Belgarath

I'm awfully glad I didn't like pumkin pies to start with... I actually know someone (I'm not making this up) who would occasionally smear pumpkin pie filling on his shoe before going into a dinner party. While sitting in the living room, he'd position his shoe strategically so someone would be sure to notice and say something to the effect of, "Eeeww, you've got dog poo on your shoe." At this point, he'd reach down with a finger, scoop up some and put it in his mouth, and say, "Yup, you're right!"

Hi Tom - no, I don't see a CG issue here. There's no attribution under 1563 with adult children because neither owner has any ownership in the other business. I shoulda been a plumber. At least my compensation for dealing with excrement would be higher...

I own 100% of law firm A. My father owns 100% of law firm B. Now, for affiliated service group determination, we each own 100% of each other's practice, because there is attribution from family, and age is no object. BUT, if we are truly independent, then there's no ASG, because we don't meet the other requirements for ASG status - no regularly performing services for each other or third parties, no financial flow, etc... If we refer clients to each other, then this could throw us into ASG status, right - it it's regular and not just occasional? I hate ASG questions.

Bringing this back up, because I think my original response was a severe braincramp. I think the 402(f) notice requirement still exists, even though the plan doesn't have to offer a direct rollover option. I'd love to see some official guidance that says otherwise, but I'm not aware of any.

This is one of those stupid questions that annoys the life out of me because I don't think it makes much difference in "real life." Unfortunately, as TPA's we frequently deal with unreality. A plan owns a deferred annuity. Is the interest treated as interest, and hence reported on 10(g), or is it treated as "unrealized gain" and hence not reported? It makes no sense to me, in the context of a qualified plan, not to report this as interest. As an aside, if you choose to report it as interest when it really should be "unrealized gain" I can't see the IRS penalizing a client for disclosing it as interest. So the real life side is that I'm not sure it really matters all that much what you do. This issue doesn't arise on the regular 5500 form Schedule i, because you report the gain, whether interest or unrealized.

"The person who experiences greatness must have a feeling for the myth he is in. He must reflect what is projected upon him. And he must have a strong sense of the sardonic. This is what uncouples him from belief in his own pretensions. The sardonic is all that permits him to move within himself. Without this quality, even occasional greatness will destroy a man." The wisdom of Maud'Dib aside - you should be ok with "interim" amendments. I believe Revenue Procedure 2008-6, in Section 12 (.06) and (.07), states that terminating plans do not have to be restated. I haven't checked the 2009 version to see if this carries over, but you should be able to check fairly easily. And here it is, from 2009-6: Termination prior to time for amending for change in law .06 A plan that terminates after the effective date of a change in law, but prior to the date that amendments are otherwise required, must be amended to comply with the applicable provisions of law from the date on which such provisions become effective with respect to the plan. Because such a terminated plan would no longer be in existence by the required amendment date and therefore could not be amended on that date, such plan must be amended in connection with the plan termination to comply with those provisions of law that become effective with respect to the plan on or before the date of plan termination. (Such amendments include any amendments made after the date of plan termination that were required in order to obtain a favorable determination letter.) In addition, annuity contracts distributed from such terminated plans also must meet all the applicable provisions of any change in law. See also section 8 of Rev. Proc. 2007-44. Restatement not required for terminating plan .07 A terminating plan does not have to be restated. However, see .06 above.

Andy - I can't answer that. I only know they did. Also required that the instructions in the adoption agreement election, where they have the option to choose "other" as a normal form of retirement benefit, had to specifically state that it could not include any form of joint life annuity.

I don't know about you guys, but the IRS made us take a Jt life annuity out of the new (to be approved shortly, presumably) EGTRRA DB prototype as a normal form of benefit. Single life annuity allowed, but not jt life. So I don't see how you could fund for a form of benefit that isn't allowed. Are we the only people who had this happen? Of course, not being actuarially inclined, I'm probably misunderstanding the issue entirely.

Awesome!!!

You have to first exclude persons without an interest in both companies, as per the Vogel Fertilizer decision. So for B&C, even though you have an "effective control" group, (more than 50%) that group does NOT have a "controlling interest" (i.e. 80%) - you only have 75%. So I agree with the TPA that B&C don't form a controlled group, at least based upon only the information you have given, which assumes there's no additional attribution from stock options or whatever. Now, you MIGHT still have an affiliated service group, which is very dependent upon the facts and circumstances. So someone should take the extra step, and ask the client if their attorney has also reviewed this for ASG status.

Thou seekest the Holy Grail. In my humble opinion, no such thing as a "best" company exists. So much depends upon your individual needs and preferences. Is your risk tolerance conservative, moderate, or aggressive? How much money do you have to invest? What's your age and expected timeline? Must the investments be "socially targeted?" Do you intend to spend all the proceeds, or is leaving a legacy important to you, and if so, how much of your estate do you expect to be in the Roth? Etc., etc., etc... So while some folks here can, and probably will, give you some good ideas, possibly including specific investments and/or companies, as well as "independent" sources to use as a tool in evaluating some alternatives, I don't think anyone here could possibly tell you, honestly, what is the "best" company for your funds. What is best for someone else might be completely wrong for your particilar circumstances. Good luck.

Does the document define "paired plan?" In the limited situations where I've ever seen this, the plans were "paired" only if BOTH plans were standardized. Just a shot in the dark...

KJohnson - yes, that's what was suggested by the reviewer. So we tried it on the next one, but it hasn't had the initial review yet, so I can't report either success or failure. Based upon your experience, it sounds like one of those items that will depend upon which reviewer you get.

