Mike Preston

Contact Derrin Watson.

I would be shocked if the result, after following ETK's good advice, is not that you use the new hire date.

It was a lot funny. Alex, read it again then ask yourself: "How many people do you know that work 24 hours in a day?".

IT depends on the dollar amount involved and the willingness of the participant to go along with the levy. If the participant is eligible for a distribution from the plan, the levy is for less than 10% of the account balance and the participant indicates his or her willingness to go along with it, it shouldn't violate 401(a)(13). However, the plan has to have the optional provisions of 401(a)(13) and most plans don't.

Remember, all IRA's are combined for purposes of RMD's. Hence, if the 5 year payout exceeds the RMD based solely on the annuitized amount by $1, you can reduce a distribution from one of the other IRA's by $1. I don't buy the fact that the annuity has no stated value. Ask the annuity company what the interest rate is that they are using to develop the 5 year certain amount. That will tell you what the actual value is at the beginning of the annuity stream.

Raise his average comp to 205000, otherwise, your calculation is within a few hundred dollars of mine.

True, but it could just as easily be the result of a class exclusion. There is nothing wrong with having a class exclusion combined with individual allocation groups for those that aren't excluded. But I know you know this, I was just pointing it out so that the thread covered the issue.

Tom, the IRS' warnings are only applicable if one or more of the individual groups gets an allocation percentage of zero.

It is very rare for any disability benefit to be included in the benefits awarded to the ex-spouse in a public plan. Doesn't mean it can't happen, just that it infrequently does. Yes, you need to see what the QDRO says, but that is only part of it. Since you say it is a public plan they are not subject to ERISA and therefore don't have to follow the ERISA rules on QDRO's. Hence, you need to check with the plan to see what their rules are!

A QDRO can't pay outside the terms of the plan. If the plan allows lump sums and the participant quits, that is a plan design issue. Similarly, having QDRO's pay before earliest retirement age is allowable, but not required. I think it all boils down to plan design.

They are not through the Personal Messenger. They are just randomly posted messages, usually to existing threads, but sometimes they start their own. I just obliterate them as soon as I see them so unless you use your super-duper-admistrator tools to look at deleted messages you won't see them through normal means.

Check the definition of Former HCE in 414(q). I think you'll find that you end up treating him just like the other two owners. To do otherwise could lead to massive abuse.

The old system used to display the date and the TIME of the last post, didn't it? I found that quite useful.

Peter,It is fair. And I don't worry about it making me a de facto administrator (fiduciary) to the plan. I have always cited Shofer v. Hack: http://www.leagle.com/xmlResult.aspx?xmldoc=1991416324Md92_1408.xml&docbase=CSLWAR2-1986-2006 If, based on those facts, the court comes to the conclusion that: "For purposes of this appeal the respondents are not fiduciaries under the ... plan." then I find it hard to believe that we can be construed as ERISA Plan Administrators unless our contracts make it clear that we are accepting that role.

This thread was brought to my attention that the conclusion reached herein which deals with whether a component plan must, on its own, satisfy the reasonable classification test is different from the conclusion reached about 10 years earlier in this thread: http://benefitslink.com/boards/lofiversion...php/t13181.html I still hold to the position taken in the earlier thread and believe that the IRS does, too.

1. You are correct, it is not adjusted. Just for the curious, under what circumstances is the 415(b)(1)(B) limit adjusted? 2. Correct, but in fact it is $50,000 as a life or J&S. The form you have in this plan (10 yr C&L with COLA) requires a number lower than $50,000. But I agree that would devolve into $50k at SLA. 3. Since the plan doesn't provide for suspension of benefits you already have an impermissable forfeiture. Looks like EPCRS time. 4. The EPCRS correction might very well involve a RASD solution. Don't think you can do one on your own unless you want to fit into the small nooks and crannies of EPCRS self correction. Good stuff makes for sharp pencils!

You went from merely having individual allocation groups (which doesn't preclude use of ABPT) to declaring that at least one individual would get ZERO. I'm not sure I agree with the IRS on their interpretation, but I am aware of it and let clients know that giving somebody zero might subject them to the 70% rule on coverage AND non-discrimination.

Correct. So, whoever you got your UP84 tables from should be willing to send you those same tables based on a different mortality table (in fact, they should have sent you all the standard mortality tables when they sent UP84, unless there is some reason that they were hardwired to UP84).

Well, I sort of agree with everything but the last sentence. Unless you are getting a gazillion dollars suing for lost interest will be a money loser (unless you can also get costs - always an iffy thing). But there is no harm in requesting things in writing and having receipts for documents that are sent their way, such as certified mailings.

