JanetM

You would have to reissue W-2.

You can't combine them into one plan. You could move to single TPA in effort to reduce cost. Is that what you mean?

Since A recognizes service with X then she would be in immediately.

Since this person has not had distributable event, you can't change the amounts to rollover. If you allow tranfer to the other plan the sources should stay intact.

Well it is a retirement plan after all. I don't know of any guidance but do have experience with plan not getting a determination letter on profit sharing plan when it stated in service w/d age was 45. Just so happened the owner was about that, and all the employees where 20 somethings.

You lost me, what is a MERP?

Issue cash basis statements ............. if account is participant directed chances are they can go online and see the same thing.

You can have HS form more than salary deferrals. But there are hoops to jump though first. Plan doc has to define hardship for starters. Old rev ruling - oh found it - 71-224

I would use private locator. We have subscription to LexusNexus. But we have found the old missing participants don't always get found. They end up living with family or in nursing home and we locate them when they turn up on SS death index.

Cost - benefit- risk is all you have to look at. You don't mention the type of plan - DB or DC. If the plan is small or large. If the plan has a current determination letter. IMHO if you have a plan that has a current determination letter, you are sure it has been run in compliance with the document, I would terminate and distribute as soon as possible. Keep in mind, all the letter does is assure you the document is qualified. You have to actually operate the plan as written for the qualification to actually apply to the plan.

CG would be parent and new companies after transition time passes. My take on this since you didn't give anthing on the parent. A bought 1/3/05, PYE 1/31/05, plan under transition rule until 1/31/06. Plan tested with parent effective 2/01/06. B bougth 8/9/05. PYE is 6/30/06, under transition rules until 6/30/07. Then tested with parent and A. Transition rule applies to plan year ending after date of acquisition and one additional year. Learned that one the hard way, bought a two companies with 3 K plans and 4 DB plans on 12/29/99. 2000 was a very busy year getting out ducks in a row.

That would be trying to take money that you have paid taxes on and moving to account that is funded with pretax money. That doesn't make any sense.

We are plan sponsor/employer. Promissory notes for all four K plans list, loan amout, interest rate, total interest and total P&I, # payments, pay off date. and pay frequency. Note has one sentence to say if any of this information changes the loan could be reamortized. Nothing to it. Nothing unilateral about it. What would your employer do if this happened - cause this happened today in my office. Person was out on medical leave and suspended loan payments. Now they are back and must make 14 months of payments in 8 months to avoid exceeding the 5 year limit. We simply reamortized the loan. If they change from monthly to biweekly - there will be 26 payments made on loan instead of 24. The acceleration of the payments will decrease the total interest paid over life of loan. The truth in lending disclosure you have in promissory note is now not TRUTH. If this plan requires an audit - this won't fly by an auditor. Could be couple things - flash back to my days as a TPA - the employer might just not want to pay you to do all that work and is trying to justify not spending the money. You won't find a site saying if you make changes you must reamortize ..................

Am thinking this benefits HCEs and not rank and file. I think it would also cause you to fail the ACP. Too late in the day to look for a site, am working on my escape tunnel.

Why not just reamortize the loans for new payroll schedule? Someone just starting to repay a 4 or 5 year loan will actually overpay if you stick to original schedule since they will be paying 2 extra payments each year. The interest will be lower if you reamortize - folks will see small decrease in payment - that should make the employer happy.

Belgarath, that is why the folks my office, we are plan sponsor - check on all those folks with year end term dates to ensure what gets into record keeping system is correct. We do change dates if the situation warrants it.

I don't have a cite. There was a thread but I can't find it. What I do have it Q&A from coverage & nondisrimination answer book. TREATISE, COVERAGE-NONDISCRIMINATION-ANSWER-BOOK, Q 6:38.1 A plan has a last day provision. An employee quits on December 30. December 31 is a Saturday and the office is closed. Should this employee receive a contribution and therefore be considered benefiting? A plan has a last day provision. An employee quits on December 30. December 31 is a Saturday and the office is closed. Should this employee receive a contribution and therefore be considered benefiting? What is really being asked here is "What does it mean for an employee to be employed on the last day of a plan year?" Consider the following examples: 1. 7/31/2005 falls on a Sunday. If an employee's last day of work was on 7/29/2005 and the plan sponsor is closed on Saturday & Sunday, would the employee be considered to be employed on the last day of the plan year ending 7/31/2005? 2. Employee terminates employment on 2/23/2005 and is paid two weeks unused vacation pay on his last day of work. Would this employee be considered to be employed on the last day of the plan year ending 2/28/2005? 3. Following a hectic tax season, a CPA firm closes from April 16th through May 5th. An employee works on 4/15 but does not return to work when the company re-opens in May. Would this employee be considered to be employed on the last day of the plan year ending 4/30/2005? 4. 12/31/2004 was New Year's Eve and many businesses were closed that day since January 1st was a Saturday. If an employee's last day of work was on 12/30/2004, would the employee be considered to be employed on the last day of the plan year ending 12/31/2004? These questions were answered by an IRS representative in the following manner at the fall 2005 ASPPA Conference: "Being 'employed' on the last day of the year is not the same as working on the last day of the year. Employment is a 'relationship' with the employer. If you are on vacation and someone asks you where you work, if you are still 'employed,' you have an answer, even though you are not actually working during the vacation period. "So, if 12/31 is a Sunday and it is a business that is only open Monday to Friday, unless someone has been terminated from employment as of that day, they are still employed even though it is not a work day. "So, your example 1: as long as the person wasn't terminated, he is still employed on 7/31 even though it's a Sunday and not a work day. Example 2 Employee is terminated prior to the last day; he is not employed on the last day regardless of how much money he is being paid upon termination. He is no longer employed by the firm as of 2/23. Example 3 The question is always 'is he employed' during that period, not 'is he working.' (BTW, seasonal employee rules were never issued, so let's not deal with 'seasonal employees' here --besides, I don't think a three week shut down qualifies as 'seasonal'). Let's just assume that everyone is on vacation. Are they fired (terminated) on 4/16? Unlikely. They are basically on a company wide vacation; they are still employees; they are supposed to come back on 5/5. Therefore, they are still employed as of 4/30. Example 4 Basically the same as opening comment about 12/31. Here, the company is closed 12/31 and last day of work was 12/30. None of that matters; what matters is 'was he still employed on 12/31,' and the answer is yes (unless he was actually terminated on 12/30)." (IRS Q and A #32, Fall 2005 ASPPA Annual Conference) As with any comments by IRS officials, such comments carry the following caveat: The answers reflected in this presentation are the ASPPA representatives' interpretation of the IRS officials' responses, and not direct quotes. They are intended to reflect as accurately as possible the statements made by the government representatives. This material does not represent the official position of the Internal Revenue Service, the Treasury Department, or any other government agency; nor has it been reviewed or approved by the Service or Treasury.

