jpod
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Everything posted by jpod
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Another thought. Can the ex-spouse afford to buy the policy from the plan? I am wondering if the PT exemption that allows these purchases can be used in this instance. If she can do that than she can roll the $120,000 cash to an inherited IRA and there will be no immediate tax consequences to her.
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Great point by FGC. Will the cash value support the MRDs to this non-spouse beneficiary? By the way, just dotting all the i's, but there is no surviving spouse here, or is there a surviving spouse who had properly consented to this other beneficiary?
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It sure does. That means Bill Presson has hit the nail on the head. I don't have an answer without researching.
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Hmmm. Care to elaborate? Why couldn't she just roll to an IRA? Are the assets illiquid? She can probably find a trust company willing to hold them in an IRA and she can transfer in kind.
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It is not a pt.
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You may find that the plan document contains an "anti-cutback rule" that mimics what a plan subject to Section 411 is required to say, in which case you likely would have a problem under State contract law if you unilaterally amend in a manner that violates that language.
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Who should sign the Form 5500? Trustee changed after year-end.
jpod replied to 401king's topic in 401(k) Plans
Since when does the trustee sign the 5500? Has something changed for 2017? -
You said that there was no beneficiary designation. That must mean that the father is the first one in the list of default beneficiaries who actually exists (and there is no mother). Correct?
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Prohibited Transaction - practical effect?
jpod replied to Belgarath's topic in Retirement Plans in General
If structured properly going forward, I think you can use 80-26: Employer makes the payment on behalf of the Plan using employer money, and AFTER THAT (can be a nanosecond after that) the employer is repaid by the Plan. If employer doesn't want to do that then open up a checking account in the name of the Plan/Trustees. -
"Believing" is nice, but your question is not fully answerable without knowing whether the beneficiary is the father or someone else. In any event, Step 1 is to undo that intra-plan transfer and put the money (plus earnings, but probably not minus losses) in the son's account. There should be no tax-reporting associated with that erroneous transfer to the father's account. Let us know who the beneficiary is and we can help with Step 2.
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You have an obvious problem here, but before addressing that the first question is who is beneficiary of the son's account balance?
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Isn't this putting the cart before the horse? Can a rollover by the spouse be effected if the non-taxable division has not occurred?
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And it's not just the commission on that sale, it's the extra bump up on the grid before the year ends.
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Oh no, Mike, please say it ain't so!
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You can't.(?)
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ETA Consulting: I assumed that the standing deferral election applied to all W-2 compensation, so as to include bonuses. If the standing deferral election applied only to "regular pay" or something similarly-stated, you could be correct.
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No good deed goes unpunished. Maybe you can get a more favorable result in VCP, but absent that: Q1 = yes; Q2 = forever.
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Seriously, even if it's permissible, how many employers really charge their plans' participants for these types of things? What do you tell them? Do you say "the plan paid $XXX for a study to make sure we are living up to our fiduciary responsibilities"?
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If you take the position that the plan was never terminated in the first place, what are the implications with respect to the distributions made to active employees (if any) at the time it was thought to be "terminated"?
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Court Date Tomorrow
jpod replied to ParticipantPensionLimbo's topic in Qualified Domestic Relations Orders (QDROs)
Question for BenefitsLink regulars: Can the estate of an ex-spouse be an alternate payee? The statutory language suggests "no." Is there case law to the contrary? -
I would argue that it wasn't a contribution to the plan in the first place, so the employer is entitled to recover it without regard to 401(a)(2)'s exclusive benefit requirement (which is the rule to which the mistake of fact exception is an exception).
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Non-adopting employer allowed to participate
jpod replied to K2retire's topic in Correction of Plan Defects
Maybe there is legal counsel who was involved in the underlying transaction who dropped the ball and can be persuaded to "chip in." -
Non-adopting employer allowed to participate
jpod replied to K2retire's topic in Correction of Plan Defects
I would have to parse through all of the relevant language of the Rev. Proc., but I am assuming that the "early inclusion" rules contemplate that the employer has a plan in place and, therefore, self-correction under those rules is not available. Sounds to me like it would be a slam dunk in VCP. -
I see no choice but to use VCP, but it doesn't sound like a "non-amender" candidate to me.
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The answer is that you probably can do that, but you need to be speaking with your lawyer. You are not going to get the individualized advice you need on something like that from a message board.
