k man

i agree. the rev. proc says you should not return the deferrals but i think you could handle it like a 402(g) excess.

what is the proper way to handle the return of deferrals from a participant that was not eligible to make them. since it is after the april 15 deadline is it treated the same as a return of a deferrals in excess of the 402(g) limit?

i dont think we are going to request service approval. but i think the deferrals plus earnings is the best method.

client has a 401(k). a distribution was made to an HCE of amounts attributable to his deferrals. he has not attained 59 1/2 and there is no hardship. what would the proper correction method be? i cant find it in the revenu procedure.

the irs might apply the deemed coda regs. you cant give an employee a choice to put his profit sharing in the plan or take it in cash.

i am trying to resolve a similar question. i believe the code is clear and that you are correct. however, i would like to know whether the employer has to continue filing 5500's.

Ok. I really am confused about how one gets out of this. the plan is a 403(b) with employer money. the accounts are cutodial mutual fund accounts. can you confirm whether the plan can be terminated and whether the participants can take distributions of their entire accounts or just the employer accounts. also, whether or not the employer can file a final 5500 at some point.

i just read the regs over again and i see that the test is vote or value. thus, i think my guys are key. no need for anyone to answer this thread.

I need a second or third opinion. sponsor has a class of equity shareholders that have voting rights but due to a side agreement among the class of shareholders and the majority shareholder, they are not allowed to vote the shares for the next ten years. do you think these shareholders must still be considered owning 1% of the combined voting power under 416?

there is nothing in the code as long as the plan allows it.

a set up fee is not interest so there is no application of the usary rules. fees must be reasonable but 100 is probobly not unreasonable.

only reason is if company A's plan does not accept rollovers. also company A might want to see evidence that the money is coming from a qualified plan.

Why would they be required to distribute a 204(h) notice? there are no mandatory contributions. there would be no need for an amendment unless the contribution was mandatory. i think it is a discretionary contribution.

i dont know alot about 403(b)'s but i remember doing some research and seeing that you really can't terminate a 403(b) plan. does anyone know whether you can terminate a 403(b) and if so the methodolgy? this particular plan has both employer contributions and deferrals.

i dont think it matters whether it is an embassy per se. it matters whether they are an employer. if they have employees that have us source income they might be able to sponsor a plan. but the better question is why they even need this plan. if they dont have U.S. Source income why dosn't the embassy just give them the savings contribution as a bonus and let them do what they want with it.

the second employer intends on actually participating going forward. i am concerned about the past two plan years in which they were an adopting employer but did not participate.

the plan in question is non standardized. i believe both plan have a match and benefits are the same. we tested coverage adding the employees of the non participating employer that adopted our plan. however, now we must test the other plan, including the participants in our plan.

the successor plan rule still applies with respect to distributions. thus you would not be able to distribute from the original non safe harbor plan. you would have to merge the two plans.

this is bizarre but i have two entities adopting a prototype. one company just never participated in the plan, instead continuing to participate in its own plan. i know that both plans must be tested together regardless but assuming they each pass, i am thinking i have another issue. that is that one company adopted the plan and did not participate in it. anyone know if i have a problem?

just want to confirm the tax treatment. the distribution is from a DC plan, the participant had not started RMD's and the beneficiary is taking the entire amount. i think you would withhold 20% even though it is going to a guardianship on behalf of the kids. anyone disagree or agree?

jon, sorry to bring up this old thread but i read one of your statements and i dont think it is accurate. i think the opinion clearly states sunamerica would be acting as a fiduciary. i have a question for you or anyone else - lets say a provider (TPA) that is not a RIA wants to offer this service through a third party. do you think they can or do you think the RK (TPA) would have to be eastablish an investment advisorory relationship with the participant as well. this would obviously pose a problem for RK (TPA's) that are not RIA's.

mal and john, i agree with your view. we are not a fund manager. we are an RIA that offers models in the 401(k) service that we provide. thus, if we change the models, i believe it triggers 404© issues. however, i think it would be a prudent decision to do so and might preclude liability in the end.

i wanted to bring this back up to the top since i still need an answer.

from my reasearch it seems the amendment must be done prior to the plan year for which you want to be safe harbor. ie by December 31, 2003 for the 2004 plan year. i think this is what one or two of you said as well.

you can still do it until the regs are finalized.