My 2 cents

For what it's worth, apparently the only thing enrolled actuaries are required to report to the government is the knowledge that an actuarial certification intended to be filed with the government has not been filed (and not any known tax evasion or fraudulent activities). Of course, there ought not to be any active involvement by the enrolled actuary in any fraud or tax-evasions.

Trying to apply some subtle humor here (probably too subtle and too negative). I meant socializing with the client after they are sentenced to prison for tax fraud. As a fellow inmate. Is it really worth your while to provide services to so sketchy a client?

Is it permissible for the unused funds to be returned to the participants (as opposed to permanently forfeited)?

I may be taking an overly cautious approach to this situation, but it is not my style to spend time socializing with my clients, especially if they are in prison for tax fraud.

Not a lawyer and not someone who practices in the small plan 401(k) arena. Just wondering - if the daughters have not ever worked for the company, not even for 5 minutes, what is being reported for hours? In the other discussion thread, at least the owner's wife would go in an do something useful on occasion. How could the company justify anything paid to the owners daughters here as compensation? Wouldn't the 401(k) contribution be limited to what was actually being paid as compensation for services rendered (as opposed to what could only otherwise be characterized as distribution of profits or even diversion of company assets by the owner). How is any aspect of this not, at best, tax fraud? As a taxpayer, I have no reason to want them to be able to do this.

Agreed. The Trust for the Plan is responsible for withholding taxes AND sending them in to the government, and both should be an integral aspect of the Trust's procedures.

Sounds wrong to me! In a DB plan termination, amounts that are paid as lump sums are subject to the 20% withholding and amounts that are directly rolled over (or annuity purchases) are not. If someone splits the distribution between a lump sum payment and an amount rolled over, then only the amount not being rolled over would be subject to the mandatory withholding. The plan should have held back 20% of the amount not being rolled over and sent the remainder to the participant and the withheld amount to the government. If it is to be sent in from the proceeds by the recipient, it isn't "withholding", is it? It makes me wonder if that was a real CPA, or someone who plays one on TV.

What if, in reviewing it prior to qualification, you just said either that you don't think you would be able to administer it or that you would expect to just subtract the 12/1/05 balance from the 9/1/16 balance and treat the difference as the amount accrued between those two dates? Do you have access to a computer that can handle parallel universe calculations? Otherwise, any attempt to apply refinements to carve out, for example, the portion of the account growth attributable to earnings on the starting balance as opposed to new contributions and investment earnings on them, must be at least slightly arbitrary. I don't know about you, but when I reallocate my 401(k) assets among the available investments, I do not consider when the money was put in - I think only of the amount in each fund and rebalance exclusively based on that. If the DRO calls for computations you are not prepared to make, you must either say "we cannot do this" or "we're not sure what you want, but this is what we are going to do..." and let the parties deal with it.

While I hope to never have to access a 5500 form from the 1980s, this looks fantastic! Thanks a million!

I am still trying to figure out why the sponsor has no interest in trying to resolve this in a way that would not lead to disqualification. Isn't disqualification just about the worst possible outcome? I thought closing agreements would not involve penalties greater than those that would apply under a disqualification.

Just wondering if there is any chance that the proposed action would constitute a fraud against the soon to be ex-spouse. Seems to me that if it would, it should be avoided if at all possible. Couldn't the plan administrator be held to have an implied fiduciary duty to the soon to be ex-spouse?

In this brave new world, how do I access all new posts (across topics) since my prior session?

Guessing force of habit, uncertainty concerning adequacy, system changes would be needed or some combination. If they send paper notices, no chance of that being treated as insufficient. Perhaps, if the employees are still paid by paper check (it's possible), inserting the notice in the envelope with the check is as easy as anything else.

