SMB

Yeah - I checked it out myself. Seems to be sorely lacking in plan provision "options". Just goes ta show ya that there's no substitute for a knowledgeable consultant...

Tom, Guess that sort of makes sense, now that I think about it. If the participant had taken his distribution in January of this year - i.e., before his demise - it would have been based of the age he "would have attained" in 2010. SmB

Participant who has been receiving required minimum distributions dies before his 2010 birthday. For his 2010 RMD, do I use his actual age as of his date of death (79) or the age he would have attained in 2010 (80) had he lived? Thanks!

Think I may have found the answer to my question. Per the EOB, "The designated beneficiary must be an individual...designated either by the participant or by the plan document." Works for me!

For a non-spouse beneficiary to be able to roll over a distribution to an inherited IRA, must such a non-spouse beneficiary be a "designated" beneficiary - i.e., had been specifically designated as a beneficiary by the participant? I have a situation where a deceased participant did not have a beneficiary designation. Benefits are to be paid equally to her parents and a sibling per plan provisions and state probate statute. Since these beneficiaries were not, per se, "designated" as such by the deceased participant, are the distributions eligible for non-spousal rollover? Thanks for any and all replies and/or comments.

401king, Thanks for your reply. That was my assumption, also. However, I've been in this business long enough to now that what may seem "obvious" isn't always necessarily so! SmB

Client sponsors a safe-harbor 401(k) plan (using the 3% employer non-elective). The Plan has an end-of-year employment requirement to receive the "discretionary" employer contribution. Owner would like to pre-fund some of the employer contribution for the year. Actually, he'd like to make his entire salary deferral contribution and pre-fund his entire employer contribution. I am certainly comfortable with his pre-funding the 3% safe-harbor for all participants based on participant comp to date, since there is no service or EOY requirement to receive same. He obviously can't pre-fund any of the staff participants' "discretionary" contribution, as he won't know until December 31st who's still employed and eligible for same. Curious, though, whether his pre-funding his entire discretionary contribution would be considered blatantly/possibly discriminatory? Thanks for any and all input.

My apologies if this has been addresed previously. Have a client with a DC plan under which the business owner is currently the only eligible participant. The business has a couple of other "employees", but they never receive enough credited Hours of Service (intentionally) to become eligible to participate. Wondering if this plan is eligible to file an IRS Form 5500-EZ vs. -SF. The business owner is obviously the only one "benefitting" under the plan, but I'm not sure if she would also be considered the only one "covered". Thoughts?

I have always had withholding checks issued to the "Financial Agent - Federal Tax Deposit Processing", sent to me (TPA) and I mail in the deposit and 8109-B coupon - with a self-address stamped return envelope and request (and have nearly always received) a "receipt stamped" copy of my transmittal letter. Has worked well for me, but I also deal exclusively with "micro" plans and a limited number of "cash" distributions requiring withholding. However, it's not much extra (billable) effort - and can sure save a lot of aggrevation down the line!

Does anyone have (and would be willing to share) or have a link to a "bullet point" summary of qualified plan provisions impacted by EGTRRA, PPA, etc.? Thanks!

Thanks -suspected as much. And, probably not - unless something relating to RMD waivers for 2010 comes out really soon.

Participant retires in 2010, the year in which she also attains age 70 1/2. She is requesting a direct rollover of her PS Plan balance to an IRA. Must she receive her 2010 RMD from the Plan before her rollover is processed? Or, since she could defer her initial RMD until 04/01/2011, could she, instead, opt to have her 2010 RMD paid from her rollover IRA?

I'm a "401(a)" person, so pardon my ignorance - Are there now 403(b) "prototype" documents available for adoption by sponsoring employers? If so, I would appreciate any info as to providers of same that any one is willing to offer. Thanks!

