Harwood

Start with the terms of the Plan document

Re: Section 6.02(5)(b) of Rev. Proc. 2003-44 Is that perhaps talking about forgoing distributing small amounts only if the undistributed amount stays in the plan in the Participant's account? I don't think it allows a plan to reabsorb amounts of lees than $50.

ERISA §101 Duty of disclosure and reporting. (a) Summary plan description and information to be furnished to participants and beneficiaries. The administrator of each employee benefit plan shall cause to be furnished in accordance with section 104(b) [29 USC §1024(b) ] to each participant covered under the plan and to each beneficiary who is receiving benefits under the plan

You should get a copy of any plan documents, as well as details about the "ERISA ruling."

Benefitslink has links to some sections of the Internal Revenue Code. http://benefitsattorney.com/cgibin/framed/...?ID=304&id==304

Mutual funds [interests in "a regulated investment company"] fall under the 731©(2) exclusion. Therefore, the 5500 Preparer's Manual says that for Schedule R, line 1, you ignore "stocks, mutual funds, etc." Two notes: 1. In 1999: "Line 1. Enter the total value of all distributions made during the year (regardless of when the distribution began) in any form other than cash, annuity contracts issued by an insurance company, or publicly traded employer securities." Starting in 2000: "Line 1. Enter the total value of all distributions made during the year (regardless of when the distribution began) in any form other than cash, annuity contracts issued by an insurance company, distribution of life insurance contracts, marketable securities, within the meaning of Code section 731©(2), or plan loan offset amounts." 2. Why do the instructions have 731©(2) instead of 731©(2)?

Since a SAS 70 is a report on the processing of transactions by service organizations, I see no reason why it would be limited to daily valuation providers.

There is no way these people are eligible for a distribution. Among other things, see: http://benefitslink.com/modperl/qa.cgi?db=...ibutions&id=190

In the September 15, 1996 issue of Employee Benefit News," "Attorneys cited their favorite [employer screw ups]." The first bullet point was: "Denying coverage to part-timers as a class. While restrictions can be put on receiving benefits based on very specific criteria (for example, working fewer than a stipulated number of hours), the blanket statement that 'part-timers aren't covered' is not an adequate definition, says Bill Gerek, a Chicago-based ERISA attorney."

I think it makes perfect sense for plans to have a QDRO procedure that is in sync with the California law: if a plan receive written notice that a QDRO will be sought, a hold is put on making distributions to the Participant.

I like California Code Section 755(b) on written notice: ". . . if payment or refund is made to a participant or the participant's, employee's, or former employee's beneficiary or estate pursuant to an employee benefit plan including a plan governed by the Employee Retirement Income Security Act of 1974 (P.L. 93-406), as amended, the payment or refund fully discharges the plan sponsor and the administrator, trustee, or insurance company making the payment or refund from all adverse claims thereto unless, before the payment or refund is made, the plan sponsor or the administrator of the plan has received written notice by or on behalf of some other person that the other person claims to be entitled to the payment or refund or some part thereof."

"The person who signs this form may be an employer, plan sponsor, or plan administrator filing a Form 5500, 5500-EZ, or 5330, a disqualified person filing Form 5330, an attorney or certified public accountant qualified to practice before the IRS, a person enrolled to practice before the IRS, or a person holding a power of attorney."

IRC § 72 (p) Loans treated as distributions. (4) Qualified employer plan, etc. For purposes of this subsection — (A) Qualified employer plan.— (i) In general. The term 'qualified employer plan' means— (I) a plan described in section 401(a) which includes a trust exempt from tax under section 501(a) , (II) an annuity plan described in section 403(a) , and (III) a plan under which amounts are contributed by an individual's employer for an annuity contract described in section 403(b) . (ii) Special rule. The term "qualified employer plan" shall include any plan which was (or was determined to be) a qualified employer plan or a government plan. (B) Government plan. The term 'government plan' means any plan, whether or not qualified, established and maintained for its employees by the United States, by a State or political subdivision thereof, or by an agency or instrumentality of any of the foregoing.

The document is correct. An alternate payee can have an immediate distribution - an active participant cannot.

