JRG

A participant in a 401(k) plan currently has no designated primary beneficiary. The participant's mother has recently incurred costs for medical expenses. Can the Participant designate her Mom as her primary beneficiary and then take a hardship distribution (i.e., make the change and take a hardship distribution after the particiular medical expenses were incurred)?

Thanks!

A client in 2009 had merged the 401k plan of a subsidiary into the Parent company's 401k plan. The subsidiary 401k plan was funded in part by a GAC, which contained some assets (say 20%) which could not be liquidated at the time of the merger, and thus, the GAC still exists outside of the Parent 401k Trust (the liquid assets were liquidated and transferred to the Parent 401k). Should the subsidiary 401k plan's GAC be reported on Schedule A for the Parent 401k's Form 5500? Are there any special issues we should be aware of? Thanks.

Client has a DB plan and a Participant left employment 10 years ago, but has a vested benefit. At the time of termination the plan's only form of benefit was an annuity. 3 years ago the Plan was amended to permit participants to receive a lump-sum. Participant is about to become age 65 and wants to elect a lump-sum. My question is can the participant who terminated 10 yrs ago elect to receive their benefit in a lump-sum? Or do they have to receive an annuity based on the plan provisions at the time of termination? Thanks.

I'm pretty sure what the answer is going to be but...can an individual make a tax-free gift from their own IRA to another person's IRA? (basically a transfer)

We are doing the same thing and are wondering if there is any recent guidance on this?

Thanks for the replies, in terms actuarially increasing the benefit if a participant remains employed, this participant has not been employed since the late 1980s...would this alter the analysis if the plan provides actuarial increases for those that remain employed?

We are working on a plan in which a participant who left the company 20+ years ago never began receiving his monthly pension benefit. He was originally due a $500/month life annuity. He is now 75 and has missed 10 years of payments (and also RMDs). Do we have to actuarially increase his benefit? Or can we calculate the amount of the missed payments (+ interest) and make a payment to him in that amount and begin the $500/month annuity?

What about any imputed income for prior years? Say in 2009 it was discovered that the "spouse" received health benefits in 2007 & 2008. How would the employer go about correcting the 2007 & 2008 taxes?

Thanks.

I am having trouble understanding the benefits/reasons of having a retroactive effective date (say 1/1/2002) for an EGTRRA prototype restatement, executed for example 1/1/2009. If we made the effective date 1/1/2002, would this whipe out any nonamender defects? For example, client did not timely adopt a 401(a)(31)(B) amendment....but the provision is now correct in the new plan restatement (since plan is effective 1/1/2002 and the 401a31B amendment is in the plan document effective 3/28/2005). I would not think this would eliminate the nonamender error, but am I wrong? If it doesn't, then in theory the document is not really deemed effective in 2002. If you have a GUST prototype that has been timely amended for all required law changes....why would you not simply make your EGTRRA restatement date the date/year executed (1/1/2009)? What are the reasons to make the effective date 1/1/2002 instead of 1/1/2009?

Some clients haven't done that and wanted to use the three year window. FAB 2007-3 noted that it takes a certain amount of time for DC plans to gather information after the end of the plan year and so it extended the 45 day grace period until the date for filing Form 5500...but did not do so for defined benefit plans (or at least did not exressly say so). Has anyone received additional guidance from the DOL on this issue?

PPA 508 Amended ERISA 105 to require a DB Plan to provide a pension benefit statement at least once every three years (due for the 2009 plan year). Originally for DC plans, FAB 2006-3 gave 45 days after the plan year to provide the notice, and FAB 2007-3 extended this deadline to the date Form 5500 is filed by the plan. However, no guidance is given as to how long after the close of the plan year a DB plan has to provide the statement. Are practitioners relying on the 45 day DC plan deadline as good faith? The 120 day deadline to furnish the annual funding notice? Or another deadline? Thanks.

Company A (previously a subsidiary) was a participating employer in a 401k plan (Plan X), was later sold and set up its own Plan (Plan Y) and is now to be merged into its Parent Co.'s plan (Plan Z). It has been discovered plan X has qualification issues (non-amenders, etc.)....Is it possible (i.e., does Company A have the legal authority) to submit an EPCRS submission for itself regarding Plan X qualification failures? If not, how does Company A get rid of the nonqualification "taint" of Plan X?

Company A acquires Company B in a stock acquisition in July of 2009. Both are public companies and Company B will remain after the acquisition. The NQDC Plan of Company A uses the 415 defaults in determining compensation. In figuring out the specified employee's for the effective date on December 31, 2009, how is compensation for the employees of Company B determined, i.e., is its employees compensation based on the entire 2009 year or only after the date of the acquisition? Example: Company B employee X made $300,000 in 2009, but only $150,000 was after company B was acquired, what is his compensation for determining specified employees on December 31, 2009?