions are elective contributions.

I think it would depend on how your document is drafted. Also are you refering to acutal entry in the plan or testing based on statutory exclusions?

Mike maybe I'm way off base and if so I'd like to know but with I would say the following would apply. A has Bob 100% owner, beacuse that is more than 50% adult child daughter is deemed to own 100%. B has adult daughter own 60% more than 50% and is deemed to own the 40% by Bob for 100% A & B controlled through Daughter. Unless the exceptions of 1563(e)(5)(A)-(D) apply, duaghter would similarly own 100% of C through Son-in-law 100% ownership of C. The daughter becomes the common thread in all. But maybe I've got my logic all wrong and the step that passed from daughter to parent is bad leap but I thought that went both ways.

Assuming 1 year wait dual entry they should enter 7/1/13 if 1,000 hrs between 7/1/12-60/30/13. It is a relius related issue depending on how your plan is setup. I think it might be on their FAQs, if not call them we have simialr problems on occasion. If you are processing annually and don't have them as 1000+ hours in 2012 it looks the next computation period 1/1/13-12/31/13. You can manualy fix by overwriting the "met plan entry date" field prior to running eligibility.

You are most likely going to be a conrolled group in this situation. Unless the 60% is given to the daughter and not the son-in-law AND son in law only works for C, not A or B and daugher only works for A/B and not C and daughter and son in law meet the exception on seperate unrelated business which can be a bit complicated and may depend on whether or not it is a community property state.

Thanks. That seems like a solid argument. I'm not expecting problems with this client, just want to have my ducks in a row so to speak if there are issues as another month or two of interest will likely increase their final deposit to make the plan whole by whatever that interest credit is.

Thanks I agree with that position but was wondering if there is any specific IRS guidence I can fall back on if the client wants to take a different position.

Plan has fixed interest credit credited at year end. Assume it satisfy's reasonable rate. Pay credits frozen in past so not an issue. Plan terminates partial year, say 6 months. How is intrest credit done in final year? Though date of termination? Through date of pay out? Through end of Plan year, even if a futre date? We don't want a prohibited cutback issue to crop up.

Any way to take an in-service distribution of the nonqualifying assets? That might be be your best bet.

From a deposit timimg issue you are fine. You need to get into the trust, not necessarying particiant accounts. The money is trutee directed though until you allocate it to particpant accounts so you may or may not have a fiduciary issue depending on how long the money sits and whether or not you allocate earnings on it while it sits. Presumable it is in money market making virtually zero these days.

Sounds like discrimination against an HCE which the IRS is generally cool about. DOL is usually worried about non-owner employees so I personally don't see a problem with it. But I can't say that I've ever seen it done quite like this either.

As one who once tried to live in our house with 2 small children while our sewer line was repaired and we did not have sewer or water for 3 days, I can say that that should definietly qualify as a hardship. The hotel say after day 1 was nice though.

What is the definition of compensation in the Plan document? That should tell you if you include of exclude for the basis for deferral.

How do you ignore the catch-up for top heavy? While catch-up does not count for nearly all testing limits, it is included in the participant's balance for top heavy determinations unless my understanding of the rules is compeletely off base. edit - I should have read your followup response which I agree with 100%.

B is much worse. Unless you've picked a horrific set of target date funds that have an ungodly expense ratio and/or fail to invest according to its stated goals, I think a participant would have a hard time finding a judge who would rule the trustee made an imprudent decision with the participants money by putting them in a target date fund. OTHO if you default participants to MMK you may find a lot of judges who think that is an imprudent long term investment strategy for retirement, more so with the current DOL guidence out. Especially with MMK rates near 0% even before any possible program charges.

I seem to recall that eligibility is NOT a protected benefit and you are correct in you analysis. Though as a practical matter it could be a potential PR nightmare to axe half the employees from the plan. Especially when you tell them, "by the way you aren't eligible for distributions either because you are still employed." edit - In cases like this the employer often (but not always) grandfathers those who met the prior eligibility into the plan.

This is what we've been hearing lately. In one case, it looks like the broker is not getting paid, but that's because his fee is shifted to another "category" (I really don't understand all of these kinds of fees). I think that's the point. And austin is spot on with his post. The more the expenses can now be "hid" in the exense ratios of the funds, the more it probably will be.