Jean

I might take another path and in the letter simply state that per section/paragraph of your agreement you have decided to give x days notice that you will no longer provide administrative services starting on a certain date. I would not state in the letter the reason you came to this decision, let that be a telephone conversation.

After a diligent search, I cannot find any references that an ERPA can represent the plan sponsor (as an example) to the DOL. So that is my question, is the designation recognized by, and have the same weight with, both agencies? Primarily interested in 5500 filing for DC plans only--where the ERPA would be authorized to sign / file the 5500. Thank you.

We always required the form for the initial distribution. Per the W-4P instructions, "Nonperiodic payments—10% withholding. Your payer must withhold at a flat 10% rate from nonperiodic payments (but see Eligible rollover distribution—20% withholding on page 4) unless you choose not to have federal income tax withheld...You can choose not to have federal income tax withheld from a nonperiodic payment (if permitted) by submitting Form W-4P (containing your correct SSN) to your payer and checking the box on line 1. Generally, your choice not to have federal income tax withheld will apply to any later payment from the same plan." Increasing a hardship for applicable taxes is permitted and does not require that they be withheld at the time of distribution, but the individual could request that they be withheld. It should be no surprise that it is rare that someone would request the additional withholding.

If an amended 5500 requires a Schedule P, the schedule that applied to the filing year must be scanned into pdf and then filed as an attachment. My question is, must the actual signature be included on the scanned document? If yes, then it seems odd as it would be viewable on the site.

In a new comparability allocation, can you provide an allocation of 0% to one group if the plan does not have HCEs? I'm drawing a blank as to why it would not work.

As the DOL has not issued final regulations on when an employer must post a copy of their Form 5500/Schedules on their Intranet (used to communicate to their employees only and not the general public), is this item not currently required?

Generally no, unless there was another distributable event reason permitted by the plan. Moving to/from an eligible group is not a reason for a plan distribution. Does the plan document have a reference to this situation?

Hmm...maybe I have been looking at this as contributions due when really they are looking for benefits/payments? Or am I just so confused because "provide any benefits when due" is not explained. Line Item states: 4l. Has the plan failed to provide any benefit when due under the plan? Instruction is check 'yes' if any benefits due under the plan were not timely paid or not paid in full. Include in this amount the total of any outstanding amounts that were not paid when due in previous years that have continued to remain unpaid.

Instructions for Line 4l: check 'yes' if any benefits due under the plan were not timely paid or not paid in full. Include in this amount the total of any outstanding amounts that were not paid when due in previous years that have continued to remain unpaid. My list of contributions to report here include all nondiscretionary Top heavy QNEC Money purchase from previous years (also reported on Sch R) Safe Harbor required employer contributions Employer match Not salary deferrals because they are reported on 4a (failure to transmit participant contributions within the DOL timeframe) Comments?

Your post doesn't provide much information...was there a court order issued upon your divorce (sometimes referred to as a domestic relations order or QDRO) that directed a portion of the 401(k) funds to be transferred to you? If yes, has it been delivered to the employer and/or plan administrator (usually the same person) of the plan? If it was delivered, you should have received written acknowledgment that it was received and the steps the plan administrator will follow in reviewing the court order.

Done. as for fees, we charge a little "eggtra" for it!

When a plan terminates, participants lose the rights they had under an active plan. I'm not convinced that the loan policy must state default occurs upon plan termination. A loan repayment is a contribution to the plan. Contributions to the plan should have ceased on the date the board declared the plan termianted. This would result in a forced default of nonpayment.

Right! The employee should not get a double benefit if he fails to return the funds as requested. While EPCRS is great for giving guidance on how to correct these failures, it does not address the procedural steps for completing them.