1. The per diem is for meals and "incidentals" only. Mileage is a totally separate issue for business related expenses. It seems like the "per diem" being provided in this situation falls far short of being adequate reimbursement. The DOL is being overly harsh to try to reduce it further. 2. Per diems for meals are an approved alternative to submitting actual meal expenses. People who want to feed themselves for less than $42 per day while on business in Chicago [not to mention incidental expenses of dry cleaning and hotel tips] are free to keep the difference. It is my experience that out-of-towners will almost always spend more than the IRS approved per diem amount.

Boston, Chicago, and Philadelphia are "high-rate" cities for per-diem purposes. $42 for meals and incidentals from 10/1/01 - 9/30/02. See IRS Publications 1542 and 463 If a meal is provided to a government employee, the employee must reduce their per-diem by $9 for breakfast; $9 for lunch; $22 for diner [$2 is for incidentals such as laundry]. www.policyworks.gov/ftr Chapter 301, 301-11.18 For spouses, I think there has to be a clear business purpose, otherwise their expenses are not considered business-related. Perhaps the hosts of the dinners who invited everyone can help you out with this issue.

The QDRO was valid, yes? As long as there wasn't a "sham" divorce, why would they want to cause everyone headaches - not to mention legal fees - and undo a legal action? Leave things the way they are, with the separate account.

Such Code D reporting is optional but highly recommended to avoid future correspondence and headaches.

1.401(k)-1(d)(2)(iv)(A)(1): "Expenses for medical care described in section 213(d) previously incurred by the employee, the employee's spouse, or any dependents of the employee (as defined in section 152) or necessary for these persons to obtain medical care described in section 213(d);"

Edited excerpt from Q&A 26, 2002 ABA Joint Committee on Employee Benefits & IRS Officials. http://www.abanet.org/jceb/2002/qa02irs.pdf Q: An employer maintains a qualified cash or deferred arrangement on a calendar-year basis and stops all further contributions once a participant's compensation exceeds the §401(a)(17) compensation limit. . . . IRS response: . . . The IRS noted that such a limit on deferrals would be considered an employer-provided limit, since neither §401(a)(17) nor the regulations thereunder would require suspending elective deferrals solely because the participant has received wages equaling or exceeding $200,000.

As you point out, the SSA has confidential information about other participants. Schedule SSA is NOT open to public inspection. I would not provide it. DOL Reg 2520.104b-10 mentions the full report, but then it lists 10 items that could be in the report. No mention of SSA. "You have the right to receive a copy of the full annual report, or any part thereof, on request. The items listed below are included in that report: [Note—list only those items which are actually included in the latest annual report.] 1. an accountant's report; 2. financial information and information on payments to service providers; 3. assets held for investment; 4. fiduciary information, including non-exempt transactions between the plan and parties-in-interest (that is, persons who have certain relationships with the plan); 5. loans or other obligations in default or classified as uncollectible; 6. leases in default or classified as uncollectible; 7. transactions in excess of 5 percent of the plan assets; 8. insurance information including sales commissions paid by insurance carriers; 9. information regarding any common or collective trusts, pooled separate accounts; master trusts or 103-12 investment entities in which the plan participates, and 10. actuarial information regarding the funding of the plan."

A short piece: http://www.reish.com/practice_areas/Techni...ips/IRStip1.cfm A longer piece: http://www.jenkens.com/jenkens/newsletters...IB/bib_v3i2.pdf [Article on page 3]

Please see http://www.benefitslink.com/boards/index.php?showtopic=20450 By law, one must be an employee to have a 401(k) deferral. All W-2 wages may count towards plan compensation, but deferrals cannot legally be taken for those W-2 wages paid post-employment.

Wouldn't we be talking about the normal recordkeeping requirements for business expenses, as outlined in IRS Publication 463 ""Travel, Entertainment, Gift, and Car Expenses"? http://www.irs.ustreas.gov/pub/irs-pdf/p463.pdf

Regarding 401(k) deferrals: legally, it is OK to deduct from vacation and severance pay if paid on the last of employment [i.e. while still an employee]. Deferrals should not be taken from payments made post-employment. Some companies, though, have policies where they don't take deferrals from final paychecks. As always, it is important to have a written policy [hopefully publicized], administered in a non-discriminatory manner.