TPApril

Andy, interesting discussion you linked to which brings up a lot of other issues related to fee reimbursement. ESOP Guy - I thought by your name you would suggest the reimbursed fees be treated as employer contributions. If I recall correctly, in an ESOP, when an employer reimburses an ESOP for the value of a distribution that is paid out, that amount is treated as a contribution. I know it's different but it does make me wonder, any time an employer does put money into a plan for one reason or another if it should be treated as a contribution.

I thought I'd repost my questions. Not sure yet how to treat amounts deposited to the trust by the plan sponsor to reimburse the plan for fees withdrawn from the trust, either for administrative or other expenses?

response questions well posed - DC plan with some fees reimbursed by investment company and some reimbursed by plan sponsor. Are you saying that when reimbursed by the plan sponsor they are counted as Employer contributions? if so, do they need to be included in the 415 test or just the max deductibility test?

simple question- when prepping Schedule H or I, are amounts that are reimbursements for fees treated as Other Income or subtracted from the Administrative Expenses

Similar situation in that plan document preparer submitted restated 401(k) plan with a typo in a provision related to eligibility to defer. Plan continued to operate under prior provisions, SPD reflected prior provisions, and document preparer has now amended the plan to correct for the typo. It seems to have been an isolated case by document preparers, but could cost plan sponsor significantly to submit VCP. Would maintaining all records with history of adhering to prior provision enough as SCP?

Now that it is many years later, dividends from mutual funds are no longer included in line 2b(10), but separated out and reported on its own line entry under 2b(2). My question then is where do capital gains distributions from mutual funds fit in - with dividends on 2b(2) or realized gains on 2b(10)? Same question for interest/dividends that come from Money Market Funds?

different but related scenario, similar concept - trying to determine if there is a fiduciary or simply ministerial role here: client faxes tpa a copy of the biweekly payroll indicating 401k and match deposit amounts. tpa logs onto tpa accessible website of investment company, enters contribution amounts by participant, and then enters total deposit amount to request transfer of dollar amount, as preauthorized by client from client bank account. Is there any concern that that last step may be treated as handling money or going beyond ministerial role?

Thanks for your response. I would make a correction to my first post - regarding defaulted Loan 1 - interest, as calculated from date of last payment to date of default, was indeed included in the 1099 in 2005. So I think no interest on that loan is taxable at this point (since interest calc'ed later is only used for future loan availability calcs).

Participant has terminated and has two outstanding loans – the first one defaulted in 2005 and was a deemed distribution with 1099 issued; second one is active loan until termination. Participant is taking cashout, so I’m trying to calculate both withholding amount and distributable amount after loan offset of second. This is my calculation, any helpful thoughts? General Account Balance (excluding loans) $50,000 Loan 1 - Defaulted with 1099 in 2005 $20,000 Loan 2 - Active Loan Current Principal $15,000 Interest on loan 1 accrued through default date (never paid or reported) $500 Interest on loan 2 accrued from last pmt to distribution date (never actually pd) $100 Subtract Loan 1 with phantom interest - already deemed $(20,500) Total - Taxable Amount $65,100 Less 20% $(13,020) Offset - Subtract Loan 2 with interest $(15,100) Net Cashout Amount $36,980

I'm curious to know how this turned out?

Does anyone know off hand if Wells Fargo Advisors, formerly Wachovia, but now owned by Wells Fargo, can certify investments to allow for a limited scope audit, or someone I can contact there who can actually answer that question for me?

Well I feel naive posting this question, but I had thought that the final regs for 408(b)(2) had been published and we are now working towards putting them into effect by 1/1/12. I was recently told by attorneys that the final regs are not out yet. I did a quick search and found the Federal Register publication dated 7/16/10 entitled 'Interim Final Rule'. I was thinking a best practice would be to get started with these rules. As an industry are we on hold waiting for additional rules prior to 1/1/12 and we should wait before revising our contracts?

Have you figured out what you are planning to do, or have you done it already?

We are in the process of putting together software/subscription requirements for a new TPA practice. Coming from a large firm, we had an inhouse daily research on current topics. Not having access to that anymore, We have found a variety of free daily or weekly newsletters such as 401khelpcenter, freeersia, benefitslink, etc. CCH has a free subscription and a pay subscription. What is the general consensus on sufficient digest/updates to provide necessary goings on for a tpa practice? are the free resources sufficient?