justanotheradmin

Person B's input isn't required, in fact some divorce agreements will specifically make drafting and filing a DRO the responsibility of a particular party so that the other party doesn't have to deal with it. The plan literally CANNOT make a DRO qualified until AFTER its been filed with the court. So either these are wrong, or out of order. Person B's signature is not required keep track in writing or every written request and response for the information. This is something to hope EBSA can help with. I don't know what this means. Are they asking Person B to sign something? asking them to take money out of the plan? There isn't anything for an alternate payee to accept or reject. If they think the DRO was written wrong that is typically something for them and their lawyer to work out with the other person's lawyer. Not the plan. I don't think this means what you think it means. for a DRO to be qualified - it literally just means that it has the appropriate information mandated by federal law, such as being able to identify the people involved, the plan involved, that the award isn't in a form that the plan doesn't allow etc. Qualified doesn't mean the order has a money split that is the same as what the parties agreed upon.

I think you might be conflating "legally qualified" and "aligns with an equitable agreed upon division of marital property" . they are Not the same. Legally qualified for a DRO - is just a checklist based on the rules in Federal Law. Has almost nothing to do with the amount, value, formula of the benefit awarded written into a DRO for the alternate payee. Q: Does person B have a copy of the DRO? It not, perhaps they can get one from the court records. If yes - Q: is the Plan Administrator saying the DRO is Qualified? Was that communicated in writing from the Plan Administrator to person B? The DRO is not a QDRO until the plan says it is. And then the plan is required to provide person B with all the things - the QDRO procedures, the acceptance of the plan that it is qualified, information about segregation of the money into a separate account, or distribution options, etc. If the plan administrator is not providing those things, then person B can ask EBSA to help. If the plan administrator is refusing the say if the DRO is qualified or not - and person B wants it to be qualified - then person B needs to submit the DRO to the plan and ask them to deny it or qualify it. In writing. Q: Does Person B believe the benefit awarded in the DRO is NOT what was agreed to in the property settlement agreement? If they think the DRO is drafted wrong, and doesn't align with the agreed upon split of marital assets - then it is something for a family law attorney to work on. The Plan Administrator has no say in the formula or benefit award in a DRO, qualified or not. Person B should take a copy of the DRO and a copy of their marital property agreement to a family law attorney and ask them to see if the two align. If the issue is the Marital Property agreement should be amended - then that has nothing to do with the plan either.

can they not log in to a custodian or plan website and see balances?

that depends. by current participants do you mean people with balances? actives with balance? terminated people with balances? actives who are eligible but do not have a balance? if the MEP is relying on the individual employers to send them a census each year, they might not know who the current participant are, just who has balances and who was current as of the most recent year end. If the MEP is also the recordkeeper/custodian/and 3(16) provider it will vary.

100% this something that an experienced ERISA law firm should handle. This is NOT the type of VCP to cut your teeth on, even if you as a TPA want to start offering VCP services and have staff with the proper enrollment (CPA, ERPA, ETC) to do so.

All of that needs to be sorted with a family law/ divorce lawyer first. If the divorce lawyer needs help from an ERISA attorney should know that they don't know enough and suggest additional counsel. Once an agreed upon DRO is written - that conforms to whatever the property agreement (original or updated etc) has in it - if there are issues getting the money out of the account for Person B - THEN the plan gets involved. Is the split in the property settlement agreement appropriate given all the new information? - not a question for these boards or the plan Does the DRO reflect the 401(k) award amount/value in the property settlement agreement ? - not a question for these boards or the plan, get an attorney or accountant who specialize in that to review Is the DRO accepted as qualified by the Plan? - that's a question for the Plan Administrator. If Person B doesn't like the answer, or isn't getting a response, they need to request a copy of the QDRO policy If person B wants to contact EBSA - they certainly could. None of the background information matters to EBSA. They would need to tell EBSA the date they presented the DRO to the plan, or the date the plan was notified there might be a QDRO, the date they requested a copy of the plan's QDRO policy in writing, and then any communication they received from the plan in response either saying no, we aren't giving you a copy, or you aren't entitled to it etc. If a participant/beneficiary is entitled to a plan disclosure, document, SPD etc, and they requested it and haven't received it, then I've seen good success when EBSA contacts the sponsor / plan admin to get it. and then EBSA forwards it on to that person. The QDRO procedure isn't going to tell person B if the stuff in the DRO is correct in regards to the dates, values, etc. Its going to say what the plan will do, notices, etc if a DRO is presented for the plan to accept as qualified or deny it as not. If the property settlement awarded half the 401(k) to person B, as of that date, then the DRO might be fine. Sounds like Person B might have wanted marital assets split differently if they knew the full picture, include a different portion of the 401(k). All that needs to be ironed out first.

