Tom Poje

if a plan fails to provide a top heavy minimum it is correctable under SCP, so I'd hold it's logical to conclude a corrective contribution to an individual for another reason (e.g. person was simply missed) could end up counting toward top heavy (assuming of course you are talking the same plan year - e.g a correction was made for 2008 and that will also count toward 2008 top heavy as well.)

many many many moons ago this was one suggestion from Reish & Luftman (note this goes back to 1997!, the early days of the self correction program, but I don't believe te reasoning behind it has changed) http://benefitslink.com/qa_columns/plan_de...archive/41.html Q&A 41 Correcting Plan Defects Q&A Correcting Improper Return of Excess Contributions (Part 4) QUESTION 41: In Q&As 38, 39 and 40, we have discussed the following reader question: "A 401(k) plan failed the ADP test in 1994, and excess contributions were distributed in 1995 to some of the participants believed to be highly compensated employees (HCEs). However, the prior administrator incorrectly determined the HCEs, so that the wrong amounts were distributed to the wrong people. The plan has 19 HCEs and 188 non-HCEs. The plan paid corrective distributions to six of the HCEs, which were larger than they should have received, and to two non-HCEs. Three HCEs who should have received distributions did not. How can we correct these problems?" ANSWER: There are three qualification defects in this situation: the ADP failure in 1994; the excessive distribution to six HCEs in 1995; and the impermissible distributions to the non-HCEs in 1995. (While it is possible to fail the ADP test and only disqualify the CODA--cash or deferred arrangement--part of the plan, we have assumed for these purposes that the plan itself would be disqualified as a result of the ADP failure.) In this response, we will discuss the corrections for the improper distributions. In Q&A 42, we will describe the corrections for the ADP failure. To correct the excessive distributions to the HCEs, the plan administrator would need to request that the participants return the excess amounts to restore their account balances. However, in the past, the IRS has not required that plans undertake significant efforts to collect incorrect distribution amounts. We understand that the IRS may be reevaluating the degree of effort the plan is required to expend where the participants are HCEs and the improper distributions are large. In addition, the IRS could, in a VCR application, disqualify the individual accounts of HCEs who refused to return the excess distributions. The form of correction for the distributions to the non-HCEs would be the same, i.e., request the return of the amounts improperly distributed. Again, it is unlikely that the IRS would require significant efforts to collect these amounts. If the participants fail to return the excess distributions to the HCEs and/or the improper distributions to the non-HCEs, would the employer be required to contribute that amount to the participants' accounts? While correction often requires the employer to put more money into the plan, this is one instance in which the IRS does not require it. If the employer did so, the participant would get a windfall. The current IRS view is that the employer is not required to give a windfall to the participants in order to correct excess distributions. © 1997, Reish Luftman McDaniel & Reicher, a Professional Corporation. --------------------------------------------------------------------------------

the DOL website to view forms is http://www.efast.dol.gov/portal/app/dissem...?execution=e1s1 once filed in 2009, you can view the forms within minutes

From the IRS Employee Plans News The Employee Plans News is a periodic IRS newsletter with retirement plan information for retirement plan practitioners. Special Edition - July 2010 Beginning with returns for the 2009 plan year, the Schedule SSA (Form 5500) has been eliminated as a schedule of the Form 5500 annual return/report and is replaced with Form 8955-SSA. Plan administrators must file this new form with the IRS and not through the EFAST2 filing system. Plan administrators are not required to file the Form 8955-SSA for the 2009 plan year and subsequent years until guidance is issued by the IRS. The IRS anticipates the guidance will establish a special due date, expected to occur in 2011, for the 2009 Form 8955-SSA. After the Form 8955-SSA and related instructions are available for filing, plan administrators should expect to have a reasonable amount of time to complete and file the form by the special due date. The information reported on the new form will be similar to the information previously required for Schedule SSA. Caution: The special due date for Form 8955-SSA will not affect the time for filing the applicable Form 5500 or Form 5500-SF for the 2009 plan year through EFAST2.

the IRS has provided only 2 situations that a safe harbor plan can be amended (that I know of) 1. adding a Roth feature 2. amending hardships for funeral expenses they keep promises to offer other possibilities, but in the abscence of any guyidance, I would be wary of amending plans during the year for other situations

but I do think the Red Wings hit harder than the Lions....

Sieve- my comments about you wearing a mask weren't meant to imply you were a wimp on the ice. rather, being from Detroit I assumed you wore a mask because of the "ions" (that team that gets the "L" kicked out of them all the time.)

I'd go by what is found in 1.401(a)(9)-7 Q & A 1 If an amount is distributed by one plan and rolled to another plan, is the RMD under the distribution plan affected by the rollover? No......... please note this reg references 1.402©-2 Q and A 2 which then defines plan as being a qualified plan or "an individual retirement account or annuity." so if you are in the minority ask them how to interpret these reg cites.

