My 2 cents

Are you saying that you have been sitting on the requested information for months or that the DOL has been and now wants further information on an instantaneous basis? Grammatically, your question implies the former. If the DOL had been given information on a timely basis but now wants more, is there no method to request an extension?

It would probably be best practice if a good faith effort was made to find the participant the first time it was realized that the old address was no good. It doesn't usually get easier to find them if one chooses to wait until benefits are due to be paid. Whatever statements have to be routinely delivered (quarterly account information and Summary Annual Reports for a defined contribution plan, annual funding notices for a defined benefit plan), things will just go that much more smoothly if one actively tries to keep track of where all of the plan participants are.

What, the deemed cash out of the $0 vested amount? In a deemed cash out, no money would actually have been paid to the participant (wouldn't be "deemed" if there was any money paid), and in any event, wouldn't it be the participant who would have to return the deemed cash out of $0 to the plan? Perhaps your plan says that the amount that was deemed to have been forfeited in connection with the deemed cash out of $0 has to actually be put back into the participant's account.

Can the plan require the completion of a year of service (i.e., a plan year with 1,000 hours) before things happen after rehire?

Probably would be appropriate to reduce the total benefit (with the new service) by the present value of the payments already made and revise the early retirement reduction. Both aspects would presumably be part of there being a new annuity start date. Is the plan totally silent on all relevant aspects? Says nothing about stopping payments while reemployed? How to handle the restart? Probably ought to get an official interpretation of the ambiguous aspects of the plan from the plan administrator (unless you are or want to be a plan fiduciary).

If the return to work was prior to NRA and payments are stopped, probably have to have a new benefit commencement date (and spousal consent etc.) when payments restart.

Not sure if I understand the distinction, especially in this context. If the service provider issued the payment in January 2016, it could not have been received in December 2015. If the service provider issued the payment in December 2015, it would have been reported on a 2015 Form 1099-R even if the payment itself was not received until January, but that is the opposite of what was wanted here. The fact that the first mandatory distribution relates to 2015 would never serve, by itself, to make the distribution one that was distributed in 2015. Even though required for 2015, distributions made on or shortly before April 1, 2016 would unquestionably be taxed in 2016.

My guess - 415 worries stay, 401(a)(4) worries go.

If it was processed and paid in January 2016, irrespective of the participant having wanted it to be a 2015 tax event, it's a 2016 tax event, right? One cannot go back in time and have the payout occur in 2015 if it didn't. Where is the ambiguity here? Also, it might have happened, rather than "incorrect information and service provider error", because the service provider's procedures only allow distributions on the first business day of a calendar month and the claim was not submitted early enough to make it into the December 1 distributions.

Does the plan itself provide a definition of "owner" sufficient to make the status of the owner's son unambiguous? It should.

If one freezes a defined contribution plan, there is no further need in general to make any further contributions. This is NOT the case for a defined benefit plan! Your question brings to mind the following: Someone asks you (presuming that you are not a medical professional) what to do about another person running a fever of 103.5 degrees. What is missing is both the necessary expertise and credentials to provide any useful advice. Whoever is/was the enrolled actuary for the 2015 plan year (and someone must be the plan's enrolled actuary) is the person who can say what the required contribution is for 2015. The fact that the plan is frozen certainly does not eliminate the need to continue making contributions (even if they may be at a lower level)! Knowing nothing more than (a) the plan froze 1/1/15 and (b) after using some of the credit balance for 2014, $60,000 was the remaining credit balance as of 1/1/14, the minimum cash contribution for 2015 could range from $0 (if, for example, the minimum required contribution for 2015 is less than the accumulated value as of 2015 of last year's credit balance - which could be more or less than $60,000 - and the sponsor elects to apply it for the 2015 minimum contribution) to $10,000,000 (or more!). The 2015 contribution will consist of the Target Normal Cost (which, given the freeze, is likely to equal the anticipated expenses to be paid from the fund in 2015) plus any amounts due for shortfall amortizations. Really and truly, only the plan's enrolled actuary can answer such a question! Has an actuarial valuation report for the plan year beginning January 1, 2015 been prepared? You may be able to get something of an idea from that. If not, there is no possible alternative but to obtain one from the plan's enrolled actuary.

