JanetM

Hmmm, let me guess.... the pension assets have protected benefits attached and the employer is trying to get around them by putting them in IRA.... Off the top of my head I don't see how you can force trustee to trustee transfer of these assets to IRAs without terminating the entire plan. If they want to do this they could do it by amending the plan to allow in-service withdrawal of pension assets? They can't force the assets to roll to IRA as participants will have option of taking cash.

GBurns, there are numerous cases where companies with truckers have lost to multiemployer plans. This is the first that comes to mind. US-CT-APP-7, PENSION-CASES ¶105,325, NESTLE HOLDINGS, INC. and NESTLE TRANSPORTATION COMPANY, Plaintiffs-Appellants, v. CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, Defendant-Appellee., (Sept. 05, 2003) You can begin with ERISA 4201 to learn about withdrawal liability.

Gaham, I don't know about any groups. Using the old adage "misery loves company" you would think there would be hundreds of groups out there.

Actually GBurns, the rules surrounding Multis are terrible. You can't just replace union folks with non union folks who do the same work in the geographic region. You can't reduce the numbers siginificantly without triggering partical withdrawal. The rules get you coming and going, if you are in one of the seriously underfunded plan you know you are going to pay - the only question is how much and when. If there is easy way I want to hear it, we are participating employers in 3 multiempler plans and would love to jump ship in all of them.

Wouldn't life be grand if we could just stop using those union workers who cause us to contribute to those plans. OMG now I remember why...................... the millions and millions it will cost for the withdrawal liability. Yes that was definately it. Note to self: the cost is 5M a year to stay in, and oh about 50M to pull out. Yes am sure that was the answer.

Yes you do. 401(a) covers multiemployer plans. Qualified plans There is a checkbox in Box 13 of Form W-2 that must be utilized for reporting deferred compensation (.15 ). It is captioned "Retirement plan" Check this box if an employee is an active participant (defined below) in any of the following: (1) a qualified plan maintained by the employer or a collectively bargained plan under Code Sec. 401(a) including Code Sec. 401(k), (2) Code Sec. 403(a), (3) Code Sec.403(b), (4) Code Sec. 408(k) (SEP), (5) Code Sec. 408(p) (SIMPLE), (6) Code Sec. 501©(18), or (7) a government plan other than a Code Sec. 457 plan.

I agree with you, the 10/01/06 is the date you can add roth.

I copied it right out of the distribution answer book. Entire Q is the following. Q 2:4 What limits does the Code impose on the amount of a plan loan? A plan loan is not treated as a taxable distribution (i.e., a deemed distribution) to the participant or beneficiary to whom it is made if its amount (when added to the outstanding balance of all other loans from the plan and all other plans required to be aggregated with the plan) does not exceed the lesser of: 1. $50,000, reduced by the excess (if any) of: a. The highest outstanding balance of loans from the plan during the one-year period ending on the day before the date on which the loan was made, over b. The outstanding balance of loans from the plan on the date on which the loan was made; or 2. The greater of: a. One half the present value of the vested accrued benefit of the employee under the plan, or b. $10,000. [i.R.C. §72(p)(2)(A)] For purposes of item 2a, the vested accrued benefit is determined without regard to any accumulated deductible employee contributions (QVECs). [i.R.C. §72(p)(2)(A)] Also, for purposes of 2a, in determining an employee's vested accrued benefit under the plan, a valuation within the last 12 months may be used. This value must be adjusted for any distributions or contributions made after the relevant valuation date and before the date the loan is made, but it does not have to be adjusted for subsequent gains or losses after the valuation date and before the loan date. [Notice 82-22, 1982-22 C.B. 751] If an employee's outstanding loan balance is not more than one half of the present value of his or her vested accrued benefit under the plan immediately after the loan is made, the loan is not treated as a taxable distribution (i.e., a deemed distribution), if that present value later decreases, including a decrease because of a distribution made to the employee. [staff of the Joint Comm. on Taxation, General Explanation of the Revenue Provisions of the Tax Equity and Fiscal Responsibility Act of 1982, H.R. 4961, 97th Cong., 2d Sess. (1982) (the "TEFRA Bluebook") at 296]

