My 2 cents

Most of us do not consider the two to be equally awful transgressions.

Although I cannot personally vouch for it being other than an apocryphal tale, I heard that years ago at a conference from someone who I presumed was in a position to know. Mathematical literacy is not usually considered a prerequisite for membership in the US House or Senate. After all, some of those state legislators who vote in favor of defining pi as 3.0 are able to move up to national office, and if you hold your seat long enough, people (especially those in governmental positions) dare not tell you how wrong you may be.

Remember the old 1.4 combined plan limits under IRC 415 (dating myself here - they went away circa 2000) that keyed off of fractions with 1.25 in the denominator? That came about because an important legislator was convinced that 1.4 = 1 1/4, and nobody dared disabuse him of that.

In the absence of official guidance to the contrary, mathematically, 1.000000....% is not more than 1%.

1. He met the age requirement on the entry date 7/1/15. 2. Having worked 1,000 hours in the plan year 4/1/14 - 3/31/15, he met the service requirement no later than 3/31/15 (depending on how the plan is worded, it could have been prior to the last day of the plan year). In any event, as of the entry date 7/1/15, he had met the age and service requirements and would have become a participant on that date. If he were older and met the age requirement some time in 2013 or earlier, he would (depending on the exact language of the plan) probably not be able to enter until 4/1/15 because that would be the earliest quarterly entry date on which he would have met both the age and service requirements.

I am familiar with plans that specify that a year of eligibility service runs from date of hire for the first year and changes to plan years thereafter, but I don't think that I have ever heard of a plan whose Entry Dates change like that. The plan either has quarterly entry dates or it has annual entry dates, but surely it doesn't have quarterly entry dates under some circumstances and annual entry dates otherwise. The framework is to determine when the eligibility requirements are met and then enter on the first entry date on which the eligibility requirements have been met, with one set of rules establishing the date on which eligibility has been satisfied and another set of rules establishing when the entry dates occur. Entry should really be occur on the first entry date coincident with or next following, and the plan should say so. Entry should not be delayed if the person meets the eligibility requirements right on the entry date.

See what I mean? And here I have been going around all of this time thinking that "obverse" meant the side of a coin with the face and that "converse" meant something like "the opposite".

I think the word you want is "converse". Unfortunately for all of us, the English language is as complicated and hard to work with as the retirement plan rules.

Is a puzzlement! But someone said above that it is permissible for the plan to voluntarily escheat funds to the state. "Under DOL opinion letters State laws requiring escheat of property to the state are preempted by ERISA. However, plans can voluntarily escheat benefits to state abandoned property funds if the state will accept them." Maybe that would be a solution.

Unless the amount to be paid is in balance with the value of the underlying assets as of the time the distribution is to be paid, someone is being shortchanged and someone is being overpaid. Good reason to only allow distributions coincident (or nearly so) with proper valuations. If you are going to only value the assets once a year, only allow distributions once a year. Still hard to understand why, in 2016, daily valuation is not standard. Not being able to value the assets based on the market each day either points towards inadequate technical capabilities on the part of the asset holder or towards the holding of investments not suitable for a defined contribution plan covering more than one person (assuming, as someone who does not handle such plans, that hard to value/illiquid assets make more sense in one person plans than they do in plans covering more than one participant).

I had assumed that they are not invested in something without an established value and that distributions can occur throughout the year. I don't normally work with defined contribution plans and am accustomed to only seeing daily-valued assets. Perhaps the standard for annually valued plans is that all distributions are delayed until the end of year valuation, in which case there ought to be no misfit between actual value and amounts distributable.

Key point is that it is never mandatory to escheat any funds to the state from the plan.

My vote is that it was paid out and the money belongs to the estate. Paid out before death. Not the plan's fault the check was not cashed. Just being dealt with now?

Assuming that all of the investments can be readily valued, if one does not value them more or less on a daily basis, what happens to the misfit between the old, presumably out of date value and the amount of assets that need to be sold to raise the amount payable? Example: Value of person's account at the annual valuation date is $20,000. So (I presume) you are going to pay out $20,000. What happens to the extra money if you only need to sell 3/4 of that person's investments to raise $20,000? What happens if you have to sell 120% of that person's investments to raise $20,000 because of a market drop. Where does the extra 20% come from?

Just curious as to why the employer wants to complicate the window with this requirement.

Am I wrong in thinking that there could be nothing to prevent the sponsor from amending the plan and moving the money elsewhere? It's not as though investment houses are protected by IRC 411.

It would be my understanding that if one is to commute a series of payments, one would use the currently applicable 417(e) rates.

Just wondering - would an investment adviser who pledges to fashion their advice based on the needs of the investor have a competitive advantage over those whose advice tends to align better with how much they are paid for recommending a particular investment?

Do the receivables consist of anything besides receivable contributions? Funding valuations would always include contributions made for the prior plan year after the end of the prior plan year (suitably discounted, of course).

I don't work directly on 401(k) plans, but it would surprise me greatly if any pre-withdrawal investment results would be taken into account for any tax purposes. Certainly, no such thing as deducting investment losses arising under a 401(k)! Put in $10,000 and it's only worth $8,000, since there were no taxes paid on the $10,000, you don't get to deduct the $2,000 "loss" upon withdrawal.

Even if it is, maybe they will get it right this time.

Cash balance plans shouldn't be allowed to condition a year's pay credit on being employed on the last day of the year. Maybe they can, but they shouldn't be able to. A cash balance plan is not subject to the rules applicable to defined contribution plans. Don't elapsed time plans have to give credit for all periods of employment? She worked 362/365ths of a year. Does the plan say anything to indicate that to receive a pay credit for a plan year, the participant must be employed until the last day of the plan year?

So she can take the distribution under the plan provisions (apparently) AND, having separated from service after age 55 (voluntarily or otherwise), only needs to pay ordinary income taxes on the distribution. Of course, in an ideal world, she would have the distribution rolled over directly to an IRA and have no immediate tax consequences whatsoever!!!

Seems as though it must be too late - what is the statute of limitations on paying fines? Surely not forever!

I don't work on 401(k)s and also have no involvement with Roths, but wouldn't amounts contributed as Roth contributions be purely after-tax? I don't know how they interact with Social Security. Otherwise, I would go with it not mattering.