12/29/06 was the last normal work day for an employee with standard monday to friday week. If this is 24/7 type of operation - the test would be if this was the last day of the week based on the employee's normal work schedule. If this is the case the employee is employed on the last day of the year and does get the ps contribution.

Hmmm. If the person given the mortgage in not a party in interest you have crossed one hurdle to being allowable. Now you have to ask is this a prudent investment of plan assets. Using simple interest, the rate being charged is only 6%. Lower than mortgage rates via other sources. I would argue this isn't a prudent investment of plan assets.

Loan are not permitted in IRA accounts. If loan balance existed at time of rollover then it would be treated as distribution immediately by IRA. Besides a loan isn't a distribution eligible for rollover. Some brokers will say anything, had one recently telling one of my union groups that everyone has the option of taking their pension in lump sum.

Our IT department has given up on the new Microsoft Vista. They have struggled for a week trying to get it to run with Oracle. Oracle and java script seem to be the issue. Per Microsoft it is an Oracle problem, per Oracle it is a problem with the operating system. Can you say stalemate.

Pretty sure it was Unemployement Compensation Amendments of 1992.

The Taxpayer Advocate Service: Call (801) 799-6958 in Salt Lake City

For DC plans we are simply listing the investment options, fees and expenses. Adding bit about diversification. The notice we send terminated folks explains all distribution options as well as their right to leave money in plan. Adding they are still responisible for managing the account. Until model language comes out we are trying to comply.

How have rehires been handled in the past. Has a precedent been set? Now is the most opportune moment to amend the plan to clear up this issue. Like WDIK said - 410(a)(5) is where you need to start. Will cut and paste for you 410(a)(5) BREAKS IN SERVICE. -- 410(a)(5)(A) GENERAL RULE. --Except as otherwise provided in subparagraphs (B), ©, and (D), all years of service with the employer or employers maintaining the plan shall be taken into account in computing the period of service for purposes of paragraph (1). 410(a)(5)(B) EMPLOYEES UNDER 2-YEAR 100 PERCENT VESTING. --In the case of any employee who has any 1-year break in service (as defined in section 411(a)(6)(A)) under a plan to which the service requirements of clause (i) of paragraph (1)(B) apply, if such employee has not satisfied such requirements, service before such break shall not be required to be taken into account. 410(a)(5)© 1-YEAR BREAK IN SERVICE. --In computing an employee's period of service for purposes of paragraph (1) in the case of any participant who has any 1-year break in service (as defined in section 411(a)(6)(A)), service before such break shall not be required to be taken into account under the plan until he has completed a year of service (as defined in paragraph (3)) after his return. 410(a)(5)(D) NONVESTED PARTICIPANTS. -- 410(a)(5)(D)(i) IN GENERAL. --For purposes of paragraph (1), in the case of a nonvested participant, years of service with the employer or employers maintaining the plan before any period of consecutive 1-year breaks in service shall not be required to be taken into account in computing the period of service if the number of consecutive 1-year breaks in service within such period equals or exceeds the greater of -- 410(a)(5)(D)(i)(I) 5, or 410(a)(5)(D)(i)(II) the aggregate number of years of service before such period. 410(a)(5)(D)(ii) YEARS OF SERVICE NOT TAKEN INTO ACCOUNT. --If any years of service are not required to be taken into account by reason of a period of breaks in service to which clause (i) applies, such years of service shall not be taken into account in applying clause (i) to a subsequent period of breaks in service. 410(a)(5)(D)(iii) NONVESTED PARTICIPANT DEFINED. --For purposes of clause (i), the term "nonvested participant" means a participant who does not have any nonforfeitable right under the plan to an accrued benefit derived from employer contributions.