BFree

maybe that's just the time to print it...

I can't find a message from last week asking if SARs are to be given out to former participants who have terminated and been paid out (this from a 401k or pension plan). I don't know if there was a response, but I would appreciate any further guidance on who is a participant for SAR purposes. Thanks.

Regarding - 1.401(k)-1(b)(4)(A)(2) (you can only count deferrals actually deposited within 12 months) and its corresponding 401(m) regulation that is similarly worded - What is the reasoning behind this? If the affected participants are solely HCEs, does this change the way you proceed in a given situation? I see that you must test under 401(a)(4) in the case of deposits after 12 months. Does this preclude you from making a correction to only HCEs? If so, what about the operational failure of not providing the correct Match. Any insight is appreciated.

The 2002 5500 instructions say to file a 5558 with IRS in Ogden, UT.

Defined contribution plans invested in illiquid assets sometimes put a wait on distributions.

See the instructions for Schedule I, they will give conditions about avoiding the small plan audit requirement. Among the conditions is the SAR change. The SAR disclosure requirement "does not apply to...individual account assets (described elsewhere in the instructions)." Your brokerage accounts should fall into this category.

I disagree. Unless there is a problem with the 70-day wait, you sign your paperwork and you get what your balance was at the last valuation. You can't prepare interim valuations forever.

What types of things do you get advised on in an advisory letter?

In one of my cases, the company was no longer in business. Even if it were in business, I would hesitate to attach the phrase "not too difficult" to the situation as a whole. I suggest that the questions "Who pays?" and "How much" and "When" are determined as soon as possible.

Yes, irrespective of your relationship to the plan, it stinks. Long and drawn-out. Enraged participants. DOL onsite, agrees to attach owners' accounts. Fees eating up plan assets. Closure 2.5 - 3 years later.

I don't know if we could have gotten a letter on the document first and then the termination in order to avoid getting the documents from day one. We expect that what we submitted to the follow-up question will suffice.

As a follow-up to a 5310 filing, we were asked to submit the original plan document (from day one) of a plan that has always been on a prototype. I think we tried your suggestion and were not allowed to do it.

mwyatt - no institution is holding the receivable, so I can't see reporting it as being held

Avoid J&S, but need a spousal waiver that is notarized?

CPAs who audit plans we administer have at times contacted participants directly to ask the question.

We received acknowledgement that an application for determination was received in mid-September last year. In April of this year, the agent contacted us with 2 short questions. We expect the letter soon after we respond.

I'd say "Get a new TPA," but you can't do that. They don't work for free.

I am working under the impression that they were subject to the DOL deposit rules. It is a SIMPLE IRA. Question is coming from the accountant, so the deduction year is still part of the question. Looks like it will be: deposits need to be made; will be late; correction method to be determined; 2002 deduction/deferral. Thanks.

I see a lot of posts about the self-employed and the timing of deferral deposits, but not that many about employees. The situation I have is: 2 person plan. 1 is the 100% owner. Contributions were withheld and not remitted for 2002. They still have not been remitted. Can they be remitted? Must (and can?) the custodian accede to the client's request to code these as 2002 deferrals? If they will not be coded as 2002 deferrals, can the client pay them in cash to the participant(s), effectively overriding the deferral election? If the contributions must be deposited and they are not 2002 deferrals, are they post-tax contributions? 2003 deferrals? Any guidance is appreciated.

I have a plan that is currently in the same situation, although not as far along. Plan was audited by the DOL after participant complaints about slow payment. DOL agent indicated to me that the Employer would have to make up the difference (lost earnings). We are not privy to final DOL "suggestions" to the employer, and may never be.

UCA '92 added mandatory 20% withholding for eligibile rollover distributions. Prior to that time, there were different withholding rules. Those old rules still apply for distributions that are not eligible for rollover. I believe that there is not 10% mandatory withholding, but that the participant can elect withholding, with 10% being the default if there is no participant election.

I've had five or six clients file under DFVC, the first in May 2001. None has been audited; no additional penalties.

The DOL has commented that putting accruals on statements, and not clearly labeling them as such, is something that they do not like to see.

what happens if you test on prior year results next year?

The arguments for keeping the single account include lower direct costs with a larger asset base, and inertia. Thanks for the replies.