Tom Poje

the instructions indicate: Use Form 8955-SSA to report information about separated participants with deferred vested benefits under the plan. Report participants who have a deferred vested benefit under the plan and who: separated from service covered by the plan; were reported as deferred vested participants on another plan's filing if their benefits were transferred (other than in a rollover) to the plan during the covered period; previously were reported under the plan but have been paid out or are no longer entitled to those deferred vested benefits; or previously were reported under the plan but whose information is being corrected. I think the confusion is the language which says: separated participants with deferred vested benefits since someone who has been paid out has no vested benefit you wouldn't think they are inlcuded. you really want to report peopel as a D, because that tells the SSA to delete these off the list. otherwise, someday they will send the people a letter indicating the person might have a benefit. then they will contact you if you are still running the plan and you will have to figure out if they were really paid out, bleh, bleh, bleh. ............. as to whether to include the D folks on the totals page, (line 6 and 7), well if you are filing electronically you have to include them. if it's a paper filing I guess put down for the totals what you feel comfortable. we filed everything electronically, all SSAs for all plans in one big batch.

GMK - it's more than just getting possible better earnings, it's the restoration of the forfeitures. you can't beat an instant return like that. here is the problem I see with the situation (much less whether one can actually do it). suppose she was 20% vested, and had $1000. so she had a $200 distribution and forfeits $800. she returns and via payroll pays back, lest say, only 2.56 weekly and then quits again after x number of weeks.(but also works 1000 hours) so now she is 40% vested. how much of the forfeiture are you going to restore? an additional 20%???

the corresponding DB for nonvested is 1.401(a)(9)-6 Q-6

Not filing an 8955-SSA would simply mean you didn't have anyone to report in that year. (hopefully that is a true fact) That's no different than if you have no distributions and you don't file a Sched R. you don't worry about skipping a year in regards to that attachment do you?

you are missung the Q and As the IRS released http://www.irs.gov/retirement/article/0,,id=238940,00.html in particular, #3 Even though the PY 2010 Form 8955-SSA is available to the public, can I still combine PY 2009 and PY 2010 data on the PY 2009 Form 8955-SSA? Yes, plan administrators can continue to use the PY 2009 form for the combined 2009 and 2010 data even though the 2010 form has been released. As stated in the Instructions to the 2009 Form 8955-SSA, plan administrators may use a PY 2009 form to report information for the 2010 plan year, or combine the information for the 2009 and 2010 plan years on a single PY 2009 form. The release of the 2010 form does not affect this rule. If you file one Form 8955-SSA covering both 2009 and 2010 reportable employees, the 2010 reportable employees are treated as reported in 2009. Enter the beginning and ending date for the 2009 plan year on the Form 8955-SSA when combining information for the 2009 and 2010 plan years. For example, a plan that reports on a calendar year basis and combines information for the 2009 and 2010 plan years should enter January 1, 2009 as the beginning date and December 31, 2009 as the ending date.

Rcline: you no longer have to remember the logi, at least that is my understanding (and at least how FT William works.Once signed up, its there) secondly, depending on the client, you can always 'sign' for them just like you might for other clients. chc93: I think technically even the EZ form is available for inspection, it's simply that it won't be available on the internet. in addition, the instructions you point out were written before this DOL change in policy was announced.

Accroding to the IRS newsletter http://www.irs.gov/pub/irs-tege/epn_2011_9.pdf File Your One-Participant Plans Electronically Using Form 5500-SF; They Are Now Excluded from Online Search Database Beginning January 1, 2012, Form 5500-SF information for “one-participant plans” will not be available to the public on DOL’s website. I guess the questiion is do they mean after that date any SF that is checked one particpant plan is not available, or do they mean begining with 2012 filings.

http://www.dol.gov/ebsa/pdf/2011-5500inst.pdf http://www.plansponsor.com/Advance_Copies_...0_Released.aspx if you scroll down you can print the sample forms from: http://www.dol.gov/ebsa/5500main.html

I would code both as "A" and enter the balance in (g) the normal form is probably lump sum anyway. whether the person elects a lump sum at payout or an annuity, you would still simply code the person as a "D" (If the plan was a DB you would code it as an annuity, but the person could still take a lump sum.)

