Bill Presson

IF you have an employer EIN (not ss#) and you are at John Hancock, I don't think there is a requirement to get a plan/trust EIN. But that's not what you asked.

I'm almost positive that the owner is required to get an EIN for the plan, whether they are producing 1099's or not. But I haven't been able to put my hands on the backup for that. I'll keep looking today as I have time.

Doesn't matter what you do because you can't bill for it.

But the tests themselves have changed quite a bit as well. I got my QPA in 1991. You think it's the same test today? Of course not. But I don't "rank" people based on when they earned the designation.

On another note, those are interesting plan provisions. When would someone hired full time on 8/15/2011 enter the plan? 7/1/2013; here is the service provision: For purposes of Non Elective Contributions, after having completed a Year of Service, an Employee shall begin participation on the first Entry Date following the six month anniversary of his or her Employment Commencement Date with the Employer provided, however, that he or she shall become an Eligible Employer no later than upon the completion of 1,000 Hours of Service within a 12 consecutive month period and the attainment of the minimum age requirement, if any. I say 7/1/2012. Completes the year of service on 8/15/12 and would enter on the "first Entry Date following the six month anniversary of his or her Employment Commencement Date". That date is 2/15/12 and the first entry date is 7/1/12. This appears to approximate a one year; nearest entry date provision, but it's pretty crappy wording if you ask me.

Before I did a lot of work "correcting" this, I would do a little on a spreadsheet to see what the net impact was to a handful of employees. Because you basically went to the forfeiture account, deducted fees, allocated forfeitures and ended up with a participant account balance. What should have happened is look to the forfeiture account, allocate forfeitures, deduct fees and end up with a participant account balance. Do some and see how far off you are. You might be able to do a nominal correction; rather than reversing and reposting everything.

Hopefully for the 8 employee plan, the employer will look even harder and find the signed copy. For the 230 employee plan, does the CPA have a copy that they used for the audit?

Got the same thing from Accudraft. What a waste of time. (not directed at Accudraft or Relius, but our stupid government.)

Obviously, it's the Plan Administrator's (read Employer's) final decision, but if a participant has a letter from the mortgage company indicating "pay or we start the foreclosure process", we've always recommended approval. We've also had some of them reviewed on audit by both IRS/DOL without any issue whatsoever. I wouldn't do it without something in writing from the mortgage company, but I don't understand some of the harsh stances here. Just how close are you wanting people to get to foreclosure before "rescuing" them?

When the employee contacted the benefits dept and they said there was no election, they should have insisted on having the employee completing one at that time which would have greatly mitigated their liability. Pretty silly when an employee points something out and HR does nothing.

Can some one point me to the relevant regulation that says the final year will be a short plan year. Thank you See page 4, bottom left, short plan years. http://www.dol.gov/ebsa/pdf/2010-5500inst.pdf

Just thinking out loud here: 1. A first day requirement still wouldn't eliminate a top heavy contribution requirement 2. We often use 1000 hours in conjunction with the last day requirement which gets you most of the way there

Yes.

I have no issue with forfeitures not offsetting salary deferrals, but the rest of their current stance is just stupid. It's a way to increase administrative headaches without actually accomplishing anyting.

Obviously, we know very little about the business or plan design in your situation, but making contributions for some employees and not others can be perfectly legal and a very attractive option. In the past, we've installed plans for fast food franchises that would do this extensively. We excluded all highly compensated employees and anyone that wasn't an assistant manager or manager (as long as they weren't also an HCE). We would then have a plan covering 40-70 people and the business could contribute as much or as little as they wanted. This kind of plan works really well when the owners aren't looking to benefit from the plan. So, it can be done. Should it be done is another question because there can be some political fallout.

Ironic that the DOL doesn't consider this to be true when an employer sends a check to a custodial account. If it hasn't cleared the bank, it doesn't count.

QDROphile got back to this before I could, but that's the direction I was heading with my questions. You've got a chance to pull this out, but you're definitely going to need legal assistance.

Can you explain this part in any more detail? What did they do to "set up the plan" at that time?

Or ever...

The best way is to post random questions on unrelated message boards. That always causes lots of people to send you money.

Agreed. Let's see what we can do about this.

Austin, our Dallas office does some of this, but we're phasing out of it. After watching what they were doing for the past 9 months, I realized that unless you are doing a lot of it and it is highly automated, it's very difficult to make money. The biggest issues we faced were the actual movement of the money. We had a "bin" set up at Mid Atlantic Trust. All of the money would be deposited there. With schools and governmental entities, it's very difficult to get agreement to do an ACH, so they would all send checks. When we get the payroll file, we have to process where the investment elections say the money needs to go. It can easily be 5-8 different places. You need to then get the money from your centralized "bin" to the investment providers. There is a cost for each transaction. There is also some amount of time delay (depending on wire/check, etc.) in getting the money actually invested. You also have to determine what kind of "back up" you are going to send to each provider so they know how and for whom to invest the money. So we've decided that we are probably going to reduce our plans like this. Just FYI. Good luck.

We will generally give the employer two options: 1. Fix every return 2. Fix the most recent one by amending and putting the correct number and showing that prior returns were filed under the other number. Most choose 2. It may not be the perfect answer, but we think it helps set things right.

With welfare plans, generally audits are only required if the assets are held in trust.

The deposit was not for me - but for other employees that are involved in 2010. December of 2010 he ammended the plan so the 3% contributions would not be mandatory. Thanks for reading and responding. I appreciate it. Ok. The wording just made it appear that we were just talking about your account. No employer should be allowed to get away with this and the TPA should either get him to fix it or resign.