NQS

Thanks C.B. for your response. I agree with your understanding of 3608 regarding required minimum contributions. It is also consistent with relief provided defined benefit plans in the past. However even though, I assume, there are not many money purchase plans still around, I think relief should be provided in this area. Also, I note that some sources describing the relief on contributions to defined benefit plans to 1/1/2001 characterize this relief as simply to pension plans (and leave out "defined benefit" from their description).

My understanding is that the extension of the deadline for Required Minimum Contributions until 1/1/2021 is only for defined benefit plans and does not include money purchase pension plans. Am I correct?

Perhaps, my question wasn’t clear. I was only concerned about the time at which distributions commence as stated on the participant’s 242b election form. I believe the participant’s form satisfies the other requirements of Notice 83-23 regarding 242(b) election forms (the method of distribution, etc.) My understanding is that under 401(a)(9) of the I.R.C.as in effect immediately prior to TEFRA, required minimum distributions could be deferred until the later of age 70 ½ or retirement. The participant signed a 242(b) TEFRA election in 1983 that included the following language: “ I elect that benefits be paid to me at the latest age at which such benefit will not cause this election to violate Section 401(a)(9) of the Internal Revenue Code of 1954, as amended, (“Code”) and as in effect immediately prior to the effective date of the Tax Equity and Fiscal Responsibility Act of 1982, (“TEFRA”). “ The above election, I believe satisfies the 242(b) requirement regarding the time at which the distribution will commence, although indirectly by reference to the Code. Does anyone disagree? Thank you

Because I have heard that the IRS is fairly stringent regarding the validity of 242(b) elections, I am hesitant about giving the go-ahead on a particular one. The participant signed a 242(b) TEFRA election 12/29/83. He turned 70 ½ this year, 2013. My question is whether his election meets the requirements of 242(b) regarding “the time at which the distribution will commence”. The 242(b) signed form says: “ I elect that benefits be paid to me at the latest age at which such benefit will not cause this election to violate Section 401(a)(9) of the Internal Revenue Code of 1954, as amended, (“Code”) and as in effect immediately prior to the effective date of the Tax Equity and Fiscal Responsibility Act of 1982, (“TEFRA”). “ Although I am not sure this is relevant, the client's last pre-TEFRA document (1981) defines the latest commencement date for the payment of retirement benefits as the later of the date the Participant attained the Normal Retirement Date or the date the participant terminated employment. Is the above a valid 242(b) election regarding the time at which a distribution will commence?

I guess I am not sure of what this Notice means at this point: 1. I assume that 5558 would come under the 5500s and that 1096 and even 945 would come under the 1099s. Agree/Disagree? 2. Form 5330 seems to present a problem. I assume many of us (Enrolled Actuaries, Enrolled Agents, etc.) get involved with preparing 5330s for our clients. Does that mean if we prepare a 5330 for a client after December 31st without obtaining a PTIN we will have a problem with the IRS?

It seems to me that it is still not entirely clear if the 5500 forms are tax returns or information forms. Also, there seem to be risks for obtaining or not obtaining a PTIN number for certain employees. The IRS Page, "New PTIN Requirements for Tax Return Preparers" " requires all paid tax return preparers... apply.. for a PTIN...before preparing any federal tax returns in 2011". Does this mean that if we hold off preparing 5500 forms from January 1st on until the entire situation becomes clearer, there are no penalties or problems for delaying applications for PTIN numbers past December 31st? In this regard, if we continue to complete 5500 forms directly on the Efast site or on our 5500 form software but do not submit them are we considered to be "preparing" 5500 forms?

Haven't heard anything, but am wondering how long it is taking for the employer to get an approval letter back on an extension for the 2009 year.

Please ignore this message-I would like to delete it. If I can do so, please let me know NQS

Andy, thanks for the response. While I basically agree with it, I don’t think the instructions for the 5500 forms are 100% clear regarding plan features. I would like to provide the following examples regarding codes; any comments on coding line 8A in general or with respect to examples below would be appreciated. 1. I believe the codes on line 8A are meant to indicate features that are available during the current plan year, whether or not there are accounts in the plan that contain these features. In this regard: A. If a plan allowed for after-tax employee contributions (or even matching contributions) in the past, but no longer does so during the current plan year, I feel code 2K will not apply, even if there are participants who still have accounts containing past after-tax employee contributions. B. My interpretation in the example above would, with respect to a post by MSmith on June 9 regarding code 2T, imply that basically all participant-directed 401k plans should use the code 2T. I agree with MSmith’s implication that this would make no sense. 2. I think there are other areas in which the Codes to be used for 8A are not 100% clear. As an example, if you have an age-weighted profit sharing plan, I assume both codes 2A and 2E should be used. Is this correct/was it intended? Thanks for any responses.

It is my understanding that if a plan characteristic exists (e.g., is contained in the Plan Document), then that characteristic/feature should be coded appropriately on line 8a. There are instances, however, in which a plan characteristic is available but has never been used. For example, a 401(k) plan may allow for a discretionary match with no matching contributions having ever been made to-date. The same can be said of after-tax employee contributions or employer profit sharing contributions to a 401(k) plan. Is it necessary to code these as characteristics on line 8a prior to their actual use?