the whole purpose of the SSA is to drive people crazy... well, ok, the purpose is to indicate terminated employees who are entitled to a benefit or have an account balance. the "A" simply means "Active". so anyone who terminated over a year ago and who has a balance should be coded an "A". An individual that has been paid out (if they were previously coded an "A") should be coded a "D", telling the govt to "Delete" these peope from the record. The same would be true if the person starts receiving an annuity or installment payments. They would be coded a "D" as well. If someone was never coded an "A", you would not code them a "D" if they are paid out. you only report someone as an "A" once, not year after year. that perhaps is a real brief overview

for myself, if the person was hired 9/15/2010, i would have said "What if the plan had a 1 year and max entry dates" in that case the person wouldn't have entered and so I would have treated him as excludable. In your example, I think you use total comp. if the person started deferring 10% on 1/1, it wouldn't make sense to me to count deferrals from 1/1 but only use comp from 10/1 somewhere years ago I tripped across a article that said the original intent in the regs was to have max exclusion of 1 year, and entry dates of first day of plan year and 6 months after that first day (e.g. 1/1 and 7/1) but it came out as first day of plan year or 6 months after meeting the 1 year wait, and this was never changed. who knows if that was really true or not.

I think it has something to do with cats - or at least MEWAs (Multiple Employer Welfare Arrangements) a few snippets of info from: http://www.gpo.gov/fdsys/pkg/FR-2011-12-06.../2011-30919.htm Section 2520.104-20 and the instructions for the Form 5500 and Form 5500-SF provide for exemption from certain reporting and disclosure requirements under Title I of ERISA, including the requirement to file Form 5500 Annual Return/Report, for unfunded, fully insured, or combination unfunded/fully insured welfare plans that cover fewer than 100 participants. Under the proposed amendments to Sec. 2520.103- 1©(2) and Sec. 2520.104-20, and revisions to the instructions for Form 5500 and Form 5500-SF, all plan MEWAs subject to the Form M-1 requirements would be required to file Form 5500 Annual Return/Report, regardless of the plan size. The limited exemption under Sec. 2520.104-20 would be removed for plan MEWAs subject to the Form M-1 requirements. In addition, such plan MEWAs would not be eligible to file the Form 5500-SF. The Form 5500-SF does not include specific Schedule A insurance information, and the Department believes that plan MEWAs subject to this proposal that claim to provide insured benefits should be required to complete the Schedule A so that enforcement officials and the public have information about the insurance policy and insurance company through which the MEWA is providing insurance coverage. Under the Notice of Proposed Rulemaking, content of the annual report under Sec. 2520.103-1 would be amended to require a plan MEWA subject to the Form M-1 requirements to include a proof of compliance with Sec. 2520.101-2 (filing the Form M-1) as part of the Form 5500 Annual Return/Report. Accordingly, the Department is proposing to add a new Part III to the Form 5500, which would ask for information regarding whether an employee welfare benefit plan is a MEWA subject to the Form M-1 requirements, and if so, whether the plan is currently in compliance with the Form M-1 requirements under Sec. 2520.101-2. Plan administrators that indicate the plan is a MEWA subject to the Form M-1 requirements will also be required to enter a Receipt Confirmation Code for the most recent Form M-1 filed with the Department. Failure to answer the Form M-1 compliance questions will result in rejection of the Form 5500 Annual Return/Report as incomplete and civil penalties may be assessed pursuant to ERISA section 502©(2).

GMK: Bah - Humbug. You'll be one of the first houses I hit this year. better yet, I'll get my buddy Santa Robot to pay you a vist.

even amongst IRS officials (at least those I've heard at different conferences) there is some disagreement. some hold if the plan has entry dates specified (e.g. monthly) then those kick in after the otherwise excludedable person has satisfied a 1 year wait. some hold exclude for 1 year and bring in 1/1 or 7/1 (assuming an annual plan) others hold the max exclusion, which is first day of plan year or 6 months after completion of 1 year. they always promised further clarification but I've never heard anything further. I haven't even heard the issue discussed for a few years . not sure how different softwares handle it.

