RCK

It seems to me that jms370 has three alternatives: 1. Respond that as a former participant, they are no longer entitled to receive those documents. On advice of counsel, this is what we did last time we got a request like this. 2. Tell them they are not entitled to either document, but that you are sending just an SPD because you are such a nice person. 3. Send them an SPD, and tell them that if they want a copy of the plan document then they will have to pay the copying charge in advance. If your SAR then says that the copying fee is $0.25 per page, and your plan document is 150 pages, then they will probably go away. RCK

I disagree with JanetM's interpretation. I think that loan default rules vary by plan, but if the plan says default occurs at the end of the quarter following the quarter of last payment, the default date would be probably be March 31, 2001. I suppose that you could argue that if the first payment was not due until 2001, then the deafult date is June 30, 2001. But I don't think that you can say that the default does not occur until the end of the quarter following whichever quarter the only payment occurs in. RCK

Treasury Reg 1.401(a)-20, Q&A 3. RCK

Upon further consideration, I'd like to clarify my statement. I believe that from a legal perspective, the spousal consent only applies during the period before the participant elects a form of benefit. So for a subsequent change, no consent would be required. But from a plan sponsor perspective, I would require spousal consent. That is, I don't want to end up in court over this one if I allow the participant to name a non-spousal beneficiary while he has a spouse. So the adminstrative committees of our plans would require spousal consent for this change. RCK

There appear to be several different questions here: 1. Can the participant change the form of benefit? I've never seen a plan that would allow a change after benefits commenced. 2. Does the participant need the consent of the new spouse for the designation that he created when he was not married? No--I agree with pax. 3. If he changes beneficiaries now, does he need spousal consent? I would say yes, but am not going to be able to provide a cite for that. RCK

I don't think that you are missing anything. They have to be aggregated for Top Heavy, as well as participation and coverage. RCK

Separate issue: If this were my client, I'd be sure to go back and make sure that their handling of the plans were correct for all the coverage, and participation rules. I'd be willing to bet that the 5500 filings were not done on a controlled group basis. That is, they were undoubtedly part of a controlled group, and each answered the questions of 5500 question 21 (old format) on the basis of their own population. RCK

I'm thinking of changing my ID to "What does the plan document say?" Ours say that we can delay payment to a participant if and only if we have in hand a draft QDRO signed by a court. This language has come in handy in several situations in explanatins to attorneys of angry alternate payees. RCK

I agree with the other posts-- you have to do 401(m) testing. In fact, most plans that I've been involved with have eliminated post-tax contributions or limited them to non-HCE's, just because it is so difficult to pass the test without restrictions.

I believe that pax is right and that what he is trying to say is that the plan has to 100% vest those who terminate, but only if their termination is connected with the partial plan termination. So if someone terminated in January of 2001, before your plant closing of December of 2001 was even a thought, they do NOT have to be 100% vested. Similarly, someone who terminates from your California plant when your New England plant is closed does not have to be 100% vested becasue they are not an affected participant. On the rehire issue, I don't have a cite, but feel that someone who is 100% vested as a result of a partial termination would not revert to the vesting schedule upon rehire. RCK

For the record, the Special Tax Notice says that 10 year averaging is available to anyone who takes a lump sum distribution and was born before January1, 1936. So mbozek is correct on that point.

The only ways out of the penalty in your situation would be to repay the loan before taking the distribution, or to roll the entire distribution, including restoring the loan amount. In other words, you can repay the loan to the plan you are leaving, or the plan that you are entering. RCK

lforesz, I don't have a code or regs reference for you, but I'd rely on the "what does the plan say" position. Our main plan says essentially that to the extent that there distributions due to 402(g), 415, or 401(k)/(m), then the applicable matching contributions shall be treated as forfeirtures and reallocated. RCK

Oops -- you're right. If the merger date is actually 7/1/01, the filing deadline is 2/28/02. And if the merger date had been 6/30/2001 the filing date would be 1/31/2002. RCK

Just to emphasize what you already know, the 5500 for the smaller plan was due 1/31/3002 (7 months after the merger date). RCK

pax is of course right. I can read but I can't type . . . . RCK

The glib answer would be that it is just common sense--if there's no spouse, you don't need spousal consent. But since common sense does not always prevail in this arena, I'd suggest Reg 1.401(1)-20 Q&A -27, which says that if it is proved to the satisfaction of a plan representative that there is no spouse, then spousal consent is not required. RCK

No, there isn't a spouse to consent. Unless of course they have remarried.

Let me clarify. We are on Amendment 25 of our plan, but we do use the working copy format. That is, the working copy does have all the amendments carried into the text of the body of the document. So I guess that it is almost a restatement every time. RCK

I don't believe that there is a concrete limit--our Defined Benefit plan has just gotten a 25th amendment. I think that you restate when you are sick of trying to keep track of the amendments. RCK

My employer is a Fortune 100 company, with a bunch of locations and plans. In general, we do not require proof of either marriage or dependent children, mostly because we agree with mroberts' comments. However, lying about dependents is a breach of our Code of Conduct, and grounds for discliplinary action up to and including termination of employment. How would we find out? The only case I know of is one where the employee was bragging about outsmarting the company, and the story worked it's way back to the local HR administrator. RCK

Is the plan's representative saying that a spousal waiver is necessary? In some cases, the participant can take the distribution as a lump sum without spousal consent. I would double check that before proceeding any further. Otherwise, I agree with pax. RCK

It seems to me that the question changed somewhere along the line. The original question was for a two person plan--husband and wife. But LTURNER's last resonse makes me think that the husband and wife are the last two in the plan, but that it was bigger and covered others sometime in the past. If that is the case, the argument in favor of waiting for a letter gets stronger, because there would more possibility that the IRS will require some kind of change. If they, for example, required a change in an allocation of forfeitures, then there would be a possibility that the rollovers would have to be unwound. To me, if you're going to file for a letter, it does not make sense to make distributions before you get that letter. RCK

I just put a 5310-A filing in the mail this morning for a plan merger, so this is a hot topic for me. That filing has to be filed at least 30 days prior to the transaction date unless you meet one of the exceptions, and the only one that could be applicable here would be if one of the plans was de minimus compared to the other. That is, the total liabilities of the smaller one have to be less than 3% of the assets of the larger one. So doesn't that push your merger date out until at least February 10?

Who actually drafted the original document? If it's not a prototype, I would expect a law firm to be involved. If so, they should absolutely have a copy. If not, the sponsor has to look a little harder. Getting help from the IRS? I don't know anyone who has done that. If that all falls through, and you have a good sense of what all the plan provisions are, then I would definitely go with the amendment/restatement route as suggested by Larry M. I don't think that you are going to be able to get a determination letter without being able to track back to the original document, but that might be the least of your problems right now. RCK