Mike Preston

Context please.

We have never had an issue with Ft William that they couldn't resolve within 24 hours. Try them again.

Neither Mike nor Shirley know of anything more specific than what has already been stated in this thread, as far as writings go. I personally asked Ira Cohen this question "way back when" and from that day forward I grandfathered with wearaway.

It has been asked of them and wearaway is their answer.

If you replace "can be" with "must be" the answer is yes.

Effective date is first limitation year beginning after 6/30/2007. So, in the case of a calendar year plan the benefit calculated as of 12/31/2007 can use the unlimited compensation, but on 1/1/2008 compensation has to be restricted by 401(a)(17).

I think if you work through the math you will not see a loss. The issue is one of assumed retirement date. You can only have one associated with a given portion of the liability in any one valuation.

And you would be 1/2 right, David. Or some reasonable approximation thereto. Long message to follow (sometime in 2011 if you can wait that long). However, since no additional service or compensation is required to have the EOY benefit completely determinable, you will never convince me that there is anything other than Funding Target at play here.

I didn't want to leave you hanging. It may take a while for me to dig into this. If I don't respond by 11/15 (not a typo), remind me.

I'm sorry, but we all have limited time that we can devote to questions like this. Yes, you must test each separate level of match under BRF. To repeat: "If plan 1 stands on its own with respect to coverage, then you may test it alone or combine it with plan 2 at your option when testing for non-discrimination." If you decide to test plan 1 alone, as Tom says, you would test all of the contributions in one fell swoop.

How would my example change in your interpretation?

What are you testing? You haven't described a single thing that requires BRF testing. You NEVER test contribution amounts under BRF. You are also confused about the amounts testing with respect to plans 1 and 2. If plan 1 stands on its own with respect to coverage, then you may test it alone or combine it with plan 2 at your option when testing for non-discrimination. With respect to the general test for the MP plan I don't think you have given us enough information. It may very well be that the service related formula satisfies one of the safe-harbors and does not require that it be general tested.

I agree that the 402(f) notice is technically not required. However, there is some information in that notice (or information which is similar to information which is in that notice) which is potentially helpful to a recipient of less than $200. At one point I went through the 402(f) and isolated what I thought was potentially helpful. Like others have already mentioned, our process is actually made simpler by having a Notice go out with all distributions. The Notice for those with less than $200 includes four sections and easily fits on a single page: 60 day rollover option Additional 10% tax if you are under Age 59 and 1/2 General Rules for Alternate Payees General Rules for Beneficiaries I can't imagine that it really makes much difference to include such information, but it is like chicken soup.

BRF testing is mutually exclusive to amounts testing.

"believed"? I think you'll find a number of Q&A's which indicate that the answer is "no." I'll let others comment on how the ABA chooses to word its questions and proposed responses.

Do you mean ADP/ACP instead of a(4)?

I'm not sure so don't take this for gospel, but doesn't it depend on what form is filed? And I'm not sure how to interpret the word "should". Do you mean in the context of if they don't they have a definitive problem? Or do you mean in the context of since it had an audit the last few years would it be a "good thing" for them to continue even if they don't have to? If the plan is eligible to file the form that doesn't require the audit, I would think there is no audit required.

The IRS has insisted that those methods be used for funding valuations when converting 412i plans to non-412i plans.

There is no easy way to say this, but your accountant should know, off the top of his/her head, that what you are proposing does not work. YOU are going to be paying taxes on every dollar that is paid directly to you by the plan. It will show up as part of YOUR taxable income. Period. You may then turn around and make a payment or two to your ex and that payment may in fact be deductible. But sometimes deductions don't directly offset income (ask you accountant about that!), so it is best to have the plan pay to your ex anything that is intended to be paid from the plan to your ex. If it can't be done, it can't be done. But don't delude yourself into thinking that by issuing a 1099 you will be able to avoid the rules on taxation, because you won't. Hopefully, you don't run into any "gotcha"'s and whatever you pay over to your ex is indeed deductible by you and that the deduction results in a reduction of your taxes which ends up being the equivalent of you never having received the money in the first place. But that is not a given.

"Please confirm with your manager the loan treatment you are proposing."

If you need to season ATA, shouldn't you use a condiment he doesn't have an abundance of?

1. No. The sisters, if the beneficiary designations are valid. 2. Yes, it is called "disclaiming". If the sisters disclaim their entitlement, they don't receive any monies from the plan. 3. Maybe. The benefit goes to the designated individuals (entities, whatever) that are specified in the plan as receiving the benefit in the case where there is no beneficiary. That might be the estate (in which case the will WOULD control), it might not. Check my answers with a lawyer in your jurisdiction.

I've seen service agreements with document providers that seem to require that the Plan Sponsor abandon the document of the service provider (ostensibly by arranging for a suitable replacement or terminating the plan) once the contract between the service provider and the Plan Sponsor is terminated. I question whether such a provision is enforceable. In each case where I have seen it, though, a simple letter to the service provider yields a response indicating that continued use of the document will be allowed, but no responsibility is assumed by the service provider subsequent to a certain date; a result I find quite reasonable.

The rules you have referenced are extremely complicated. It is the client's plan, not the TPA's (or the document provider's). Neither the TPA nor the document provider can prevent a third party from amending the plan. However, the TPA can certainly refrain from offering further services if such an amendment is done and the document provider should no longer be responsible in any manner (assuming they were in the first place) for document maintenance from that point. Once a document is "amended" by a third party, it is certainly an IDP from that point forward. "Amended" means different things for a prototype (even a small substantive amendment) than a volume submitter (a "minor modifier" as classified by the IRS does not result in an IDP). Even if one's plan is technically individually designed, let's say by amending a volume submitter plan in a way that doesn't qualify as a minor modifier, the cycle doesn't necessarily change if put back on a volume or prototype plan by a certain time period. I think you'll find this all laid out in announcements/revenue rulings/revenue procedures issued by the IRS. Document providers hold seminars attempting to communicate the nuances. Many sessions are held at conferences of various organizations each year doing the same. It is not something that can be discussed with any degree of finality on a message board. But I do want to point out one thing: you mention a requirement for a determination letter. No such requirement exists.

Belgarath, point well taken. It is marginally possible that the plan is a combination plan and the amounts shown are the combined premiums and the combined values. Just barely. Also, in this vein (and in this case, I mean a stretched out, almost completely irrational one), it is theoretically possible that the face amount of insurance exceeds the incidental benefit limitations by $100,000. With that tenuous hold on reality I am refraining from deleting VEBAPLAN's almost completely irrational post (proving he did not read or understand the attachment that Rene posted) about the 8886 just so I can point out that anybody who thinks they need to file an 8886 on a plan that does not provide for insurance in excess of $100,000 of the incidental benefit limitations (or circumstances identified in the Listed Transactions rules) is merely trying to spread paranoia. I am, however, tempted to remove the spam portion of his post since Dave is already on record as having asked him not to post historical articles and instead provide a link. If my finger is still itching later in the day I will remove his spam, at least.