you haven't said what the actual issue is - has Person B received money and they disagree with the amount? They don't like how the DRO was drafted? Are you saying the DRO was never signed or reviewed by Person B or their legal representative? If they have a copy of the DRO - and it is doesn't agree with their property settlement agreement - that needs to be addressed. The plan doesn't get involved with that, and the plan's QDRO procedures don't matter for that part. Bottom line - if there is an issue with the language in the DRO - specifically the asset value award - that probably has nothing to do with the plan's QDRO policy. You haven't said where the money is held either. If it is someplace like American Funds, or Hancock, etc when the distribution / segregation of accounts form is submitted they will often do the calculation for the plan administrator. You ask what legal action can be taken - What issue is it that Person B would want a remedy that the PLAN has anything to do with? Failure to receive a copy of the QDRO procedure? Failure of the Plan Administrator to correctly apply the asset valuation / award that was specified in the DRO? - then that's a math problem. See my earlier reply for suggested steps. If the issue is the DRO has the wrong amount(date) in the order, that's not a Plan problem, that's something they need to take up with whoever is helping them with the assets in the divorce. Either what you are wanting help on - has nothing to do with the plan - and is out of scope of these message boards - or, you haven't given the information needed to make it clear to the folks reading that there is an issue with the plan.

When a DRO is signed - and the asset valuation date (via date or otherwise) are two different things. The DRO might say the alternate payee gets 65% of the vested benefit as of November 17, 2019, with adjustments for earnings thereafter, but the actual DRO might be signed and recorded with the court years later. And the actual split of the money might be well after that. TL:DR Present the DRO - ask for copies of the QDRO policy and ETA on decision - get decision - get forms to get money out. Person B can perhaps start by giving a copy of the DRO that was filed with the court to the Plan Administrator (this person, can be an entity, business is usually listed in the SPD). If it is the EMPLOYER it is helpful if it is going to someone whose responsibilities include the retirement plan. Person B might want to include a cover letter with the DRO - asking for a copy of the plan's QDRO procedures/policy, and confirmation that the DRO has been received by the Plan Administrator and that it will be reviewed. Ask for an ETA on when the DRO will be accepted as Qualified, or rejected. And include where the written acceptance or rejection should be sent to notify the alternate payee. Keep notes - and dates - and copies of correspondence. When the ETA passes - and no Acceptance or Rejection is received in writing - ask for an update, in writing. If DRO is accepted as Qualified - the Plan Administrator(or perhaps a recordkeeper) calculates how much the current account belongs to the alternate payee, and the segregates or tracks it separately. Then the alternate payee asks for a distribution form, and can do whatever the plan allows with the money, often rolling it out into their own IRA. If the alternate payee disagrees with the amount that was segregated - then they can ask for supporting documentation, such as statements or what formula was used to arrive at the split amount. How much detail they receive will vary a lot based on a variety of factors. You do not mention where the plan's money is held. None of this is legal advice. Just a simplification of what to actually focus if someone wants to get the plan to review a DRO.

I agree with C.B. Zeller. Is the issue the file type? Because ASC takes .txt files for import just fine. Is the issue how the data is in the file? What import function in ASC are you trying to use? there are a variety of ways to import things into ASC. For example, investment imports where ASC has pre-programmed to work with certain major recordkeeper files. And then there are ASCRIPT custom imports which are super easy to use as well once you know what you are doing. Plus wizards and such. If the issue is how the data is in the file, and you don't want to manually edit the file then a macro or code to do that as CB suggests. You can just open the txt file in Excel, and then save it as an excel file type if you really just want to change the file type.

