Kristina

If you have different eligibility requirements for the 401k deferrals than you have for the psp, you could have an active participant who has not yet completed the eligibility requirements to participate in the other money source. For instance, if the eligibility requirements for the 401k deferrals are age 21 and 6 months of service with quarterly entry and you have age 21 and 1000 hours in the eligibility computation period for the profit sharing: an employee who has achieved age 21 and is hired on 1/1/02 will enter the plan on 7/1/02 for deferral purposes and 1/1/03 for profit sharing. For testing purposes, one must just become a participant to be an active participant, so when the participant entered 7/1/02 for deferral purposes, they became an active participant. By the way, if your plan was a Sch I filer for 2000, you would not have to file as a Sch H filer until the employee count on line 6 of the 5500 exceeded 120.

There is an EFAST edit check on the Sch A, but it is only on the last day of the contract year. this would mean you could enter any date in the contract beginning date as long as the ending date does not exceed the plan year end. Leave it to an insurance company to produce such illogical information. I really wish the DOL would hammer them to provide accurate and complete Sch A information

GBurns, I would agree with you about the agent, EXCEPT, that many insurance companies forward the Sch A information to the AGENT and expect the agent to forward it to the Employer.

As I understand it, PS-58 costs are the cost of the insurance at risk. This is determined on the basis of the face amount of the policy, less the cash surrender value. Waiver of premium guarantees that the premium can be paid out of the cash value in order to keep the policy in force. The accidental death benefit just increases the payout amount. While both increase the premium paid, I don't see how they would impact the calculation under the PS-58 rate. If you are using the issuing insurance company's lowest term rate, it might be possible to incorporate the increase in the premium rate to encompass both the waiver and the AD.

Your insurance company is supposed to provide you with information for this question. Again a problem with the insurance companies being required to provide information, but not being penalized if they do not provide it. (We gotta get their lobby.) I always interpreted this to be the amount paid into the contract by the plan and the basis of the premium as whatever the contract contained to determine the amount paid under the annuity. Since the Sch A has the shortest instructions of all the schedules except the Sch P, I don't think the DOL cares. Yet. They are beginning to make changes to the form and are beginning to pay attention to the information the schedule provides. Expect closer scrutiny in the future. One thought. Since the insurance company is supposed to provide the Plan with all of the Sch A information and since we all ask for that information, my suggestion is that when the insurance company is not forthcoming with the information, that an attachment is prepared to the Sch A stating that the insurance company failed to respond to requests for information.

Maybe this will help. The 5500 is filed for the plan, so each member of the controlled group with a plan will file a 5500. Indicating that the plan is a member of a controlled group in Item 8 will explain any discrepancies between Items 6 and 7 and Sch T. (There is no tie between Items 6 and 7 and the Sch T in the EFAST processing.) The Sch T is for the coverage test of the plan which requires that all employees of the controlled group be included in the testing.

I agree with Stephen. Meet Monday's deadline! While the IRS extension seems to be across the board, our friends at the PWBA have attached a string. I would not depend on that extension unless you can prove 9/11 was a factor. The PWBA is in the interesting position of just finishing the processing of the 1999 forms. It seems in late August, they had not started their processing of the 2000 forms. (Yes, all those forms you have already filed are sitting in a warehouse. Generating heat and transferring the glue from those sticky notes onto the forms so processing can be further delayed. Yea, I know, you didn't put sticky notes on them, but are you sure your client didn't?) It would seem that since they have not started looking at them yet, why would they care that you file by 11/15th or not. They are the PWBA, they can do what they want.

