Gary

a company (company A) has tax year from 11/1 to 10/31. On 11/1/12 they create shor tax year from 11/1/12 - 12/31/12 and then in 2013 they have calendar year tax year. they adopt DB plan 12/15/12 effective 1/1/12 with calendar year plan year. So 2012 minimum funding is for a 12 month plan year but only applies to short two month tax year. min/max funding is 100k for first year. can 100k be deducted for 2012 tax year? In addition company B is in same controlled group as company A and also adopts plan and has a full calendar year tax year. Could Company B contribute the 100k for company A and deduct full contribution as an alternative to company A making a contribution? And last say they jointly adopt a PS plan. Say max contribution for full plan year for company A is also 100k. For short tax year it would only be 1/6th that amount. Could company B instead make contribution based on entire plan year comp for company A?

right, the doc does not provide suspension of notice and only provides act increase.

nrd is age 62 and one man plan. plan does provide for actuarial increases for late ret. tpa wanted to assume ret age 65 with no increase in frozen AB. my position is simply that you act increase AB to 65 per plan. my inquiry here was if anyone had a view or experience of deferring ret to age 65 and not increasing benefit payable actuarially. i was trying to see if tpa opinion could be supported in any way. i dont believe benefits can be forfeited accept upon plan termination distribution.

thanks for the info. it isn't a one participant plan. small, but not one participant

just to clarify. the participant is age 59 and proposed val by tpa firm has assumed ret age of 65 instead of nra 62. of course i dont see that changing the methods, but just want to be sure to be clear. thanks

a plan sponsor made deposit on 9/17. tpa wants to show cont date of 9/17 on sb. i say it is wrong and they just have to show deficiency on sb. unfortunate, but the way it is. any other views, experiences?

a frozen plan has NRA of 62 and is a one participant plan. participant not near 415 limit. plan provides that for late ret benefit is actuarially increased. a tpa firm ran a val with retirement deferred to age 65 but did not actuarially increase benefit payable at 65. my position is that the benefit s/b act increased per plan terms. any one see justification in not actuarially increasing benefit at late ret for val purposes? thanks

an employer has 2 401k plans. one plan is deferrals only the other plan includes the key employees, is TH and provides 3% non elective safe harbor both plans pass discrimination on their own. so no TH in deferral only plan. they are thinking of adding a DB plan and testing it with 401k safe harbor plan. they need to include a couple of people from deferral only 401k plan in DB plan to pass minimum participation. So questions is: any problem with a participant in the 401k deferral only plan also participating in safe harbor 401k plan? the person would be subject to the deferral limit of 17k in total of course and perhaps make deferrals in one plan and receive employer allocations only in other plan. so, such a person would be in both 401k plans and the db plan, but the safe harbor 401k plan and DB plans combined do not need 401k deferral plan to pass non discrimination. thanks

all great points. the plan is top heavy but she didnt work to last day. lets assume no safe harbor. so the question boils down to: can DC plan provide the gateway (with no amendment) if the participant does not meet any of the criteria for an allocation. Meaning, no safe harbor, no profit sharing, no top heavy, but yet gateway required? i presume plan can be amended before end of 2012 and provide allocation for this one termnated employee? yes, i realize gateway can be offset by DB equivalent allocation.

An employee termianted in 2012 with over 1000 hours in 2012 the company sponsors a DB plan and a 401k plan and combines for testing. the employee will earn an accrual in DB plan for 2012 since over 1000 hours 401k/PS plan requires 1000 hours and last day employment so employee is not entitled to an allocation in PS plan for 2012. The combined plan s cross tested and requires gateway of 7.5%. It is cleaner to meet gateway in PS plan. Since employee is benefiting in the combined plan format can PS plan simply contribute gateway in PS plan? Or does PS plan need an amendment prior to 12/31/12 providing for an allocation to this terminated EE? Now how would above situation change if it were a non elective safe harbor 401k plan? does this allow for the gateway in PS plan? It seems whether it is a DB accrual or 401k safe harbor the employee is benefiting, but perhaps where employee benefits dictates where gateway can be provided.

