dmb

Question 1: I think the mandatory burn does not eliminate the need to certify. I do beleive that if you don't certify the ATAP is deemed to be less than 60%. Question 2: I don't believe the FSCOB is burned until the AFTAP is certified so if you don't certify you don't burn, however i believe when you sign the SB that becomes the certification and that's when the burn happens as of the beginning of the year.

Not sure if this post should be in the X-testing section, but.....I think it was determined in prior posts that 401(a) plans and 403(b) plans are tested separately for non-discrimination, at least when both are DC plans. We have an employer considering a soft freeze to their DB plan and allowing the new entrants to recieve an employer allocation in their 403(b) plan. Since both plans have uniform benfit/allocation formulas if they both pass the 70% coverage test all is good. But what happens when all is not good with the 70% coverage test in either plan?? If both were 401(a) plans we would move on to rate group and average benefit test where the EBARs would be combined. But in my circumstance with a 401(a) and 403(b) plan, would the EBARs still be combined for average benefits test?? Thanks.

Thanks for the responses. We had decided to go with Effen's approach and provide notice with addtional info that plan is no longer restricted as of 11/1.

Apology accepted. I could have been a little more specific also. Amending the plan to have additional ASDs is not an option. And if we certify by 9/30/11 there would be restrictions as employer has not made decision on getting to 80%. So the question is if the employer makes that decsion after 9/30/11 and before the participant notice must be provided. I appreciate you sticking with this post. Thanks.

Not exactly sure, but generally if lump sum is 50% restricted, participant has option to defer election or bifurcate, but once bifurcated, there's no second bite at the apple. the annuity portion is locked in. What am I missing? Because of the >80% certification, it shouldn't have been bifurcated? Isn't your certification as of 7/1/2011 -- the first day of the Plan Year? Yes, the cert is as of 7/1/11, but its not certified until, lets say 10/20/11. Is that material? Ok, maybe now i'm missing something. At 10/1/11 since there is no certification yet, benefits are restricted, so if there is a 10/1/11 ASD, the benefits will be restricted. then on 10/20/11, the 7/1/2011 AFTAP is certified to at least 80% after employer makes contribution or takes whatever action is necessary to get to 80%. What am i missing??

Not exactly sure, but generally if lump sum is 50% restricted, participant has option to defer election or bifurcate, but once bifurcated, there's no second bite at the apple. the annuity portion is locked in. What am I missing? Because of the >80% certification, it shouldn't have been bifurcated? Isn't your certification as of 7/1/2011 -- the first day of the Plan Year? Yes, the cert is as of 7/1/11, but its not certified until, lets say 10/20/11.

Not exactly sure, but generally if lump sum is 50% restricted, participant has option to defer election or bifurcate, but once bifurcated, there's no second bite at the apple. the annuity portion is locked in.

So if by chance there is/are 10/1/11 ASDs can notice be provided to only those participants??

7/1/10 AFTAP is 85%, no 2011 certification so at 10/1/11 the 2011 presumed AFTAP is 75%, 50% restrictions apply. Prior to October 30, 2011 AFTAP is certified to at least 80%. Must the 436 participant notice still be provided?? Thanks.

Employer has a service based allocation schedule. They are considering allowing collectively bargained employees participate in the plan and add a separate allocation group for them. If those employees are now receiving employer contributions are they still excludable from non-discrimination testing including gateway?? Thanks.

Plan terminated and final distribution of plan assets were 3/31/11. Can a 5558 be filed to extend 5500 due date from 10/31/11 to 1/15/12??? For some reason i'm thinking a plan that has made final distributions could not extend 5500. Thanks.

Please disregard my OP, my misunderstanding.

Does anyone know of a website that publishes the daily rates of the PPA monthly LS segment rates? Thanks.

Got mine late last week.

Thanks for the response. So governmental entities are different than Church entities in this aspect?? It was my understanding that this compensation definition would be subject to testing if this was a church plan. I just want to be sure. Thanks again.

Governmental entity has 401a plan that excludes overtime and bonus from compensation. Is this subject to same non-discrimination testing as non-governmental entity with 401a plan?? Thanks.

I have no experience with 457 plans, but a question came to me. A governmental 457 plan excludes overtime and bonus from compensation. Is this subject to the same discrimination testing as a 401(a) plan?? Thanks.

a participant in a DB plan is actively employed and currently receiving minimum distribution payments as a lump sum. At the time their initial payment was made (3/08) and also when the 1/09 and 1/10 top-offs were paid this plan was at least 80% funded. Now we are about to pay the 1/11 top-off and this plan is currently funded between 60% and 80%. Can the 1/11 top-off be paid since at the time of their BCD (3/08) the plan was not restricted, or do the funding restriction now apply to the portion of the benefit payable attributable to the 2010 accruals? Any help would be appreciated. Thanks.

Thanks Tom. I understand that ebars could differ, but was mostly concerned with the testing, thanks again.

I don't work on many true age-weighted plans, so i'm a little unsure of myself when it comes to testing requirements. I have an age-weighted PS plan with 1000 hour requirement for allocation. I have several participants who terminated with more than 500 hours but less than 1000 hours. I know for those who get an allocation ebars are equivalent due to nature of age weighted plan. Does true age weighted plan need to be tested in the same way as a new comparability plan?? Thanks.

After recieving additional information, the terms are not the same under both formulas so i think my question is answered. Thanks.

I don't think this is a cross testing question, but it is a non-discrimination question. First six months of plan year, the allocation formula was flat dollar amount (all eligible participants receive same dollar amount), sencond six months, the allocaiton formula was amended to a flat % of pay allocation (all participants receive the same % of pay). Does this fall under the safe harbor exemption?? Or does it need to be tested on at the very least and probably the most, a contributions basis?? Thanks.

A non-profit prospect currently has a 401k plan with match and employer base contribution (flat allocation). over 500 participants of which 7 are HCEs. Plan almost always fails ADP, but employer does not want to go Safe Harbor route. Is it possible to amend the 401k plan to exclude HCEs and set up a new 403b plan that excludes all except HCEs?? the new 403b plan would have the same match and base as the 401k plan. Would this solve the ADP failure and be legit from a coverage test standpoint?? All thoughts are greatly appreciated.

Calendar Year Plan has no requirements for a participant to recieve an allocation other than being a participant. No hours requirement, no last day rule. Is it too late to add last day requirement for 2011?? If not, how would this be administrered?? Thanks.

Does adoption date of new plan come into play with regard to the first year AFTAP. E.g., New Calendar Year Plan adopted 11/1/10. 2010 AFTAP normally would be required to be certified by 10/1/10. what are due dates of certifying 2010 AFTAP in this scenario?? Thanks.