I have to put my 2 cents worth in. I worked as an Administrator from 1974 to 2000. (Please note, that is a capital A Administrator, just like Controller. Like a professional who performs tasks that require specific training. Oh, wait, when you are a controller, you learned all that in college and it is not necessary to keep pace with government regulations on a daily basis. So then it would be controller) The idea of an Administrator, in the current legislative environment, being able to handle 180 plans is absurd!!!!!!!! (And, of course, offered by someone who has never done administration! ) For too long this industry has had the notion that you can hire any trained monkey to do administration. Well, look around. Talk to the firms that have had openings for months and have only found a qualified person by the time they needed another person. It has been churn and burn for too long. It is time that TPA firms begin to realize that the Administrators you hire affect your reputation as well as your bottom line. You can treat them like professionals and reap the benefits of their labor, without taking undue advantage, or you can continue in this mode of giving them more work than they can do and have a life away from the office while paying them less than they are truly worth. I realize that most administrators are women, but we are truly not that stupid as to not be aware that your profits and your vacations and your luxury car are paid for by their efforts. Churn and burn is the way you create competition. A TPA that truly values their Administrators will have loyal employees. Treat them like they are "the girl" (who can be replaced with any girl) and they won't be there long. Then your greatest fear of training them and then having them leave will be realized. I did not go into competition with my prior employer. While with them, I handled everything for 116 clients. Everything from putting the stamps on the envelopes to information requests, annual valuations, prospective reviews for new law changes, document amendments, 5500s, 1099s, plan terminations and not to mention the ever popular, I need this proposal in the next 5 minutes. They referred to me as the Pension Division, in fact, I was "the girl" and I was burned out!!!! It is unfortunate, I wanted to stay with them until I retired. Now the idea of meeting a 5500 filing deadline sends chills down my spine and I thank God everyday that I don't have to. Thanks for letting me vent and I hope it helps someone else, Owner or Administrator.

I believe this has been one of the bones of contention between the PBWA and practitioners. However, the PWBA's position is that the financial institution should be able to determine how much of the assets belong to which plan at a given point in time. IF the bank filed the MTIA as a DFE, then you could report the plan's total pro-rata share of the assets on line 1©(11) of Sch H. Otherwise, you must list each plan asset. (Be grateful for spreadsheets.)

Per PWBA, if all disaggregated portions of a plan can qualify under the exceptions listed in 3, then mark the appropriate sections and forget page 2. However, if there were a psp portion to your plan and a contribution was made to only those who were employed on the last day of the plan year or who completed 1,000 hours, then page 2 would have to be completed. By the way, 3b is the accepted check for no er contribution.

Whether the insurance company files as a DFE or not does not affect whether the plan is required to file a Sch D. If the plan invests in an insurance contract in which the assets are held in separate accounts AT the insurance company, then a Sch D is required and the total PSA's must match the total of line 4 of all Sch A's. The only difference between a Sch D prepared when the financial institution does file as a DFE and when they do not, is the PN on each line of the Sch D will be the plan number the financial institution assigned to the plan when they filed as a DFE. When the financial institution does not file as a DFE the PN on each line of the Sch D will be 000. In this case, only the Insurance Company can tell you whether the investments were held in the pooled separate accounts or not.

The 5500 filing is for the plan only so you will be reporting only the plan's portion of the investments.

Factster, Thanks for posting this. I saw it after I posted my comments. Am I the only one who wonders why the DOL, PWBA seem to release their press notices so late on Fridays????????

What's to disagree? They wrote 2001-61 and they have jurisdiction over minimum funding. Let's just hope they see reason.

A master trust is only a master trust for 5500 purposes if the assets are held by a bank. So, if the assets are comingled thru a brokerage house, you do not have a master trust. Also, each plan must file a 5500. Comingled assets and paired plans.

I respectfully disagree with the above cite. I believe the answer is most easily found in reading ERISA section 412(a) which discusses which plan (as opposed to which insurer) is exempt from the bond requirement. Short answer, if the profit sharing plan has assets and those assets are not trusteed by an insurance company or a bank, or if the trustees of the plan are individuals who are not under the supervision or examination by Federal or State authority, it must be bonded. Assuming, of course, that there are common law employees or non-owners employed and participating in the plan.