not quite sure where the question is headed. certainly you only have to include comp from date of participation. and if someone switched from union to nonunion, since the tests are separate, you only use comp while union or while nonunion depending on which group you are looking at. and if someone is a member of an excludable division, then they are includable and not benefiting for coverage. if this is an attempt to ay something like Div X is ecluded from participation. in addition, all comp from Div X is excludable. therefore, since the person has no comp I don't use them on a(4) testing because you can't divide by 0, then I think you have problems.

should pay back include deferrals? the old regs , under 1.401(k)-1©(2)(1)(ii) stated "The contributions are disregarded for purposes of applying section 411(a) to other contributions or benefits." [it's nice that I still have that buried in my copy of the regs] the new regs 1.401(k)-1©-1 state they are disregarded for purposes of applying section 411(a)(2). Note the subtle change. the rule now only applies to vesting. so the new thought is that a buy back would have to include deferrals. (see also ERISA Outline Book chapter 4 section VI 2(f)(3)) or as one of my buddy's used to say whenever we played hearts "pay backs are hell" all that being said, I think there are some documents which state you only pay back the accounts subject to vesting. that doesn't necessarily mean the documents are 'correct', we all know sometimes you end up with things which aren't quite correct and eventually the IRS gets things corrected. so I don't really know.

I guess I'm not quite sure what you are asking. before getting to nondiscrim testing, the plan itself must pass coverage. you don't have different rate groups for this portion. so if both HCEs benefit, at least 70% of the NHCEs must receive something as well, if the plan as a whole fails reasonable classification. If you pass that, you can do whatever you want for rate group testing, at least as far as I know. 1.401(a)(4)-2©(3) says a plan passes reasonable classification if ratio % is greater than the midpoint. there is no mention of having to also avoid having people listed by name, etc.

I think you are misunderstanding things. there are 2 tests Coverage (how many people get) and Nondiscrim (How much people get). There is no problem using the classification test for rate group testing. Its the coverage testing that is the issue. If you classify people by name (or something which is basically the same as doing things by name) then you can't use nondiscrimination classification testing to pass coverage. That normally shoudn't be a problem, but I have a boss that sometimes likes to exclude people entirely from the plan to cut costs. (DB/DC Combos) this then becomes a problem if the DC plan has everyone in their own group, even though due to ages the plan passes nondiscrimination testing using rate group testing., because less than 70% actually received something (coverage issue)

of course, the IRS could view any such arrangement as a violation of the intent of the regs, namely using short term employees to benefit a few selected HCEs.

see 1.415-8 combining/aggregating plans - applies only to an employer (or related employers in the case of a controlled group) not all plans an employee might participate in. see further example 1.415-10 of an employee who had 75% benefit in two different DB plans unrelated employers and its not a problem until the companies merged.

I'd ask them if 1.401(a)(9)-2 Q-3 has changed. ...if an employee's DOB is June 30, 1933 the 70th anniverasry is June 30,2003. Such employee turns 70 1/2 on December 30,2003...RBD is April 1, 2004. (I need a new copy if it has changed)

I believe the IRS at different ASPPA Q and A's (and always have to be cautious about such statements because they don't necessarily reflect actual Treasury opinion) has stated that once you put everyone in their own group, then 1.410(b)-4(b) reasonable classification rules kick in "...an enumeration of employees by name or other specific criteria having substantially the same effect as an enumeration by name is not considered a reasonable classification." so basically they are saying"While you can put everyone in their own group, this is not a reasonable classification"

I suppose, in a round about way, EPCRS (Rev Proc 2008-50) Appendix A.03 (Regarding fixing ADP/ACP test late) "...Under this correction method, a plan may not be treated as two separate plans, one covering otherwise excludable...in order to reduce the number of employees eligibile to receive QNECs..." so if you are correcting things late, the answer is NO. but the above implies, at least to me, if done timely, then yes, you can provide QNECs just to the statutory includable. But you still have to follow the terms of the document.

well, I see they released the draft for the EZ, I don't see any changes from last year. someday maybe the DOL will release the form 5500 for next year! http://www.irs.gov/app/picklist/list/draftTaxForms.html a few months ago, according to Janice Wegesin the DOL expects to make the form 5500 available on I-File on or about December 20

well, I am lazy, and if I can avoid running eligibiility on a large plan I try to come up with a way to do. but don't bother me anymore. I must to find a way to stop Christmas from coming. your neighborhood grinch.