Dazednconfused

Plan allows for safe harbor hardships, participant paid for medical expenses in prior years with a loan taken from bank. Now participant wants to pay for loan with hardship distribution. Would this fall under a safe harbor hardship rule?

Wondering if anyone has ran into this (I imagine someone has), how is a hardship calculated from the deferral source if no contribution history was provided at the original take over date? So it looks like we took over plan back in 2002 and have deferral 'transfer' in balance of $4k, I have no idea how much of this was contributions, the employer does not have records going back that far. From there on out we do have records. Is there any guidance out there to these situations? Thanks!

Plan PS contributions are at the 25% deductible limit of total participant comp for the ER. Document states FF are to be reallocated. If I reallocate FF total allocations are about 26.5% of total comp. The ER will only deduce the 25% and no participant will go over the individual limits. Is there any issues with this? I am thinking that it is ok since they are only deducting the 25%... Thanks,

Does a DC plan's SAR need to report the termanted participants vested benefits due ? I know it reports beneifts paid however not finding much on this. Thanks,

The Trustee simply said they didn't want them to take their money from the plan, no other valid reason was given by him. I will certainly discuss that this is allowed by the plan and they have the right to the distribution per the document. I just don't think that I have run into this before and was wondering if others have... Thanks,

Plan is converting to different investment company, plan allows for in-service withdawals at 59 1/2 for all money sources. A participant does not want to change and just turned 60 and wants to roll out into IRA with current investment company before the conversion. However, the Trustee does not want to sign paperwork to authorize the in-service withdrawal. Anyone run into this before and what to do (yes, I guess I can say call the DOL but want to try to avoid that) ? Thanks!

I haven't found any type of language in document. I agree on the other issues that this may create, gotta love this business. One last thing, if I refund the acp excess before the actual deposit (annual deposit for er match), it would make sense that I don't need to calculate g/l and could return only the failure...but then again what do I know. Is there any regs out there regarding ? Thanks again Tom.

Yes, it is drafted to exclude under the limit, so even if they are participant and met elig. requirements in 2010, and under the comp limit, they can be excluded for contributions for 2011 I think I got it (more use to the DC world sorry for the simple questions time to go buy a book I guess..) Take care.

Thanks Tom, Follow up question to the ACP refund, if the ER funds annually and has yet to fund the match (I want to dist'b acp failure before 2 1/2 month) so correction before the actual funding of the match. Can the ER reduce the match by the acp refund amount? Lets say the match due for participant is $200, $50 needs to be dist'b for acp failure but they have not funded yet. Can the ER only fund $150? I say no that the full amount due needs to be funded. Even though in this case I am trying to correct before the actual match is funded, the ER is not happy with me... Thanks again.

One more follow up, if the person earned $10k in 2010, then in 2011 earned below the $550 comp limit, they would not be eligible for a contribution in 2011 correct? Thanks again!

SEP has elected one year of service out of the preceding 5 years, if hired in 2010 and worked any hours, would that person become eligible in 2010 or 2011 for contributions? I think they would become eligible for contributions in 2011, if they work that is.. Thanks,

Plan has failed ADP test, the excess deferrals are distributed within 2 1/2 months. When calculating the Disc Match is the ADP excess included for the allocation of the Match (that is calc the match off the participants total deferral amount) ? The ACP does fail, but if it doesn't include the ADP excess it reduces the ER match total. My thought is yes, include all deferrals for the plan year but I was wondering if there is some special rule regarding distribution of the excess within the 2 1/2 month that I don't know about and calculating the Match for the year (it is funded annually). Looking through regs now for somethign regarding this. Thanks all

Plan is pooled and has yearly valuations on 9/30/10. Distribution timing states 'as soon as administratively feasible following the time specified below', which then has 'immediately following severance' checked. If a participant term'd on 11/1/10, submitted paperwork, I think that the distribution should be processed (based on prior 9/30/10 val) and if any other, EE, ER contributions come in for the current plan year pay them a second distribution (if needed) upon completion of the next valuation on 9/30/11. Normally I think this type of plan set up should have 'next valuation' for distribution timing but not the case here. Even though it is a yearly valuation, I don't think it would be 'administratively feasible' to make a participant wait until the next valuation, almost a year with the immediately following severance option selected. Just wondering how others approach this one. Thanks all!

Thanks again! I will look into.

Thanks! Well, no schedule was made, pretty sure no payments were made (withdrawal over one year ago), just a nightmare. So is VCP still an option?

Plan does not allow for loans, however, participant (HCE) took one anyway, was not discovered until the yearly valuation completed. I would consider this an ineligible distribution rather than a deemed distribution, since loans not allowed, so what corrective steps would be needed, that is which correction program would I use to right the ship. Thanks

Does workers compensation count as compensation (in which the ee could have deferrals withheld and contributions allocated based on that comp)? I am 99.9% sure that it does not since it is not being paid by the ER. Thanks,

Thanks! Yes, file the 5500-SF, I just forgot about that while writing question.

Plan has 139 participants at the BOY in 2008, 126 in 2009, and 118 for 2010, so the plan falls under the audit requirements for those years and the Schedule H filed. However, we are estimating that the count will be about 90-95 participants as of the BOY for 2011. It is my understanding that if the count falls below 100, the audit is not required, is this correct (some disagreement in our office, some say must be below 80 to get out of audit)? For the 2011 year which Schedule will need to be filed the H or I? Or is there a choice do to the 80-120... I believe they could file the I because there is no audit required... Thanks all!

Goes to non keys, thanks!

Former participant wants to take a distribution but would like the check made out to his spouse. Is this permissible? If so, I would think 1099r reporting would be under the participant of the plan and not the spouse receiving the check? Thanks,

Plan is TH For 2009 (TH in 2008), question regarding the allocation for TH. Lets say the key makes a deferral contribution (and no other er contributions are made) of 5% of comp, my understanding is that then all P's eligible for a TH will receive 3% TH contribution (based on full yr comp). However, if the key defers only 2%, then all eligible P's will receive a 2% TH allocation since this is the highest percentage for the key, is this correct?

Thanks! I was somewhat afraid of that Just found the reg too.. ugh! thanks again.

Plan has a 8/31/10 year end valuation yearly, for the 2010 rmd which account balance would I use, the 8/31/09 or the most recent 8/31/10? Thanks

We have a small 401k PS Plan that is terminating, I know a resolution is needed for termination. However, I am unclear what type of notice is required for participants in a DC plan. Are they required to receive the 204h notice reduction of benefits? Is there any other notices that they need stating the plan is terminating? Thanks all.