Per Brian Graff of ASPA, Notice 2001-61 does not address the filing deadline of the 5500 series or the timely deposit for 401k deferrals. If you or your client have not been directly impacted by the tragedy, then do not count on an extension in the filing deadline for the 5500 series so that you will not be late with the 5500 forms you still need to file. Don't count on the DOL being understanding on late deposits of 401k deferrals which occurred before 9/11/01. I would expect the DOL to provide relief for those directly impacted by the tragedy from 9/11/01 thru the date that the financial records can be straightened out (whenever that is).

Per Brian Graff of ASPA, Notice 2001-61 does NOT apply to minimum funding requirements. The DOL has jurisdiction over the 5500 and the timely deposits of 401k deferrals. This is the area that the DOL is expected to post on their website. ASPA is working to see if there is anything that can be done regarding the minimum funding requirements. It would not surprise me for the DOL to apply special facts and circumstances rules for the 5500 and timely deposits which would basically say that you must prove that you or your client was directly impacted by the tragedy before waiving fees.

A pooled separate account is often an account that is invested in a mutual fund. It doesn't have to be, but it often is. An insurance company contract can invest in numerous mutual fund families without the withdrawal issues when participants move their money to another mutual fund. There is no surrender charge to the participant and there is no time lag waiting for the settlement for the participant. The advantage is going directly from Fidelity to Janus, for example, without having to get a check or an electronic transfer. There are additional charges made by the insurance company so that the unit price of a mutual fund held under the insurance contract will not be the same as the published unit price for the same mutual fund held outside an insurance contract.

Oops. Too many casual message boards. Didn't mean to step on toes. The way I read the earlier posts, it read as though they were going to great lengths to identify all contributions separately, which would be disaggregating. Not necessary.

Ahem. The instructions say "the disaggregated part of the plan to which the information on lines 4c and 4d pertains as follows: "nonelective", "401(k)", "401(m)", "ESOP", "Non-ESOP", "Excludable", "Nonexcludable". ... If entering information on life 4e, identify the disaggregated part(s) of the plan as follows: "nonelective", "401(k)", "401(m)", "ESOP", "Non-ESOP", "Excludable", "Nonexcludable"." Why are you considering the QNEC and safe harbor contributions as disaggregated?

I hope you have given those quoting for the audit more information than you have given here. Otherwise, your quotes could be high because they suspect more time will be involved. Better to quote high and bill low than to quote low and bill high.

Due to the unusual circumstances surrounding your situation, I would say to go ahead and file the amended return with an attachment explaining why you are filing before the 2000 form has been processed. As an attachment, your explanation will be scanned into their records so they will have no excuse for trying to collect for imcomplete filings without going thru their process.

OK. Now hang onto your hats. I have seen where the DOL says do not file an amended return until you have received their deficiency letter or until you know the form you filed has been processed. 1) Using this logic, they apparently decided that the only reason you would want to file an amended return is for a deficiency that they would find. Mistakes in the data or misunderstanding in the way a schedule is to be completed has not really entered their minds. 2) The EFAST letter of deficiency in filing is the only way you will know for sure that your forms were processed until the forms are reported to the Office of Public Disclosure. My conversation with the EFAST people netted this as a guideline for the filing of amended returns. a) If the forms you want to amend is the 1999 year, call the Office of Public Disclosure (202/219-8771) to determine if the 1999 forms you filed have been processed. If so, then file your amended 1999 forms. b) If the forms you want to amend is the 2000 year, wait for the earlier of: i) The receipt of the EFAST deficiency letter, or ii) March, 2002 (When the 2000 form processing should be complete. You could just go ahead and file the amended return and it would probably be processed after the original filing. The question is if there is a deficiency letter generated by the original filing and the amended return does not address that deficiency, it sounds as though the DOL then considers your filing to be truly deficient and subject to penalties. I guess they never thought that someone would find their own mistake and want to correct it. Further proof that EFAST means fast for them and has nothing to do with client relations.

Look at it this way. After paying those fees for the B5 "advise", any fees they pay to the IRS will look cheap.