Mike Preston

Certainly not a fanciful imagination. I have never heard of the "not a material modification" standard.

Two separate controlled groups. 410(b)(6)(C ) is your friend for 2014 and 2015.

mbozek is needlessly complicating things. At this point there is no need for an attorney. Just politely point out to the financial institution representative that the surviving Trustee has the right to move the investments and provide the documentation that supports that position. Go up the food chain until somebody with a brain is found. It is a pooled fund, balance forward plan. There is nothing to segregate. Hopefully, the account was established by both Trustees. It is a bit more complicated if the account was established by the deceased Trustee alone, but not fatal.

Nice cite, thanks.

QDROphile, can you provide a citation that precludes an alternate payee from receiving benefits due under the plan? I'm not talking about changing the amount being paid. I'm not talking about changing the measuring life. I am merely talking about changing the recipient. Consider it a shared payment QDRO where the share is 100%-0%.

In the OP's situation I would recommend that he encourage the for-all-intents-and-purposes-CFO to find a competent ERISA advisor that specializes in designing plans that are intended to maximize benefits for small groups of participants. From the sounds of it, a targeted plan might enable a tax deferred allocation in 2015 of the maximum allowed ($53,000 less the allowable 401(k) and match) at an employee cost that might be as low as $2,000. Best of all this can be hung on the existing plan and you wouldn't even need a new plan. I seem to recall that the preamble to the 204(h)/4980F PPA regulations changed "204(h) notice" to an action rather than a singular noun. Taking just a snippet from the preamble: "This Treasury decision amends the regulations under section 4980F of the Code to reflect provisions in PPA ’06. Section 502© of PPA ’06 amended section 204(h) of ERISA and section 4980F of the Code to require that section 204(h) notice be provided to any employer that has an obligation to contribute to the plan." Have you been 204(h) noticed lately?

You need to pin down the benefits that the soon to be former spouse does not want. It sounds like both are currently alive so you could be talking about a portion of the primary annuitant's benefit. Alternatively, you might be talking about the soon to be former spouse's receipt of the QJSA. Or both. The benefit amounts are fixed in stone (it is forever equal to the primary annuitant's entitlement under the plan payable as long as the primary annuitant survives plus the secondary annuitant's entitlement payable after the primary annuitant's death). The recipient can be changed to a different person providing said different person is an alternate payee and they get a new QDRO directing the payment to the alternate payee.

Go further up the food chain.

Read Bird's response again.

I agree with Effen's technical analysis and point. I disagree with his moderator action. A message should generally not be subject to editing. If it runs afoul of our collective sense of decorum it should be obliterated.

I think people are focusing on the wrong technical term. A distribution in the year a participant reaches age 70 and 1/2 is attributable to the first "distribution calendar year". A distribution (of sufficient amount) made in the first distribution calendar year satisfies the rules of 401(a)(9). The fact that it took place in the year before the RBD is irrelevant. I agree with the others that a plan can be designed so that the rules of 401(a)(9) don't kick in for a non-5% owner until separation from service, but if this plan calls for the rules of 401(a)(9) to apply at 70 and 1/2 even for non-5% owners I find it hard to believe that a distribution in the first distribution calendar year is a problem.

1.410(a)-7 has the rules for using elapsed time as it applies to eligibility (and vesting and benefit accrual). If the plan calls for use of elapsed time then the employer should know those rules. What am I missing?

The ASD isn't established until all acts have been completed, not just acts of the Plan Administrator. Unless you have a retroactive ASD provision that is scrupulously followed.

Why c an't you use the DOL equivalencies to determine OE?

Yes, you use the same Trust ID on all investment accounts held under that trust, no matter how many there are.

John, I'm in disagreement with your characterization. I won't belabor the point but to the extent the rules are clear and unambiguous I don't think 1©(2) has any impact and is not to be used by the IRS to justify an attack on a non-discrimination test done in good faith. The Carol Gold memo and the Paul Shultz (sp?) memo provide the only exceptions. The key point is that without a documented exception like the memos referenced I don't believe the IRS will attempt to invoke 1©(2) to invalidate a test that is otherwise done in conformance with the unambiguous rules of (a)(4)/10(b), etc.

Any competent provider with their own volume submitter plan could take on the task.

I was just referring to comments others have made. You'd have to ask them. I would suppose it would depend on the level of sophistication of the client and the other client advisors intimately involved in the decision to go along with said amendment. What do you think?

Prototype? Usually incompatible with an advanced plan design. Some (not me) have been known to say that, alone, is enough for malpractice. Assuming your plan document has provisions that allow what you describe, all should be well. I doubt they exist in a prototype, though.

You kind of missed my point. "Approximately"? How about by an order of magnitude OR TWO. If the total "button pushing" is based on 10,000 plans being sold a year, at $4,000 a pop there is 40 million in play. Using the tire analogy with 5 billion tires at $5 per balancing there is 25 billion in play. Divide by 10,000 plans and each should have a price tag of roughly $2,500,000! Using the stock example, at an average of 100 shares per $1 order the revenue from roughly 250 billion shares would be (250 billion divided by 100 times $1), when divided by 10,000 plans about $250,000!!! Not as high, but hey, we are just spitballing here, right? In that context (assuming the economy of scale that the OP thought might be applicable) anything less than $250,000 (per the OP's reasoning) would be a bargain!!! I'm pretty sure the OP understood that I was pointing out with the absurd mathematical comparison that the economy of scale logic he gravitated towards was a wee bit off the mark.

You are, if nothing else, entertaining. There are a billion tires sold annually, there are about a billion shares traded every day. I would be very surprised if there were more than 10,000 one-participant DB plans sold in a year. Do the math and I think you'll find $4,000 is a steal!

Correct on all counts. I might be worried about a -1©(2) violation if the only people under 21 are the HCE children if the intent is to give them nothing, but maybe that is just me.

While what you have indicated may be correct in most circumstances, it is not technically correct. To avoid non-discrimination testing the formula in the plan has to actually be a safe harbor. Hence, if you allocate as if you had a safe harbor integrated formula you still have to do a non-discrimination test. Most of the time you will then perform the non-discrimination test on the basis of contributions, rather than benefits. So you won't typically be using cross-testing. But you still need to do a non-discrimination test. All of that is academic if the allocation is done as if you had a safe harbor integrated formula AS LONG AS THE SAFE HARBOR FORMULA USES 100% OF THE SOCIAL SECURITY WAGEBASE. If you use one of the optional safe harbor formulas which uses a lower percentage of the Social Security Wagebase then you can easily run into a circumstance where the allocation will FAIL non-discrimination testing even though it faithfully allocates in accordance with a safe-harbor formula.

Does anybody else's head hurt when they see the word "Valuated"?

I think the employer has to make a 436 contribution which allows the 401(a)(4)-11(g) amendment to take effect.