J, So, if there were "numismatic" value, would make such coins "collectible" versus a "commodity"? SmB

New one on me... Client is the Trustee of a PS Plan. Investments are pooled Trustee-directed. Trustee is considering purchasing as a trust investment U.S. silver coins minted in 1964 or earlier (which apparently have significant silver content). I was surprised to find that there does not seem to be an outright prohibition on investing in same - assuming it otherwise meets prudence and diversification requirements. I even came across a website that will value silver coins, based on the type and number of coins and the current price of silver - so valuation not an issue. Anyone had any experience with such? Thanks!

Here's a new twist - Client received the official "Your request was approved." letter from IRS for a timely submitted Form 5558 filed extending Form 5500 due date on a 12/31/2008 plan year end to 10/15/2009. However, the IRS letter was dated 02/08/2010! Our tax dollars at work, eh?!

Below Ground, Also, Sch. C only required for "large" (i.e., 100+ participant) plans.

A client (consisting of business owner and 1 employee) has maintained a PS Plan for years. PS Plan has a 2 Years of Service requirement for eligibility to participate, with 100% immediate vesting. Employee (thus far) has never been credited with 1,000 Hours of Service. Consequently, only the business owner has been covered by the PS Plan to date. Owner is appproaching retirement age and is considering adding a 401(k) component to maximize/optimize her contributions from here on out. I realize that eligibility to participate in the 401(k) component cannot exceed 1 Year of Service, although the plan will continue to require 2 Years of Service for the "profit sharing" component. I am going to recommend that this client go safe-harbor 401(k), using the 3% safe-harbor non-elective contribution only for NHCE participants (i.e., to both eliminate ADP testing and meet T-H minimum contribution requirement). Then, IF her employee were ever to complete 1 Year of Service (she's been getting closer and closer to the magic 1 ,000 hours mark) and become eligible for the 401(k) and employer 3% safe-harbor components, I am assuming (hoping?) that there would be no non-discrimination or other issues with the profit sharing component, since the employee had not completed the 2 Years of Service requirement for same? In other words, if the employee were to become eligible for 401(k) and safe-harbor - no biggie. Profit sharing, however, would be an entirely different story. Seems obvious - but I've been tripped up by the seemingly obvious before! Thanks for any and all input.

It is my understanding that, pursuant to Notice 2009-82, a participant who received a "purported" 2009 RMD in 2009 may do an indirect rollover to an IRA or eligible employer plan of all or any portion of such distribution by the later of November 30, 2009 or the date 60 days following receipt of the distribution. Assuming my understanding is correct, may such a rollover be made back into the plan from whence the distribution was made?

I want to re-open this discussion in light of a similar situation I am facing, as well as another "take" on the adequate security issue. A participant has already taken a loan (current loan balance $40,000) and has additional non-loan investments of $100,000 (i.e., total account balance of $140,000). Investments are participant-directed. The participant qualifies for a hardship distribution, where the documented "financial need" actually exceeds his current non-loan balance. "The ERISA Outline Book" would seem to indicate that subsequent distributions from a participant's account would NOT affect the adequate security (i.e., loan not to exceed 50% of vested balance) requirement, as long as that requirement was met at the time the loan was made, such that this participant could receive the entire remaining balance of his account in the form of a hardship distribution, leaving the loan as the only account asset (plus future loan payments and contributions). Yes? No? Maybe?

Is there a resource for an MS Word version of the new notices than can downloaded or copied and saved and edited?

If I remember correctly, a rollover from a Roth IRA to a 401(k) Plan (with "designated Roth" provisions) was initially NOT allowed. Has this changed under the current regs? (I have a client with an owner-only 401(k) Plan with designated Roth provisions who wants to roll his Roth IRA funds into his 401(k) Plan to consolidate investments.) Thanks!

Might anyone have a set of "facts & circumstances" hardship guidelines that they'd be willing to share? Simply trying to get an idea of just how best to approach.

Anybody?

I know I have seen many "ideas" bandied about in recent months, but have there actually been any additional exceptions to the 10% premature distribution penalty (on distributions from IRAs and/or qualified plans) actually authorized by Congress/IRS as a result of the current "economic crisis? Thanks!