Andy Andy Andy. shows how much you know about hockey. Sieve is a wimp compared to some of the other goalies. gotta love Gump Worsley, not just for the name. Worsley was known for his wry sense of humour and various eccentricities. Early in his career with the Rangers, when he was regularly facing 40–50 shots a night, he was asked "Which team gives you the most trouble?" His reply - "The New York Rangers." Accused by Rangers' coach Phil Watson of having a beer belly, he replied, "Just goes to show you what he knows. I only drink Johnnie Walker Red." He was also vehemently opposed to wearing a mask. Worsley was the second-to-last professional hockey goaltender to play without a mask - Andy Brown of the Indianapolis Racers being the final one the following season - wearing one only in the last six games of his career. Asked about why he chose to go without, he told reporters, "My face is my mask." here's a guy who would face flying pucks without a mask and yet: Worsley was also well known for his fear of flying. He suffered a nervous breakdown in the 1968–69 season after a rough flight from Montreal's Dorval Airport to Chicago on November 25 en route to Los Angeles, and received psychiatric treatment and missed action as a result. It is said that when he came out of retirement to play for the North Stars he was assured that, as Minnesota was in the central part of the continent, the team traveled less than any other in the league. Injuries a shot from Bobby Hull in 1961 that hit him in the forehead - The blast to the forehead from Bobby Hull landed him, unconscious, in Montreal's Royal Victoria Hospital. Upon awakening, he was asked how he was feeling and replied, "Good thing the puck hit me flat!"[

the Q and A only says you don't need to attach the 5558, so I would take that to mean its not a problem if you do. in other words, I read that to say 'its optional'

ft william carried the following notice the last few days: The DOL EFAST2 Submission system will be unavailable on Thursday, July 1, 2010 from 3:00AM until 5:00AM EDT (2hrs) so perhaps the DOL is working on some adjustments

the DOL knows Q26: If I am filing for an extension of time based on a request for an extension submitted on Form 5558 with the Internal Revenue Service, do I need to attach a copy of the Form 5558 to my Form 5500 or Form 5500-SF? You do not need to attach a copy of the Form 5558 that was filed with the Internal Revenue Service to the annual return/report in EFAST2. You must, however, keep a copy of the Form 5558 that was filed with the Internal Revenue Service with the plan’s records. this is just one of the common questions they have answered at http://www.dol.gov/ebsa/faqs/faq-EFAST2.html note: as for the form 5500 EZ, well, this only references efile2, so....

I don't have the instructions for the 2008 ez, but the 2007 says you mail the EZ to the DOL (EBSA address) my guess is 2008 would be the same

Moe: I see the DOL website now contains the filing blurb The EFAST2 electronic filing system allows the plan administrator to authorize a practitioner/service provider to submit the plan’s Form 5500 or Form 5500-SF. If this e-signature option was used, the name of the practitioner/service provider whose electronic signature was applied to the Form 5500 or Form 5500-SF will appear on the image of the form in the signature area above the text “Signature of plan administrator.” The practitioner is not necessarily the plan administrator responsible for the filing.

If it helps, the gateway language (assuming its properly worded) is intended to work in a somewhat similar way as top heavy language works

haven't had a problem, in fact have file more froms earlier this year than in previous years. (Though perhaps have been lucky becasue we switched to a different software and haven't had any real problems. so, what can I say but the following: I do not like them, Sam-I-do. I do not like e- file 2. Would you like them Here or there? I would not like them here or there. I would not like them anywhere. I do not like e file 2. I do not like them, Sam-I-do Would you like them in a house? Would you like them with a mouse? I do not like them in a house. I can not figure out this mouse. I do not like them here or there. I do not like them anywhere. I do not like e file 2 to file them is like a zoo. Would you file with D-O-L? no - the whole process is living hell! Not in a box. Not with a fox. Not in a house. Not with a mouse. I can not file here or there. the problem lies with the software!!! I do not like e-file 2. and yet the forms will soon be due. Would you? Could you? in a car? After failed attempts I hit the bar. I would not , could not, in a car You may like them. You will see. to file them increase your fee I would not, could not increase my fee. I’m in the bar! just let me be. I do not like them in a box. I think I’d rather get small pox I do not like them in a house It’s turning me into a souse I do not like them here or there. I do not like them anywhere. I do not like e-file2 I do not like them, boo-hoo-hoo. A train! A train! A train! A train! Could you, would you on a train? Not on a train! Not in a tree! Not in a car! Sam! Let me be! I would not, could not, in a box. I said I rather catch small pox. my clients can not use a mouse so now I drink just like a souse. I can not file them here or there. I can not file them anywhere. I do not like them, Sam-I-do. Say! In the dark? Here in the dark! Would you, could you, in the dark? I’d say my clients, are in the dark. Would you, could you, in the rain? I would not, could not, in the rain. E-file 2 is such a pain, Not in a car, Not in a tree. I do not like them, don’t you see? Not in a house. Not in a box. Not with a mouse. Not with a fox. I will not like them here or there. I do not like them anywhere! You do not like e-file 2? I do not like them, Sam-I-do. Could you, would you, with a goat? I’d say these forms, have got my goat! Would you, could you, on a boat? I could not, would not, on a boat. As I said, they got my goat. I will not file in the rain. I’ll only say they are a pain. Not in the dark! Not in a tree! Not in a car! You let me be! I do not like them in a box. I do not like them with a fox. I will not file them in a house. I do not like them with a mouse. I do not like them here or there. I do not like them ANYWHERE! I do not like e-file 2! I do not like them, Sam-I-do. You do not like them. SO you say. Try them! Try them! And you may. Try them and you may I say. Sam! If you will let me be, I will try them. You will see. Say! I like e-file 2! I do!! I like them, Sam-I-do! And I would file them on a boat! For they no longer get my goat. And I will file them on the train. And in the dark. They’re not a pain. And in a car. And in a tree. They are so easy you will see! So I can file them in a box. And I can file them at the docks. And I will file them in a house. A simple click upon a mouse. And I will file them here and there. Say! I will file them ANHYWHERE! I do so like e file 2! Thank you! Thank you, Sam-I-do

