Mike Preston

PS. Have you run out of lawyer pixie dust? I'm still waiting for a citation of a case where ERISA benefits are lawfully denied to those working illegally.

mjb, it is your posts that are irrelevant. Certainly not austin's. The OP is, as far as I can tell, the third party administrator. Not the employer. It is not the third party administrator's job to police the plan sponsor for compliance with employment related laws, such as whatever the current flavor of immigration rules might be. You can expand this list to things like collective bargaining, davis-bacon, etc. That is the plan sponsor's responsibility. The third part administrator is not in any way abetting a plan sponsor's decisions to violate laws if their system allows for the crediting of benefits to those who are employed by the company. Period. It is quite the contrary. The only role of the third party administrator is to identify the benefits provided under the terms of the plan and to enable those benefits. ERISA requires nothing less. Your posts are completely off topic because they are revolving around advice a labor lawyer would provide to an employer, not advice that ERISA counsel would render to a plan sponsor.

You won't find anything in my post indicating that they have an obligation of any sort to continue the employer/employee relationship. Certainly, if an employer has the right, or even the obligation under law, to fire the employee then counsel will no doubt advise the employer to do just that. However, from an employee benefit perspective, all I'm saying is that it doesn't matter one whit whether the employer/employee relationship is in violation of the immigration rules. If an individual is entitled to benefits under a plan, then the legal or illegal status of that individual is irrelevant. Give them the benefits they are entitled to or risk your plan's qualified status.

Indeed they should. And they would. Suffice it to say that we have a difference of opinion. You might want to check with your friendly IRS auditor, though. They will quickly disqualify a plan for failure to include a worker, legal or not. There is a public policy issue you have ignored. In no way shape or form does the law seek to advantage an employer over an employee the way you postulate. There is already an unfair relationship (balanced by various and sundry laws attempting to, er, balance the scales). If you are correct, I'm sure you can use your lawyer-magic to find some cases where there were illegals who were treated the way you describe. Good luck.

All of the above are irrelevant. Thw workers must be included whether they are legal or not, whether they have filled out I-9's or not, whether they completely W-4 or not, whether the recordkeeper's system is hopelessly outdated as to require a SSN and whether or not the law passes. Me thinks the OP *IS* the recordkeeper and just has never run across this issue before.

I think you need to look to your document provisions to see what happens. While the steps you outline are permissable, they are not the only options available.

Let's see, how does that go? Oh, yeah: "I'll be Beethoven". Or something like that.

The question is: Do you feel lucky?

Times, they are a changin'.

Who's to say you aren't paranoid? They are, after all, after you.

Since I presume you mean that the document called for 3%, but the individual received 8% and it looks to me that you are beyond the self-correction period. So it seems to me that there is very little choice but to file.

204(h) Notice not required if 1-person plan covers the owner.

Ambiguous. Numeric example, please.

Stay tuned. Rumor has it that we will be receiving partial and perhaps temporary guidance in droves over the next 8 weeks. I think this issue is addressed. My guess is that we will not like what is written. "riduculous"? Won't be the first time. It appears that there will be a great need for comment letters in response to the many issues that will be thrown at us. Please, please, please volunteer with your respective organizations (ASPPA, COPA, AAA, etc.) to help with this effort. It is likely to be overwhelming.

I think this issue was directly addressed by Jim Holland at the COPA conference this last weekend. My understanding of what he said is that the IRS would not force one to set up two plans to accomplish a proper offset and satisfy 401(a)(26). That, to me, makes it clear that a partial offset is allowable. Have fun tracking everything, of course. Hopefully, he'll be asked the same question at the ASPPA Annual conference and answer it the same way.

Amazing the rationalizations, if you ask me. This whole thing falls apart the first time the participant finds themself in a position to arbitrage your risk, and the plan loses. All I know is that I wouldn't want to be the one who designed it. I suppose there might be a circumstance where it would make sense. I haven't heard it, yet, though. And, no, getting lucky (even for a long period of time) or having participants who are not capable of understanding the issue (even for a long period of time) is just not enough.

You are kidding, right? You really have an offset plan where the offset is invested in a daily valued environment? Unless it is a very small offset, the logic of having the participants able to invest monies used as an offset escapes me.

My condolences to his family and friends.

MaryMac, can we get you to record a message, as a plan sponsor, that we can play to our clients who don't share your enthusiasm for doing things correctly? As already stated, if only everyone..... In any event, if a DOL auditor attempted to claim that your one day delay was a PT I would hope the auditor would: 1) be quickly overruled by his/her supervisor 2) find another job.

I believe the answer is yes, but you really should submit a letter of determination application to ensure your client is protected should the IRS come out with yet another strange interpretation.

I usually find that the life-partner plan is better still.

The general consensus is that you use the pre-, I believe.

The plan must allow for the rollover of non-spousal monies. In a plan termination, the IRS will allow adding this provision after the termination date, although I think it would be better practice to add it before or coincident with the termination itself. There are some documents where the pre-PPA language could be read to enable such non-spousal rollovers without the need for an amendment. But, if the plan allows it, then it should be something you can get done.

Could it be the reduction to account for the fact that the recipient is younger than the participant? I wouldn't call that the "survivor annuity reduction factor", but I guess I can understand why someone might.

Just curious, mjb, but how, exactly, is your response even remotely related to the issue being discussed?