I think the auditors are probably right. you need to look at the formula of the match - if it is on an annual basis - and everyone is to receive a uniform percentage of pay based on deferrals - which is typical - why would someone who enters 4/1 or later be excluded? discretionary does not mean it can start stop any time - it usually means they can choose to give it one year or not. If they give it for that plan year, it needs to follow the formula in the document. Which sounds like is based on annual compensation and annual deferrals. If you let us know specifically what the document says for the annual based match formula maybe people can give more insight. If the sponsor wanted the ability to contribute match for some paydates and not others, the formula for the match needed to specify a payroll period or paydate basis. Not Annual.

Everyone has made excellent points. Even if allowed(very doubtful) - consider the additional expenses of a periodic independent appraisal for valuation to report correct as a plan asset, as well as the expense of an ERISA bond covering a non-qualifying asset. Is the plan or employer willing to pay those expenses?

In addition to the issues mentioned by @C. B. Zeller, (the control group / affiliated service group / related employer group issue is so common!) some what I see: Disregard for deposit timing, both for deferrals, and Over contributions thinking it can count towards a future year even though the deposit occurs this year. - think throwing in an extra $100,000 because they have the cash available and want it to grow As well as disregard for limits, such as depositing up to what they think is the maximum, even though the W-2 compensation they have paid themselves(or a covered spouse) is substantially lower. Investments in unusual assets with no additional compliance such as an independent appraisal for valuation Assets/accounts titled to the business rather than the plan name when they were intended to be for the plan Starting more than one plan every time they get a new account or advisor. Or thinking they have more than one plan when really a new doc with a new account might be a restatement of the older document, but they don't realize it Compensation not being eligible - thinking that profit and loss is enough, and not having earned income, but still making contributions Failure to make any contributions - for 5, 10+ years(sometimes nothing beyond the first year) at that point the plan isn't really a plan and should be terminated and closed

Is this allowed? and if yes, does it have to be written into the plan document? offhand I don't know the answer to your first question. I suspect there is something about definitely determinable as of the last day of the plan year, but I am unsure, but I suspect it is allowed, based on my answer to the second question. Does it need to be written into the plan document at all? If the plan uses a "everyone in their own group" method of allocating the employer contribution, and testing passes, why would an allocation condition need to be written into the plan document at all? An employer could decide "everyone who wears blue shoes in November" gets an employer contribution this year, and the plan's TPA, recordkeeper, etc might never know that is the reason why some people got a contribution that year and not others, even if the TPA was the one who performed the testing. When the allocation groups are not a safe harbor classification - full testing has to pass anyways. So use whatever criteria or allocation restrictions the client wants and as long as it passes I would think its okay.

Super helpful, thank you @Peter Gulia!

TPA for a small PBGC covered plan, with various HCE and NHCE A portion of the plan's money has been transferred to what appears to be a pooled off-shore account with a wealth management firm. No annual statements are produced, just a letter that says something like your starting interest as of 12/31/2024 is $X, P/L during the year was $Y, and end value of your interest in the pooled investment is $Z. The letter explains that statements are not available due to the pooled nature of the investment with lots of other investors. Off-hand I do not see anything prohibiting a pooled investment interest that would impact either an ERISA bond (non-qualified assets), or filing of a Form 5500-SF (must be eligible plan assets). Is there one? Other potential restrictions that should be asked about? There really isn't enough information to go on, so right now the goal is to make a list of questions for the sponsor and the wealth management company to address. So far: I intend to ask which is the categories of "qualifying plan assets" the investment is, in case the bond is not sufficient to avoid audit. What other questions /issues should be addressed? I feel like there are things we should ask about that I just don't even have an inkling about. Not a producing TPA, do not get involved in investment discussions, other than what is necessary for compliance, testing, reporting etc. Thank you all in advance for your insight.