true. thought of that. dont thik client wanted that. thanks

a company has a SIMPLE IRA plan in 2012. my understanding is that if company wants to implement a qual plan they will have to terminate simple plan in 2012 and establish qual plan in 2013? is my understanding accurate? thanks

the plan meets ratio coverage already, so giving allocations to these employees is just to pass a4. these employees are already participants, they just didnt have enough hours for 2011. perhaps this changes things a bit. i will look into situation further too. thanks

A profit sharing 401k plan requires 1000 hours and last day for an allocation in order pass a4 they want to give an allocation to an employee with less than 1000 hours and to another employee with less than 500 hours. i recommended to 401k consultant to prepare an 11g corrective amendment. consultant says that plan provides fail safe provision only if employee has at least 500 hours. i looked at plan fail safe provision and saw a section that does not require 500 hours. Questions. 1. the description of fail-safe allocation only references 410b. so does this mean that it doesnt even apply for an a4 allocation? 2. if it does apply then would consultant's comment be correct? 3. and if it does apply, does fact that there is a section that apparently does not require 500 hours enable such a corrective amendment to employee w less than 500 hours? thanks much

one of the incidental death benefit limits is the life insurance (based on maximum premium calculation) less cash value plus auxilliary fund. i believe it is in 74-307. so if pvab is greater than auxilliary fund than it would presumably make total greater than incidental death ben

i'm thinking it may fail because the pvab might be greater than the ILP auxilliary fund.

additionally, a plan defines death ben as life proceeds less CSV plus pvab. hmmm. the above does not seem to meet incidental death ben for sure; i.e. if pvab is greater than what the "auxilliary fund" would compute to be, it seems in excess of incidental death ben. thoughts?

Say the face amount of a life policy is 100k and the CSV is 20k At death say 100k goes to plan and trustee pays 80k to beneficiary and 20k CSV remains in plan. does this mean that PS 58 costs do not apply since plan retains some of the proceeds? per 1.72-16(b)(6)? thanks

first year working on this plan The plan sponsor contributed an excess contribution for 2010 as of 100k as of 12/31/10 val date. no credit bal or pre fund bal prior to 2010 no election is made by 9/15/11 to establish a pre fund balance. as a result it seems to me that it is too late to establish a pre fund bal for excess 2010 contribution and thus no available pre fund bal to offset 2011 min funding. Am I missing something? it pays to plan ahead or just establish a pre fund bal all the time. thanks

all good points. we have been considering them thanks

yes he will want to terminate his one man plan. at age 62 his combined benefits were at 415 limit, but the plan did not get terminated. so now at age 65 his AB in one man plan did not increase, but his age 65 guild benefit is worth more than his age 62 guild benefit, thus on a combined basis one of the ABs needs to be limited. And of course the lump sum value is less since he has gotten older. perfect storm. it would be easy if he just receives total ben from one man plan and then informs guild so they can limit future payout from guild plan. though not sure if such a liberty (in light of the 4th of july) is permissible. thanks

all good points. it is a document matter. the precedent set by prior adminstrator/actuary limited proj ben by 415 then pro rated. not to say that was correct per se. thanks

plan sponsor approaches me with a plan in which he has not filed 5500s since 2000 and has not done valuations. plan has close to 400k. he would like to terminate and rollover into IRA (of course). he is approaching age 70. my impression is to file anonymous VCP suggestinig that all prior years' vals and 5500s to be created. any better suggestions? thanks

i picked up a plan and the formula is 100% AMC pro rata participation. only owner in plan, though not a safe harbor formula owner AMC is 20,000 per month owner has 5 years participation and will have 15 at NRA valuation computed AB as 16,250 * 5/15 = 5,417. well i dont have a problem with the above and pre PPA with a funding mehtod using projected benefit I would think the above projected ben of 16,250 (415 limit) is required. Now post PPA we live in the world of the AB. It seems acceptable for AB to be = 20,000 * (5/15) = 6,667, as 415 limit after 5 years participation is 8,125, so no problem. Opinions re: the pro rata of 20,000? plan provides that AB is the ret ben participant would receive at normal ret multiplied by participation/part at NRA. thanks

a one participant db plan participant has benefits under guild plan. i havent worked with coordinating guild benefit plans. is it permissible to have his corporate db plan pay out his benefit and then notify guild plan of the benefits distributed so they can coordinate their dsitribution limits? is there any concrete regs, code, grey book info on t his? thanks