No. Go fish.

If it is just a PS plan and no DB plan is involved, you can't use pre-retirement mortality, so the mortality table doesn't really matter. As long as nobody is beyond testing age you can use the same factors that you use. Try this: 1) Take a factor (under UP-84/8.5%) for any age. 2) Take that same factor for one year younger. 3) Divided 1) by 2) Is the result 1.0850000000? That same result will happen if you use 71IAM-M as the mortality table. Do you have anybody whose age exceeds what would be their testing age?

The answer is no, a new QDRO does not need to be drafted. There is a citation somewhere (I think on the DOL's website regarding QDROS, but I'm not sure) that basically says that the purpose of the identifying information is to, well, identify the parties. If the plan is convinced they have the right parties it is completely unnecessary to modify a QDRO should it be found there is a typo or two or three. Hence, this is up to the folks that administer the plan and I would suggest to them that there is no ambiguity in the identification of the party involved so there is no need to update the QDRO.

You are right. I misunderstood what you meant when you said that coverage testing was being satisfied on a benefits basis. Technically, one doesn't satisfy coverage on a benefits basis. Technically, one runs the ABPT on a benefits basis and then uses the results to determine what the required coverage percentages are. If that is what you meant when you said that coverage testing was being satisfied on a benefits basis, then I withdraw my comment. This stuff gets confusing because each part of a plan (401(k), 401(m), employer contributions) winds their way through the same language with slightly different twists. For the sake of simplicity lets keep it to employer contributions. First, they have to satisfy 410(b) which is coverage. There are two heavily used options in the 410(b) regs. The first is benefiting NHCE's to the tune of 70% of the % of HCE's benefiting. This is the "ABOVE" test I'll reference later. In this context benefiting means getting 1 cent in employer contributions (some people are uncomfortable with 1 cent so they insist that in order to be counted you have to get $1 or $100). So if there are 100 people total of which 50 are HCE's and 50 are NHCE's then if 20 HCE's benefit you only need to see that 14 NHCE's benefit and you would pass coverage using this test. Assuming you have less than 14 NHCE's, the second option to satisfy coverage is to satisfy the Average Benefits Test (ABT). This is a two part test that consists of the ABPT and the non-discriminatory classification test. The ABPT is (usually) an employer wide test (there are some exceptions) but it basically requires that the "benefits" of the NHCE's average 70% of the benefits of the HCE's. Note that in this test it is all contributions of the employer including 401(k)! In this context benefits can be measured as contributions or cross-tested (and if cross-testing you can test either annual or accrued to date). No matter what you use here you DO NOT TRIGGER GATEWAY. If you pass the ABPT then you basically re-do the 70% from "ABOVE" with a lower threshold of the "safe-harbor percentage" (which is a high of 50% and a low in the low 20% range, see the regs for a chart). Again, all you are doing is counting bodies that "benefit" and comparing the percentage of NHCE's to the percentage of HCE's. In the example cited above the safe-harbor percentage is 50% so you would only need 10 NHCE's to benefit rather than the 14 shown above to satisfy coverage. When performing the non-discriminatory classification test for coverage purposes you might have a resulting percentage which is not quite the safe-harbor percentage, but still exceeds the un-safe harbor percentage. If that is the case, you can still say you pass coverage if the facts and circumstances warrant. Best to avoid this, though, as it is usually easy to cover the safe-harbor percentage. There are a few more options to satisfy coverage but they apply in limited circumstances so I'll ignore them. Satisfying coverage is usually the least of your worries. Then we have to do it all over again for non-discrimination testing under (a)(4). Here, we establish a testing method (contributions basis, cross testing on an annual basis, accrued to date) and we establish rate groups (which I assume you know how to do). The percentage of NHCE's that must be in each rate group is either: 1) 70% (just like "ABOVE"); or, if the ABPT is satisfied (usually the exact same ABPT we used when we determined whether the plan satisfied the coverage requirement of 410(b)), 2) the mid-point between the safe-harbor and un-safe-harbor percencentages. When establishing the testing method under 401(a)(4) we are subject to the gateway requirements if the testing is cross-tested. There are a gazillion options and safe-harbors not discussed above as the above is the barest of descriptions regarding coverage and non-discrimination testing.

How about allowing the sale to close before opening the buy order?

Sorry to be so disagreeable, but you are wrong. Cross-testing the ABT does not subject you to gateway. If I recall correctly, there is a Blue Book Q&A directly on point, as well as an ASPPA Q&A directly on point. This is something that comes up every once in a while and needs to be quashed. Maybe somebody else (like Tom - hint, hint) can post the Q&A's.