Mike Preston

There are no on-line calculators for RMD's from DB plans because the final regs require that a participant commence benefits under the plan. Hence, the RMD is plan specific. The regs allow a plan to provide an optional form of benefit to a participant that will closely mimic what the DC minimum would be. It ranges from 102% to about 110% of what the DC minimum would be. But the plan has to offer that optional form within the four corners of the document and the participant has to elect it - it can't just be conjured up by the Plan Administrator in an effort to reduce the otherwise payable RMD. In the absence of this optional form, the DB minimum will sometimes be as much as twice the DC minimum.

You'll need to clarify a few things, I think, because it isn't clear to me what benefits are being provided. In any event, if the plans are aggregated for 410b/401a4, then you count all contributions or benefits other than deferrals and matching contributions in the aggregated analysis. If you want more specific guidance, detail your first post a bit.

Which is why Kareem isn't in my five.

When talking about the best team, don't you want team players? You've just got to eliminate Dr. J. and put Magic in that slot. And Oscar wasn't nearly as accurate as Larry, so I'd have to make that change, too. A team without Michael makes no sense, so one of Kareem or Bill has to go, too, and that would be Kareem, arguably the best "off the bench" player in history.So, my team looks like: Bill Larry Michael Jerry Magic Can you imagine anybody employing a full court press against these guys? Not a chance.

My guess is that Bill would confuse Wilt to no end and find a way, straight up, to shut him down. Kareem was a smarter player than Wilt so he would just smile as he shot over Bill, but I think Bill played a game that was more physical than what Kareem wanted to play, and he would wear him down as well. Bottom line is that Bill is, in my opinion, the smartest of the bunch and physical enough so that, one on one, over a long enough period, Mr. Russell would rule.

Ask for repayment of the minor amount of overage. If the participant won't pay, have the plan sponsor make a restorative payment. Don't do it again.

OK, here we go...... You can't seriously believe that Wilt was better than Bill?

Fourthed?

Bravo!

Jim, I don't know. Just a feeling of being uncomfortable. Just like I'm uncomfortable with plans that charge a specific amount to process a distribution. I know it is done in some quarters. But none of my plans do so and I'm not sure I wouldn't resign if a plan of mine wanted to. Wasn't there some recent guidance from the DOL or IRS on this issue? I have a vague recollection that they said it was perfectly reasonable to allocate only to those who would have a net balance, after allocation of the income and negative allocation of the expense associated with the allocation. Was that in the latest EPCRS Rev. Proc? Did it also talk about the negative allocation of the expense associated with the distribution? In any event, if I really, really had to go down this path I think I would incorporate those factors into the amendment. Admittedly, I have precious few participant distributions that are so small that they would be obliterated with a charge of up to $100, so maybe I'm spoiled.

I don't see an answer to the question as posted. Sure, the question itself goes away if the fiduciaries can be convinced to pony up in some manner. But, assuming you can't, or that you can't in a timely manner with respect to the next reporting cycle, I see nothing wrong with showing the value of a participant's account as negative. It is what it is. If it encourages someone to file suit, well that is the purpose of these disclosures, isn't it? Note that I challenge how a single debt instrument could overwhelm the other assets to the point of creating an overall negative net worth. I'd like to see how that came about. As others have stated, on its face, that sure does argue for some sort of fiduciary violation. But it might also argue for the fact that the OP is just confused about the overall value.

As I've mentioned in another thread today, the IRS seems to be avoiding all questions related to 404 because there are no regulations, post-PPA. Yes, the includible contribution issue has been brought up. Nobody will say, even off the record, that it is likely the same rules will apply post-PPA. Amazing, at this point.

It is pitiful, I know, but if you can believe it, this is one of the great unanswered questions since the law was passed nearly 4 years ago. The IRS refuses to answer the question ostensibly waiting for the 404 regs to be published, which will theoretically answer it once and for all. If you talk, off the record, with some of the more reasonable people at the IRS, you will get a positive response (that is: the higher amount will be deductible). The problem comes about in the first year of a plan where there is no cushion at all and the minimum as of the valuation date is also the maximum. In that circumstance a contribution not made until 1/1/2010 will be higher than the required minimum by one year's interest. Even in that circumstance we can't get the IRS to formally agree that the higher amount will be deductible. Amazing. Until the regs are issued, I think it is a very reasonable interpretation of the statute that the higher amount is deductible. But I'm forced to tell my clients that there is a risk.

Just a guess, but it probably happened to everybody.

Ooooooh, good point. But it flies in the face of reasonability to run into a plan that charges for this stuff but won't provide a copy of the QDRO procedures immediately. It does bring up the issue, though, and the response to that issue is to get a copy of the plan's SPD where the charges, if any, should be laid out.

Might want to clean up that language a bit. Sounds like you have just established a minimum required gain/loss allocation for prior participants of $25 per valuation. I know that isn't your intent. With that said, I'm not comfortable with the intent of the language, so I don't have any suggestions on how it should be worded.