I would think that if the employer requires the employee to check email on a daily basis, then access to email would be treated as "integral" enough to permit the use of email for required notices. Weekly? Not as clear. Merely assigning an email address to everyone and letting it be known that all mandatory notices will only be provided via email, a bit more nebulous, but may still be acceptable. I don't think that job must require the use of email on a two-way basis (send and receive) to permit the issuance of mandatory notices via email. That would be excessively limiting. Providing each employee access to the corporate email system (including access to a suitable computer) and, perhaps, providing employees the opportunity to specify another email address for mandated notices ought to be unquestionably enough to permit issuing notices to employees only by email.

Tough situation when Mr. Marley wants a plan and Mr. Scrooge doesn't.

If the participant count is high enough, the sponsor must obtain an audit from an independent auditor. The process by which the IRS selects plans to audit is much more mysterious. I doubt that participant count is especially relevant when it comes time for the IRS to decide which plans will be audited by them, certainly not if the participant count is somewhere around 100. While there may be situations where the 5500-SF cannot be used other than because of participant count (or where the sponsor cannot claim exemption from the audit requirement when filing the 5500-SF), I suspect that one cannot then avoid having to obtain an audit by tweaking the participant count if those situations apply.

1. Don't the MDIB restrictions flatten out for non-spouse beneficiaries (such as grandchildren)? More than 43 year difference = 52% joint continuation percentage is OK. Does the present value of benefits expected to be paid to the participant still have to be at least 50% of the total? 2. Absolutely positively, a 65 year old participant with a 30 year old spouse can elect a 100% joint form. Can an 87 year old participant with a 30 year old spouse do so? The MDIB table applying limits on the continuation percentage based on age differential is not applicable when the joint annuitant is the participant's spouse.

Hm Hmmm... No document, no filings. Are you SURE there is a 403(b) plan?

Two things: 1. I accidentally said "typewrites" instead of "typewriters" in the second paragraph. Sorry. I imagine that eventually one of the monkeys will type that paragraph without the typo. 2. Those monkeys will also undoubtedly eventually reproduce the entirety of the original poster's Excel formula. If it can be done, they will also type a version that Excel will be able to handle. For that matter, they will eventually type the full source code for Excel.

Thanks to the internet, we know this is not true. Not sure I fully grasp your point. I think the point of the expert's comment is not that the only thing that all those monkeys would produce is Shakespeare. They would produce, eventually, every episode of Two Broke Girls and I Love Lucy, the entirety of Lord of the Rings AND Harry Potter, every single comment posted by a troll this year (both the unexpurgated version and the one edited to replace some of the more egregious words or phrases with typographical symbols), every term paper you or I ever wrote, etc. And let us not forget the United States Tax Code (both the 1954 version and the 1986 version). An infinite number of monkeys, with an infinite number of typewrites and an infinite amount of time, is an awful lot getting typed. The tragedy, of course, is that when they do type Hamlet, it will be utterly without meaning to the monkeys (which makes me think, at least a little bit, about one or two of the term papers I wrote).

Reminds me of a cartoon (Rhymes with Orange) I saw two or three years ago in a newspaper. An expert posits that an infinite number of monkeys on an infinite number of typewriters with an infinite amount of time could create the complete works of Shakespeare. A monkey points out that an infinite number of monkeys over an infinite amount of time created Shakespeare himself via evolution, saying "So, duh, we've done it already." [The mathematician in me points out that, to be more accurate, it would have been a finite number of monkeys over a finite amount of time.] This discussion thread seems to have drifted somewhat off subject, hasn't it?

I don't recall the actual limits, but I think that Excel can only handle 6 or 7 levels of nesting, and there may be a 255 character limit on a single cell's coding as well. I prefer not to contemplate what my own limits may be concerning the complexity of a formula that I can follow, but I do know that Excel has limits.

No argument here about that!!!!

I am sure that you are not alone in that! If everyone has to log on again, expect lots of forgotten password inquiries!!

Rollovers probably have to come from qualified plans. That would seem to preclude rollovers from non-USA plans.