Mike Preston

Yes.

PLONK

I found, online, the EGTRRA Basic Plan Document 03 at: www.fidelity.com/static/dcle/ira/documents/se401kfrp.pdf Does anybody have a link to the GUST document?

Escrow is relatively easy.

See 1.401(k)-1(e)(6) "Other benefits not contingent upon elective contributions"

Not allowed.

Tom, how sure are you on this, because I thought the concentation percentage was like the HCE determination - it is an employer wide determination which then applies to all the subsequent tests.

My apologies, despite the thread name and the confirmation in one post that this calculation was for 2012, I was doing my calculation based on 2013. Sorry for the confusion.

I think this issue has been laid out in prior discussions. The Congress changed the Self Employment calculation when the 2% was removed to have the net result be the same as it was before the 2% was removed. Basically, go back to 2010's spreadsheet, but use the current years SSWB. If BenefitsLink can search on numbers, look for threads that have 59.6% in them.

Yup.

I get $260,536 for the first number and $176,917. Maybe my spreadsheet has a bug?

Be advised that failing the comp ratio "barely" may indeed mean that it satisfies 414(s). Go back and read the code and regs and you may be pleasantly surprised.

Yes, as long as the BRF's don't create an issue, as already mentioned. I don't see any reason why you would want to test the 401(k) feature on the basis of G alone. Aggregating makes it pass, doesn't it?

I think it is fine, too, but please be aware that some folks at the IRS think that the ordering of things is material. There have been many long threads on this issue.

It would be administratively burdensome to require a specific annuity quote when explaining the QJSA. We "estimate" it and then explain that the actual amount of the annuity will depend on the insurance company's assumptions. But it has been a long time since we actually dealt with a pure money purchase plan. Most of the time we are now dealing with money purchase monies within profit sharing plans.

Yes, but it matters greatly what the "plans" are that are being tested. 401(k)? I don't see an issue. Match? Already determined not to be an issue. The only potential issue would be a PS contribution made solely to G. Is that what is going on here?

"Secondly, because the plan is still using the 30-yr rate for lump sums (and didn't change within the approved window when the law changed to the segment rate method) I think you are stuck with the 30-yr rate at least on benefits accrued before the change. Secondly, because the plan is still using the 30-yr rate for lump sums (and didn't change within the approved window when the law changed to the segment rate method) I think you are stuck with the 30-yr rate at least on benefits accrued before the change. " This is the crux. I don't have time to look it up today but I thought there was an exception to 411d6 notwithstanding the timing of the change in 417(e) rates which conform to PPA. This would mean that it is critical how the document is drafted. If the 30yrTSR was referenced only once and "replaced" for 417(e) purposes by the applicable rates then it very well MAY escape 411(d)(6) protection. At this point, the issue is highlighted and it would seem that the best course of action would be for the plan to hie thee to an ERISA lawyer!

Andy, I think it best to keep the discussion here, where the most can benefit from it. I stick to my position that the PBGC is the most consistent of the governmental agencies. Maybe they weren't quite so consistent back in 2008 (which is when the thread your link points to was active). And, IMNSHO, yes, the PBGC will be glad to respond to a request for determination as to whether a plan is covered and they will stick to it.

Until we get specific guidance on this issue, however, I think the structuring of the distribution pattern is critical to determining whether the first few distributions are ERD's.

Stuff gets complicated, doesn't it?

Not exactly. I stated earlier that you can use the same factors as long as nobody is beyond testing age. You are now saying almost the same thing but substituting NRA of 65. You are correct if NRA is 65, but if NRA is 65/5 then testing age may be 65 or higher.

When the cost of correction is large in relation to the dollars being re-allocated, I shy away from asking for full correction and instead lean towards leaving accounts alone (albeit NHCE's are too high and an HCE or two is/are too low).

Caroline, I don't agree. The one year rule is specific only to the substitution of one 417(e) rate for another. "Regular" actuarial equivalence has permanent 411d6 protection with respect to the accrued benefit on the date that the assumptions were changed. If they had changed from 30yr Treasury (old 417(e)) to segment rates (new 417(e)) on a timely basis, I don't even think there is a year overlap. This area confuses many.

Andy, I've never seen the PBGC go back on their word, whether informal over the phone or written on their website. Can you describe in more detail?

A. Technically, yes, but since you can't use SCP as the 2009 year error makes you ineligible to do so you can, via VCP, suggest that the HCE not be changed. If the IRS goes along with it (which I believe they will since each NHCE received more than they otherwise would have) you can just leave things as they are. B. Corrections don't count as 415 annual additions in the year(s) made, so this is a non-issue. C. I wouldn't, but there is nothing wrong with requesting it via VCP. WIth a small group the IRS is unlikely to go along with it, unless there are compelling reasons to do so and, frankly, I doubt you could come up with such a reason given the owner made max comp and received a max allocation.