The IRS certainly requires that the separation from service be bona fide to keep a distribution from being an impermissible in-service distribution. Returning to the same work in a short time undercuts the assertion that the separation was bona fide. Perhaps the plan should have a provision that disqualifies a "retiring" participant from any covered employment in the area under the collective bargaining agreement for a year or two. How many multiemployer plans allow lump sums in the first place?

How do you sell stock right on January 1? The markets are all closed.

Ah, the intricacies of parliamentary procedure. Why was the Committee on Homeland Security and Governmental Affairs critiquing the DOL proposed fiduciary rules? Your guess is as good as mine, and I don't have one.

Would you get an independent appraisal from a farmer or from another goat?

Two chickens and a goat.

I may be wrong, but I don't think you ever have to take into account whether someone will become an HCE due to future earnings. In this case, if you are counting service before the acquisition, do you have to also take into account earnings before the acquisition to determine HCE status? I may be wrong here, also, but couldn't ownership, if it comes into play, affect the HCE determination before there are enough earnings to make the person an HCE based on earnings?

The participant found the 1099R and shared it with the plan?? Whose side were they on? Let it be understood, however, that I certainly agree it was the right thing to do.

Absent good information to the contrary, plan participants would normally be assumed to have completed 1,000 hours of service by mid-June. But much will come down to what the plan says and what the freeze amendment says. The freeze amendment certainly ought to provide at least as generous an accrual through the freeze date as the plan would have provided (although, depending on plan language, it would not be necessary, for example, to recognize prorata credit if the plan only provides prorata credit in the event that the participant terminated in a plan year - unless they already had terminated as of the freeze date - or for the year of plan termination - unless the plan is terminating coincident with the benefit freeze).

"First, the "forever" standard is part of ERISA - maintain records as long as necessary to determine benefits payable - and frankly, it isn't that burdensome. Buy another hard drive or rent some cloud space on another server." Sure, easy to say now! We are all talking about something that happened (or, possibly, didn't happen) 20 years ago. Back then, computers had hard drives that could hold 20 megabytes (soon to jump to over 100!), and the only clouds were in the sky (and, depending on the season, might rain or snow). If you tried hard enough, you could save documents on floppy discs that held 1.4 megabytes of data. Most records then were kept on paper. So if the employer wanted to keep complete records forever but 18 years ago they were all destroyed in a flood or fire, how does the employer prove that the person has already been paid? And is "forever" forever when someone's benefit was already paid out?

...or the sole proprietor is an attorney. Somehow that reminds me of the old saying that an attorney who represents himself has a fool for a client!

What does the sole proprietor's legal advisor say? Oh yeah, judging from the original post, the sole proprietor obviously doesn't have one, or everything would have been handled differently!

Agreed. One has to presume that if that person was paid out 20 years ago and the employer lacks records to prove it, the same would be true for everyone else who was paid out back then. The line forms outside HR! Also, don't forget that the obligation to pay would be the plan's, not the employer's. Didn't I see some sort of court case a year or two ago that indicated that the money would have to be taken from everyone else's account?

Don't most companies purge their records after 7-10 years? While keeping records forever might be commendable, is it ever done?

Good luck finding plan sponsors who are worrying about 20 years from now! As for the statement from 1993: a. Does it say that the participant was vested? Maybe they were not vested based on the plan provisions at the time. b. Assuming that the amount is worth the participant filing suit for payment, how do courts react to assertions like "We have no account for this person. If they didn't already received whatever they were entitled to, we would still be holding an account." Or "Our administrative practices called for paying people out when they stopped working for us, and we would have done the same for this person." Is there a bona fide threat of litigation? Does the sponsor at least have personnel records showing when the person was hired and when they terminated? Why isn't there some sort of statue of limitations exonerating the plan sponsor when the events happened very long ago?