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  1. Participant is still working at age 74 and therefore has delayed taking any RMDs under the still working exception. Participant dies on March 1s and their surviving spouse is the soul beneficiary. When is the first RMD due? December 31st of the year of death? April 1 in the year after death? Dec 31 in the year after death?
  2. A lot of these are dormant accounts that have been sitting on the books for 10+ years after the death of the participant. What is the best approach to take once the RBD has come and gone?
  3. Curious how other people might be handling a situation we keep coming across. In these scenarios, a participant dies without a beneficiary so it defaults to the estate. The Account balance is relatively low (usually under $5k) and no one is willing to accept the benefit because either (1) the cost to probate the estate exceeds the value of the benefit and the state does NOT allow small estate affidavits, or (2) the estate has already been probated (generally making it ineligible for small estate affidavit) and the cost to reopen the estate exceeds the value of the benefit. How do we get these assets distributed without subjecting the plan to significant risk?
  4. Plan participant’s account is hacked by an outside fraudster. Participant sues plan sponsor for negligence. The two parties end up settling before trial. Can the plan sponsor deposit the settlement amount into the participant’s plan account? I seem to remember some IRS guidance saying it’s allowed if it is the result of a dispute that would have resulted in fiduciary breach. Does anyone have a cite?
  5. A recordkeeper is basing their fee to service a PEP based on the merits of each individual adopting employer. In other words, the fees for each adopting employer within a given PEP will be different and determined based on their respective total assets (the greater the assets, the lesser the fee). This will inevitably create a situation where the PEP participants will be paying different fees from one another. Could this create a prohibited transaction or otherwise violate ERISA?
  6. Can a service provider agree to pay fees that would have otherwise been charged by a different provider and taken from plan assets?
  7. Each plan has their own plan document, so I'm not sure a PEP is an available option.
  8. Would there be anything legally preventing a recordkeeper from commingling the assets of multiple Solo 401(k)s into a single trust account to achieve efficiencies for the all the individual plans? I know certain parts of ERISA do not apply to a Solo 401(k) plan, but I'm wondering if any of the sections that do apply would prohibit this practice?
  9. If you were to take this position, could you then rollover the QDROd funds into the participant's account? In other words, is there anything stopping a rollover from a sub-account to the actual participant account (assuming the plan doc is silent on the matter)?
  10. Husband and wife were divorced ten years ago and a QDRO was issued awarding the wife 50% of husband's account. Wife, as the alternate payee, chose to keep the funds in the plan. Husband had primary custody of children and was due child support payments from the ex-wife. Fast forward ten years and the ex-wife has not made any child support payments. Husband obtained garnishment order from the court going after ex-wife's alternate payee account. The order also mandated that the garnished amounts be rolled over to the husband's account under the plan. The only way I see this being accomplished is if a QDRO was issued for the child support arrearages allowing for a rollover to be accomplished. The plan document is silent on the rights and status of alternate payees. With that being said, can you QDRO an alternate payee's account? Also, this is more of a family law question, but can the husband use this backdue child support for his own retirement purposes?
  11. 404(a)(5) notices went out to participants within the 30/90 day window prior to first investments. Unfortunately, the notices inadvertently included two investments that were not actually available to participants. My question is, if we send out corrected notices, does the the 30-day clock restart? or can we simply send out a corrected notice and still utilize the original 30-day window? Also, could this possibly qualify for the unforeseen circumstances exception that is provided for in 404(a)(5) (I've heard this is interpreted very narrowly by the DOL)? The Regs appear to address this type of good faith error from a 408(b)(2) perspective but not a 404(a)(5) perspective.
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