BFree

It seems you and your client agree that absent a plan termination, these distributions would be subject to the normal 10% penalty for withdrawal before a certain age. You are looking for confirmation that the 10% excise is waived. It doesn't exist. Tell them to open IRAs and roll the money over.

I understand a partial plan termination to make the benefits accrued up to the termination date nonforfeitable. This is not the same as making someone 100% vested for life. I would look for more confirmation of UKH's position if that is the way you want to go.

We do it. In the 3 firms I have worked at over the past 10 years, ranging from a 15-person shop to a large national firm, it has been done.

Libby - thank you. I think we can agree that there is a risk/return tradeoff, and that this is not a settled area.

Libby, Please let me know why a someone who is not licensed cannot regurgitate historical investment rates of return.

Can you get with the client and cull through the report one time to find exactly which measurements or return info the client desires on the one page sheet? Then, each quarter, take the report and regurgitate the information back to them. Note on the statements that the information was provided by the RIA. I don't see it as an area of expertise question, but as one of 'who does the tedious work?' Why, you do, if you get paid.

Suppose that the Common Collective Trust is not filing as a DFE. I will break out the CCT assets on Schedule H. Most of the CCT assets will be in line 1©14 - insurance company general account (for GICs). Do I need to complete a Schedule A for each component (GIC) of the CCT? Thanks.

No contributions by key employees in 2002 = no TH contribution for 2002 plan year.

You mention that the CD in the plan is of similar size to CDs outside the plan. Have you compared duration or purchase date? For example, a 5-year CD taken out 2 years ago would yield a substantially different rate than a CD taken out today.

How does a 403(B) plan go away, then?

John, Tell us more about exception 3 - fully insured. Are there dc plans that are fully insured? If so, please describe.

Kirk - why do you think this such a recurring issue if it was settled 27 years ago? Because EGTRRA has made the merger of MPP and PSP plans more common? Because the plans are not of the same type (granted, both are dc plans)?

Why would a return of Match result in a revised W-2?

I agree with QDROphile, but most TPAs don't get paid to submit paperwork to non-clients for ex-employees. I think that trying to educate the non-client is a reasonable compromise that will, in the end, benefit all TPAs.

try 401(a)(31)

At last year's ASPA conference the following questions were raised: May a 401(k) plan that would be considered top heavy without regard to (the change to allow SH Match to preclude top-heaviness) provide the safe harbor matching contribution only to employees who are age 21 with one year of service? Would participants who meet the plan's eligibility requirements but who do not have a year of service be required to receive any contribution? Does anyone recall the answer or have any other guidance with respect to the issue? Thanks.

Earl, no determination letter available, but our approved prototype has 100% withholding language for benefits under $5,000.

Check instructions for line 2(g) of Sch. H.

What are the potential consequences for a plan that terminates without the plan sponsor having made some Match contributions that were accrued in prior years? Specifically, the client accrued Match contributions for 2000 and 2001. The client is now bankrupt and the plan administrator will not fund those amounts. Is the 2000 5500 considered incorrect, and if so should it be amended? Is there an issue with participants who were paid based on account balances that included the never-to-be deposited receivables? Multiple Use testing would change. Any other problem areas to be aware of? Thanks.

And many times when a new person is hired into a company, he gets to take charge of the work that no one else wants to do. Seriously, though, you can get a third-party to prepare the form for a fee. Even if a tpa prepares the form, you should become comfortable with it, as your firm will need to sign off on it. Most of the forms are not that difficult to understand.

Actually, I think the moral of this discussion is the opposite of FREE401k's post. Despite your best intentions, you too may be sucked into a lawsuit because of things you can't control.

For those saying that a person not performing services cannot be an employee (and a result cannot contribute to a 401(k) plan): What would be the result for the employer, plan or "employee" if the "employee" deferred into the plan? As an aside, I and several dozen of my co-workers were that "employee" a few years back, laid off from a large actuarial consulting/recordkeeping firm.

Do get a solid opinion of when a top-heavy minimum contribution is accrued. Since all active participants on the last day of the year get one, I'm not so sure why Ben S. refers to a 1,000 hour rule and April or May.

I would propose that vesting for the rehire be guided by the plan document, that vesting does not "attach" itself to a participant in the same way that years of service do. In this case, vesting for the rehire is determined based upon years of service. Vesting for the affected participants account balances at that time is increased to 100% based on the partial plan termination.

What about investment advisory fees? Are they typically an allowable expense? If your plan had say, $175 million in it, and had expenses of $400,000, would you conisder those fees out-of-line with the norm? (I know that much of this depends on the particular facts and circumstances - I'm just looking for opinions). Thanks.