How come Ned Ryerson hasn't weighed in on this? The answer to retirement funds is, of course... Ignoring the sort of "tabloid journalism" slant of the article, it does highlight a basic point that all of us are quite familiar with, as retirement plan professionals. That is, the "old" model of paternalistic corporations providing comfortable defined benefit plans with little or no employee contribution is, at least for now with the current swing of the pendulum, largely over. I disagree that 401(k) plans are bad - the problem is, and it is true, that most most people: A. don't understand how much money it takes to provide a monthly payment of, say, 40-50% of their pre-retirement income, and therefore, B. don't save enough even if they CAN, and, C. many simply cannot afford to save the requisite amount. So the point that the average 401(k) participant will not have enough on which to retire "comfortably" is well taken. That fact is unfortunately misapplied to somehow shift the blame for this societal woe to 401(k) plans themselves. Which is, of course, absurd. The people in the (B) category above generally have only themselves to blame. I'm sorry if that sounds hard-hearted, but if I choose the expensive house over the moderate house, the fancy trips, the three cars instead of 1 or 2, etc., etc. and therefore don't have as much money at retirement - then I shouldn't hold 401(k) plans to blame. For those people in the © category, I sympathise - if every day is a struggle to simply survive, then you aren't going to be able to save a lot. I have no answers (or at least not good ones) to that dilemma, but I surely don't blame the 401(k) as being a "failure."

You've got my vote!

So didn't the attorney advise or recommend to them one way or the other as to whether a PT occurred or not? FWIW, it seems to me unlikely that they could prove no personal benefit. Absent the potential PT, the bank apparently would have foreclosed, and sold off the property, probably at a substantial loss to the "outside" portion?

Never having filed electronically before, we have questions on this just like anyone else. Does anyone know: If you are using a "third party web-based system" - once you enter all the 5500 data and send the e-mail to the plan sponsor to invite them to a "signing ceremony" - is this something that must be done immediately, and will you need to be on the phone with them or something crazy like that? Or, will they then be able to do their thing and file at their leisure (within the deadlines, of course)? I'm assuming the latter. But, thought I'd see if anyone has better information! Thanks.

General rule: no contributions of property to a PENSION plan. That's a prohibited transaction. General rule for a PROFIT SHARING plan - discretionary contributions of unencumbered property are allowed. Your question gets dicey, and I'd recommend seeking the advice of ERISA counsel before doing it. Is repaying a loan considered a discretionary contribution? I believe Morrissey v. Commissioner said no, it would be a prohibited transaction, but I don't recall if that applies only to pension plans, or if it applies equally to profit sharing plans. Someone else here on these boards probably does remember. See DOL regulation 2509.94-3 and IRC 4975(f)(3) for some background.

Nope, only 7 pages front and back. We combined it because we didn't want any potential errors where the wrong one got sent out with the wrong plan type.

Taking them as is and combining into a single document, with some VERY minor modification.

I agree. My trade talk was, of course, tongue in cheek. I think people expect way too much of rookie quarterbacks in general anyway. If I had a bunch of 350 pound gorillas trying to kill me every time I got the ball, I don't think I'd do so well either, but then, I'm not getting paid 16 billion per game, or whatever those guys make. And rest assured that the Yankees are hated everywhere. They are even hated by the smart people in New York (who, obviously, root for Boston) - it's just that in a city of 8 million, there are enough screwballs to manage a small rooting section for the Yankees. I had never actually seen any discussion of this component member issue, that I recall, until this thread. Is this something that came up much in a qualified plan context?

The "successor plan rule." See 1.401(k)-1(d)(4). P.S. and 401(k)(10)(A).

This is an interesting question. JTK - I'm not certain that the correction you cite is the proper correction for the specific situation. This correction is where a participant was not given an opportunity to make an election, and it is for a safe harbor matching situation. In the poster's situation, if I understand correctly, the participant ALREADY had a valid election in place, which simply was not followed due to the payroll company error, and the safe harbor is the 3% nonelective. It would seem that the appropriate correction would then be .05(5) instead of the .05(2)(d) you cited? However, and here's where it gets interesting - the basic correction for deferrals is identical to the (2)(d) correction, (QNEC of 50% of the "missed deferral") BUT, it doesn't seem to require the 3% nonelective! This seems odd to me, and perhaps I'm reading something wrong. But with this situation, you might have apparent IRS blessing to correct a 2% botched deferral situation by giving them a 1% QNEC and ignoring the 3% nonelective safe harbor. I wouldn't feel at all comfortable with this, and I would advocate any such correction add the 3% nonelective to whatever the "missed deferral" QNEC turns out to be. Thoughts?

"I'm not a football freak." Apparently, then, you are just a freak? In their own inimitable style, the BoSox clinched a wild card berth by losing their last 5 games, thanks to Texas. Maybe Boston could trade Dice-K to the Lions for a quarterback? Or work a three-way trade with the Tigers thrown in there - Verlander can quarterback for the Lions, Dice-K can pitch for the Tigers, and it makes no difference who Boston gets, because their trades typically end in disaster anyway. On a business note, I haven't looked at Derrin Watson's tome to see what, if anything, he has said on this issue prior to this clarification. If I get inspired sometime, maybe I will, but I am currently barren of inspiration.

Sorry, Sieve. I was reading from the Warlock's Manual PRIOR to the PPA (Permitted Permutations Advisory) 2006 update.