Agree that proper correction is restore the plan. Is this going to be treated as insignificant error that can be corrected at any time? From EPCRS, Overpayments: © Overpayment. The term “Overpayment” means a Qualification Failure due to a payment being made to a participant or beneficiary that exceeds the amount payable to the participant or beneficiary under the terms of the plan or that exceeds a limitation provided in the Code or regulations. Overpayments include both payments from a defined benefit plan and payments from a defined contribution plan (either not made from the participant's or beneficiary's account under the plan or not permitted to be paid either under the terms of the plan or under the Code or regulations). However, an Overpayment does not include a payment that is made pursuant to a correction method provided under this revenue procedure for a different Qualification Failure. Overpayments must be corrected in accordance with section 6.06(3). 3) Correction of Overpayment failures. An Overpayment from a defined benefit plan is corrected in accordance with the rules in section 2.04(1) of Appendix B. An Overpayment from a defined contribution plan is corrected in accordance with the Return of Overpayment method set forth in this paragraph. Under this method, the employer takes reasonable steps to have the Overpayment, plus appropriate interest from the date of the distribution to the date of the repayment, returned by the participant or beneficiary to the plan. To the extent the amount returned to a defined contribution plan is less than the Overpayment adjusted for earnings at the plan's earnings rate, then the employer or another person must contribute the difference to the plan. The Overpayment, adjusted for earnings at the plan's earnings rate to the date of the repayment, is to be placed in an unallocated account, as described in section 6.06(2), to be used to reduce employer contributions (other than elective deferrals) in the current year and succeeding year(s) (or if the amount would have been allocated to other eligible employees who were in the plan for the year of the failure if the failure had not occurred, then that amount is reallocated to the other eligible employees in accordance with the plan's allocation formula). In addition, the employer must notify the employee that the Overpayment was not eligible for favorable tax treatment accorded to distributions from Qualified Plans (and, specifically, was not eligible for tax-free rollover).

Can you amend a plan to remove the EACA provision mid year?

This is not part of the stimulus, and it does not exist as of yet. It is an item that the administration wants (wanted?) to make available, but not necessarily in the stimulus.

Isn't the dollar value under 415© for this individual $0?

Go to Federal Register, December 29, 2004.

Although many people allow a 415 distribution, I differ on the ability to return the contributions as a 415 failure. Per EPCRS Program Eligibility Rule, SCP is not available to egregious failures. An egregious failure includes a contribution paid to an HCE that is several times greater than their 415© dollar limit. Presumably, the contribution paid is several times greater than their 415 limit. Finally, you will find that this type of error occurs year after year with self employed individuals who overestimate their income. Isn't that in itself an egregious error? .11 Egregious failures. SCP is not available to correct Operational Failures that are egregious. Egregious failures include: (a) a plan that has consistently and improperly covered only highly compensated employees; (b) a plan that provides more favorable benefits for an owner of the employer based on a purported collective bargaining agreement where there has in fact been no good faith bargaining between bona fide employee representatives and the employer (see Notice 2003-24, 2003-1 C.B. 853, with respect to welfare benefit funds); or © a defined contribution plan where a contribution is made on behalf of a highly compensated employee that is several times greater than the dollar limit set forth in § 415©.

Another valid reason for not allowing the negative loan repayment, and this would apply to traditional plan contributions also, is that due to market fluctuation, the value of the loan repayment in the plan is now worth less than when it went in. If you assume a one participant plan and the only contribution to the plan is the loan repayment (hypothetical), and the investment value dropped 20%, where is the additional funds going to come from to offset the reversal?

If the EGRRA determination letter for a cycle B plan is dated November 20, 2008, what is the last day to adopt the plan? The determination letter references section 401(b), but that doesn't make it any clearer. If this is a calendar year plan is the deadline 12/31/08?

Well, where's our number cruncher with the '09 limits?

Isn't there an exposure to a plan stating ordering rules if they conflict with any State laws? I agree that the employer should approve the ordering rules, and have employee acknowledge them, but not that the plan should define them.

It is probably a enable/disable type control in the Internet Options security. Go to Tools, Internet Options, Security, Custom. Not sure which item you have to pick (I know not helpful), but maybe "Font Download". Report the issue to ASPPA books and / or Cyberisa. They really need to perfect the index so you can link to correct section from it.

If the individual is not catch-up eligibile, you may have a better self-correction approach by distributing as excess deferral. I have also seen cases where the excess (plus earrnings) is moved to a holding account, as you suggest. If the contribution is moved out of the individual's account and stays in the plan, the individual will need to receive an additional payroll payment equal to the excess deferral only (no earnings).