are you playing goal? I can't see anyone get anything past you dressed like that.

first check document to see if it says anything, or at least vaguely mentions 1 or both of the following: (at least this is how i am writing things up - I think I covered it) 5 year rule: Benefit must be completely distributed within 5 years of the death. IRC § 401(a)(9)(B)(ii), 1.401 § (a)(9)-3, Q&A-2 The ‘5 years’ extends to the end of the calendar year (December 31) e.g. EE dies January 1, 2003. 5 years is January 1,2008, extended to December 31, 2008. Does not matter who the beneficiary is. If no beneficiary specified, and document does not contain a provision, must use this method 1.401 § (a)(9)-3, Q&A-4(a)(2) or Life Expectancy Rule: Makes a difference if beneficiary is spouse! Non-spouse: must start receiving payments by December 31 of the calendar year following the calendar year the participant died. IRC § 401(a)(9)(B)(iii), 1.401 § (a)(9)-3 Q&A3(a) Spousal exception: 12/31 of year participant would have turned age 70 ½ (or, if later, must start receiving payments by December 31 of the calendar year following the calendar year the participant died). use spouse’s current age in year of distribution, factor for single life, re-determined each year, non spouse use life expectancy factor but subtract 1 each year IRC § 401(a)(9)(B)(iv), 1.401 § (a)(9)-3, Q&A3(b) If beneficiary specified, and document does not contain a provision, must use this method 1.401 § (a)(9)-3, Q&A-4(a)(1)

ft william provided a sample authorization form. no other comment indicating to the client implying that the person electronically signing was anything more than an idiot who was at least computer literate enough to obtain the DOL Pin number. basically in the following format Authorization to Electronically Sign and File 5500 I hereby authorize any employees of El Cheapo Plan Processing Services, Inc. ("Service Provider") to electronically sign and file 5500 forms on my behalf. I further understand the following: • I must sign a paper copy of the completed 5500 Form. • An image of my signature will be included with the rest of the return/report posted by the Department of Labor on the internet for public disclosure. • I may revoke or change this authorization at any time by written notification to Service Provider.

the only change (as I recall, and its not the form itself) is that you no longer attach a copy now that you electronically file

the dol web site lists a number of Q and As, such as yours. In particular point 3 says you can still file on paper http://www.dol.gov/ebsa/faqs/faq-EFAST2.html Q2: How can I file my timely plan year 2008 annual return/report if it is due after January 1, 2010? You have several options: 1.You can electronically file a plan year 2008 annual return/report using EFAST2-approved third-party software or IFILE beginning January 2010. EFAST2 is the new filing system. 2. You can electronically file a plan year 2008 annual return/report using EFAST-approved third-party software until June 30, 2010. EFAST is the current filing system. 3. You can file a plan year 2008 annual return/report on paper through the current EFAST filing system, using EFAST-approved software or government-issued hand print forms, until October 15, 2010.

I think if the document contains failsafe language then you have a failure to follow the terms of the document, e.g that you would correct a failed coverage problem. this would then become an operational problem , and in that case you could fix the problem under SCP. but its been awhile since I've seen the verbage for failsafe language. but I thought that was the idea of failsafe language that you could fix those problems - at the price of giving up the average benefits test to possibly pass coverage testing instead.

my understanding (?) is that if you limit comp (as in this case because the 401k portion only existed part of the year) then you would prorate the comp limit for testing as you indicated. there is a provision in the definitions (1.401(k)-6) of compensation that says you can use the calendar year comp that ends within the plan year. in that case, you would not prorate (despite of course the fact you could not defer on the comp before the entry date).

Mr. Butler: I think what was hoped for was to simply treat -up front - all $5,500 as catch up. if so, then there would be no top heavty, becasue you don't count catch ups when determining what top heavy % is required in the current year. Unfortunately for the owner there is no such option available under the regs regarding catch up contributions.

well, the default for FT William is only Plan Admin (at least for the 5500SF) and we have had a number of these accepted. early in the year I was filling out both lines (I was showing my fine ignoramous knowledge) and filling out the regular 5500s early in the year, (instead of saving time and attachments by filling out the SF) seems to me they accept either