Zorro1k
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Merger of two safe-harbor plans, different formulae
Zorro1k replied to Zorro1k's topic in Mergers and Acquisitions
Well, Zorro, as I understand it, employees from Company A will become participants in the plan of Company B after the merger. If that is the case, you can treat a SH plan as terminating and preserve SH status for certain business transactions (including mergers and acquisitions). You can also merge a terminated plan into an existing plan. Therefore, you can terminate Company A's plan, preserve the SH because of the merger, and then Company B's plan operates with the new participants effective as of the date of the merger. -
Plan with a 3% non-elective SH wants to merge with safe-harbor plan with basic SH match. Under IRS guidance re: mid-year amendments to SH plan, you can't change the SH type mid year. Can these plans merge? Does their merger mean the plan will lose SH status for 2016 year and be subject to testing?
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The plan does not allow in-service withdrawals at any time. The plan does allow in-plan Roth rollovers. The plan also allows distribution from in-plan Roth rollover accounts at any time. The plan would like to change that so the in-service distribution options for the in-plan Roth rollover account are the same as the rest of the plan (withdrawals from rollover accounts are not permitted at any time). Is the distribution from in-Plan Roth rollover accounts a protected benefit? Can it be completely eliminated so that the in-plan Roth distributions are the same as the in-service distributions?
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Plan admin has documents identifying husband of participant as POA. Husband submits notarized application for benefit. He signs "her name by his name" but doesn't indicate "POA" or "attorney in fact." Is it OK to accept this notarized signature and process the application for benefits?
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What if they are trying to close a plan year in progress? I understand it is ill-advised but is it prohibited? I can't find anything that precludes the possibility.
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Employer with FSA wants to amend their plan year to match the insurance coverage year. This would result in a short plan year. What implications does this have for participant salary reduction elections? Should the election be pro-rated to match the short year? Should salary reductions be decreased? Thoughts?
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Thanks. I think the orphan plan correction route or contacting the DOL abandon plan project is the way to go.
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Individual receiving benefits from plan is the only remaining participant in plan. Plan sponsor is no longer around. Advisor wants to know if plan needs to be restated for PPA. If not, why? If so, how should they go about restating?
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If a plan provides for actuarial increases after 70.5 and also provides for continued accruals but does not provide a "better of" calculation, can PA make administrative decision to do "better of" calculation for benefits?
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436 model amendment
Zorro1k replied to Zorro1k's topic in Defined Benefit Plans, Including Cash Balance
Thanks for the reply. The inquiry said to remove incorp. by reference. I'm thinking that means defining in the document (rather than simply removing) but I don't know what language to use because the definitions are spelled out in section (j). -
We used the 436 IRS model amendment for a client. That client filed a determination letter upon terminating the plan. The IRS sent an inquiry asking for the amendment that was adopted to be amended to remove the incorporation by reference to the definitions in Sections 1.436-1(j)(1-9). I looked at that section and there is no explained definition. Where can I find that?
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When a benefit statement is requested and not otherwise required by law, can the plan charge the participant and, if so, is it limited to the reasonable charges of other requests of .25/page?
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A state wants to provide a health FSA for employees. State law requires that the state cannot pay for it and that all admin fees must be passed on to employees. What is the tax-treatment of the costs that are passed onto the employees?
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For a due date on an IRS inquiry, is that satisfied by mailing an item on the date or does it need to be received by the IRS by the response date? Can you tell me your support for this?
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QDROs and 72(m)(10)
Zorro1k replied to ERISA-Bubs's topic in Qualified Domestic Relations Orders (QDROs)
I believe that the court has the discretion to approve a QDRO that gives the AP money exclusively from the Roth portion of the account.