As a general rule, we drop the dual referencing of effective dates when the general effective date of the restatement is after the latest special effective date.

The fact that this is a governmental plan makes it less familiar territory than if it were subject to all of ERISA. But this seems to me to be a variation on the old 410(a) issue dealing with part time workers. If you look at the 410(a) regulations I think you will find that the IRS takes the position that a "strange" definition for eligibility will be considered non-compliant, even if the resulting group of participants satisfies 410(b), if the "strange" definition keeps people out of the plan who would otherwise have qualified for the plan had the plan used a "normal" definition of eligibility. So, the question back at you is: is it possible that anybody would be excluded now who would not be excluded if the plan used a statutory definition for eligibility? If not, and the only thing going on here is that a less restrictive definition is in place, I wouldn't worry about it. Now, there are some who believe that the specific regulation mentioned is no longer looked at by IRS personnel as applicable; or that it was contrary to so many other provisions in the code that it isn't enforceable, anyway. Dangerous territory, that, but understandable. If, when you get done, you have it reviewed by outside counsel, nobody should blame you.

This explains why they can't do any calculations. All they know is the opening account balance. They don't have the historical information from the other plan. Perfectly reasonable. I have a slightly different take on this, I think. By refusing to provide you with written information, the plan has let you know that they intend to make this process less than transparent for you. I think you should therefore not feel bad in the slightest about protecting yourself. By all means send along a copy of your settlement agreement and tell them that you are submitting it to them for their determination as to whether it satisfies the plan's definition of a qualified domestic relations order. At that same time, make a formal, written request for a written copy of the QDRO procedures. You will hopefully be provided with a document that tells you how long you have to cure a deficient DRO. My guess is that it may be as long as 18 months. I would expect that you will receive the QDRO procedures shortly before you receive a formal rejection of the DRO as a QDRO. At that point, armed with the QDRO procedures, you will know the timeframe during which you must submit an acceptable DRO. In the meantime, now that you know you absolutely must prepare a DRO that references a specific dollar amount, or a specific percentage of the amount that the plan initially received on behalf of the participant from the prior plan with gains/losses since the date of deposit, you can proceed to have that drafted, agreed and signed by the court. Good luck.

1) What you say you know is not true. Under post-PPA rules, there are no "carryovers" as you describe. Unless or until the IRS issues regulations similar in concept to what applied in the pre-PPA period the old "carryover" rule (which is technically referred to as the "includible contribution" rule) doesn't really apply. 2) If a contribution is made in 2009 and deducted on the 2009 return, it is subject to the 404 rules for 2009. The fact that the contribution is also credited to 2008 for 430 purposes seems to be somewhat irrelevant under post-PPA rules. Normally, this is not a problem, since the deductible amounts are typically quite high under poss-PPA rules.

Nobody will come out and say it, but there just has to be some practical reality sprinkled around at times. This is one of those times. Does it technically disqualify the plan? Yes. If you want belt and suspenders, go through the motions for the 16 cents. But if it isn't part of a continuing pattern, and you have advised the client that the technical requirement is to refund the excess, I wouldn't quibble with a decision by the plan sponsor to ignore it.

Some POA's require that the maker be incapacitated. Some do not. Some state laws override the specific language in the POA. My guess is that ERISA pre-emption wouldn't apply in this case and therefore the state with jurisdiction holds sway over the decision. If in doubt, I would say that you would want to check with counsel of course. In my experience, many financial institutions believe that notwithstanding what the law of a particular state says and notwithstanding what a specific POA says, they hold to the opinion that it is their exclusive right to allow or not allow a POA to exercise authority. That is, they treat the POA only as a suggestion. When pressed, they will say that if something is that critical then they want to see guardianship appointed by the courts. For those of us who have agreed to an appointment as POA and undertake the sometimes significant effort of assisting someone who is elderly in managing their affairs, it is a frustrating road. So, I would say, whatever you decide to do, please be kind to this individual who is, I would hope, trying to just do the right thing by the maker.

This is probably an over-cautious comment, but be sure that the plan in question isn't somehow subject to top-heavy. Having an NHCE Key employee in the plan might do it, as would this plan being part of a required aggregation group with another plan where the combined plans are top-heavy.

Combined

You mean like this? Cavaliere almost had it right. You do want to copy from notepad, but you first want to create the "code" formatting tags by clicking on the "Wrap in code tags" icon above the reply window, then paste between those tags what you have in notepad. It still won't look right on the screen where you paste it unless the font you are using is a fixed spaced font. But it *WILL* look right once you select Post Preview because when it displays the actual posted information, the CODE tags use a fixed space font. To wit: Name Comp Hire BenefitHolmes, S. 1,000,000 1/1/1845 BigWatson, J. 10,000 1/1/1855 Small