Bob the Swimmer

A benefits broker is absolutely essential and we suggest at least two annual meetings in their regular service listing to discuss the account, how to improve benefits, cost-saving suggestions and a plethora of other topics. They provide quotes and help to insure the insurance services you want for a price that is reasonable. We have done an RFP 3 x in 10 years to make sure we are getting the current, most creative services that we can afford.

Agree with Belgarath and CuseFan, an option is only an unexercised opportunity to own.

My recollection is that states/localities have informal broad guidelines as we handled two estates in my family for Pennsylvania where I was an executor and co-executor. You could also check with a Trust Officer and ask what the guidelines are for their jurisdiction. Or it could be found on google.

Agree with all others that this is pretty remote for the fiduciary status-----several different investment advisors could provide their own newsletter for no fee to a plan that is evaluating different mutual funds mentioned----the "for a fee" requirement ties it down pretty well in terms of direct impact---most of us who provide a lot of pro bono work just do it to give back, period. Even if some remunerative intent is given, it still seems too remote to be considered a fiduciary. Great question, Peter. Best wishes for the New Year to everyone.

Compensation is my main universe and you would need to check any of the public resources available as to market-pricing a position , but that is a mixed bag. These positions are very difficult to market-price accurately and to know in advance because as "rather be reading" says well it depends on experience, and from the employer's perspective, the size of the employer, the strength and history of the employer's practice, what is your effectiveness and record of job accomplishments (all of the things that a good employer values in an employee). Geography is far less of a factor generally in someone's salary than the size of the employer in my 46+ years of consulting. For me, a good set of interviews could determine for a prospective employer how effective/productive you are at what you do---but I always give someone a project or two beforehand to see how they would handle it and ask for writing and problem-solving examples of their work. Your client service and client retention skills are very important in this arena for any employer because they vary widely in the marketplace. And good writing and communication skills are critical in any job in our business. The TPA marketplace should be continuing to be strong, especially if the new tax law affects significant parts of the Code as it relates to the lower 400 sections.

CB Zeller is right--it's the old two-for-one rule; but remember it's still two separate audits that can take place at the same time---saves the client some time and money in my experience.

With due respect to Peter's answer, a lot of the potential problems (ERISA-related--numbers 2,3 and 4 on his list) go away if the Company timely filed an ERISA exemption certificate as provided by the regulations the way we do for all of our NQDC plans. While a "select group of management or highly-compensated" as the DOL qualifier language from the statute has been open to interpretation over the years by various experts, it would be important to get experienced ERISA counsel involved as Peter also recommends. I'd also be interested in an IRS practice and procedure (periods and methods we used to call it) expert perhaps filing a catch-up for back salaries and taxes to make this right going forward--from a large CPA firm perspective, we had specialists who would handle problems like this fairly often with their good network of contacts at the regulatory agencies---but I'm also not so sure about any securities law violations. I also agree with Peter that undoing this in the right way as quickly as possible reduces the disgruntled ex-executive's leverage, if any.

represented a couple of NFPs in VCR and couldn’t agree more with Luke- IRS does seem to consider pertinent facts about the plan’s error and nature of the violation, the size and complexity of the employer , etc.

We’ve had two of these this year (2021) responding to letters from Philadelphia DOL- we follow the “take their suggestion “ philosophy and duly filed DFVC and already received compliance letters for each client.

I answered on the original text that if you change accounting methods there is an IRS form to file . We used to file it, not sure if it's still considered appropriate.

Mary I believe it’s far more typical to have the same array of investment choices for each type of account IMHO.

I remember working with this rule---and I have two LLCs and I would think that the answer is yes, if it has a Board of Managers that is at least 80% common representatives. But, in fairness, I have not looked at the regs in a while.

Agree with well-stated thoughts above. Like most things, there is a place, however limited, for the product. I have thought that it basically protects the recipient from his/her own investment inexperience/ignorance/inertia in some cases. 20 years ago we market-priced annuity products quite often for DB plans that were terminating---but I've never in 45 years of consulting seen a DC plan participant ask for it.

What does the plan document say, which is usually fairly broadly worded ? Also, what does the Participant agreement say ?

Sorry about from the hip answer---Depending on plan document, we had several bogus SSNs for a south Texas employer and I believe that forfeitures to the other employees or reducing that year's contribution was the way we went. If not desired, they could also pay plan expenses if the forfeitures allow it (or with a plan amendment to allow).

I agree with Belgarath and Bill, among others. The CEBS (I was in the first class of graduates in 1980 and there have been more than 30k since) designation was designed to let employers know of its existence as it was a valuable insight, especially in the early days, to someone's skillset--same with the ASPPA designations (and I was around when those began) which are great and were started for a purpose to help people learn the most complicated statute ever written --ERISA (Every Rotten Idea Since Adam). My law degree and CPA took 4 years and 3 years respectfully and I'm sure it's okay to list them---both my kids are doctors and neither they nor any doc I've ever worked with and for ever lists their undergraduate education--I don't know where that comes from. I have a friend tho who has 9 professional designations and he is a good man (I believe), but his business card has a pyramid of the designations which IS a little much IMHO.

Agree with ESOP guy--I've been working with TPAs since the mid-70s---(started when I was 12)---and that is a recipe for VCP as was ably noted.

Many vendors really screw up the NQDC reporting---I was with one of the largest national HR consulting firms and found out that they were overwithholding on my NQDC for a couple of years by having a local tax jurisdiction which had nothing to do with my work location, take a piece to the tune of a few hundred dollars over 10 years---my point is it's not uncommon because it's different from 401(a) plan withholding. ToMoJo's point, it can be like herding cats to effect any changes.

A memo to file saying what really happened might be helpful for future IRS inquiries. Without digging back into the cases and Code, my experience is that if several people leave voluntarily in a small plan, that does not qualify, because it is intended to cover ER actions that cut large swaths of employees from a company. Several clients have had audits, but we've kept it limited to one year with the agent and also segregated employees based on voluntary or involuntary terminations. IRS also has been known in my experience to target declining industries with large layoffs that are widely reported.

Nobody has mentioned IRS Change in Accounting Method Form 3115, so it may not apply here, but I seem to remember that it did many years ago. Just a thought without major research.

Basically Green---You seem articulate and interested in the subject matter--that's why I put forward those two suggestions and certainly there are other alternatives. Be safe.

Your questions are well-founded and thoughtful. I'm reading the very good responses by BG, Lou and CB (all regulars) to this new member to the Board and wondering whether it's also helpful to suggest to you the ASPPA or other courses like CEBS that many of us took (and take) over time to try to stay on top of all these rules, plus the 20-40 years of experience. There are good ways to over time improve one's knowledge base and, for most of us, it should be a lifelong experience. I know for me it is.

If there is a series of mutual fund investments and an investment manager involved, we have gotten them to list the returns for each mutual fund over the late period and then we chose the highest one. In one case, last year, that was the client's gold fund (because everything else was tanking) ! Just a thought....

In other words, what does the Corporate resolution say is the effective date of the plan termination ?

I agree with MoJo--depending on the plan's history, this seems pretty de minimis and we would normally treat it as such. Amount is very small (depending on plan's size, regular contributions, participant account balances, other history etc.) and delay is very short.