The rule is .......... $50,000, reduced by the excess (if any) of: a. The highest outstanding balance of loans from the plan during the one-year period ending on the day before the date on which the loan was made, over b. The outstanding balance of loans from the plan on the date on which the loan was made; or For highest outstanding balance (o/s) you look at past 365 days to see what the highest number was during the year. In this case the highest o/s balance would be 30K. o/s balance on 12/15 would be 50K (assuming that is what he wants). So you reduce the maximum 50,000 loan limit by 33,000/50,000 and the most he can have is 30,000. Had this same deal with doctor years ago who thought he could borrow 50K and pay it back in couple months and take another loan.

If it should be W-2 comp and the employer corrects from 1099 classification, he also has to ante up for social security and medicare on those amounts so he is legal. He doesn't have much time left before year end to get this sorted out.

E is right, you don't seem to understand the concept of Trustee vs participant direction and brokerage accounts. You should look for some who has some knowledge in this area.

Tom, you realize that this will totally distract me from working on financial stmts and an RFP for audits. I owe you one for that! My ordinary work was driving me batty.

Last I dealt with this the numbers were the same as 410b and 401a4 coverage. So if you have at least 70% NCHE who have ability to self direct you are okay. If not the plan needs to make some changes. Minimum balance requirements rarely pass the test

My opinion on A would be. They are totally separate employers and Bs actions don't affect the outcome. There were 4 employees at A. A made change in office location. Two employees didn't take up offer of working in new location - consider those voluntary terminations. Two employees were terminated as they were not offered positions in new office. As the two terminated make up a LOT more then 20% of workforce they would be vested. Seems to be a gray area on the two who volunarily leave. Why not just vest them and get on with life? Isn't like it will cost A any money out of pocket since the money has already been pait to plan. Yeah you can say that it reduces the forfeiture amount allocated to remaining participants but is that a reason to not vest them?

From what you wrote I see it as being more a Trustee directed plan and neither 2G or 2H would be marked. In General ..... 2G is used for true individual account plans where participant makes all investment elections. 2H is used for participant directed plans that also have employer contributions (match, profit sharing) whose investment is directed by Plan/Trustee.

You are correct, you either have to merge the plan or leave "as is" in frozen state. If one plan is frozen it makes sense to merge. You give participants more access to funds, you reduce fees and you simplify life overall.

Maybe I am reading too much into it... What kind of plan and who is the plan sponsor? Are the doctors both sponsors? Does one doctor sponsor and the other sign on as participating empoyer? Are these employees getting W-2 from each doctor? Or single W-2 from third entity we don't know about like a partnership or leasing company?

You still have five weeks to mail them papers for signature. Are they in the Antartic or somethinng?

If funding falls low enough, the excise tax imposed by IRC 412 and IRC 4971 will be imposed on contributing employers. Since those are required by law they can't be avoided by saying the CBA doesn't require them.

Do you have an investment policy statement? What does it say? The final outcome is not the issue actually, the process you followed to select the funds will matter more. Do you have a consistent process that is followed to select and vet the funds?

Here is what the SMW sent to all of us poor participating employers. FundingIncreaseNotice.pdf

Have a couple thoughts, but am not an expert in this area. Think it is section 105 that deals with discrimination in self insured plans. That section refers to employees so I don't think it applies to the first situation. Can you set up non qual plan for these retired directors? You would have to impute the income to them, but you could gross it up. The only downside is your stop loss carrier may not cover this person or group.

It would be simple enough to amend the plan to allow for age withdrawals for employees who are still employed and attain a certain age.

Is this deferal only plan? Employer money counts too.

Am not an expert on this so I will offer you an alternative idea. How about a cash bonus, you could even gross it up if necessary.