Forfeitures

[Guest CyndyB]

We are relatively new to Quantech. I went through training in Jacksonville, but remember forfeitures being specifically left unaddressed - just that they are different from FDP.

Now I have a plan with 2 paid out participants whose unvested portions are ready to be forfeited. They remain in the main pooled trust account with 0% vesting. How do I reallocate these forfeitures with the contribution to other participants?

[Tom Poje]

Hi Cindy -

forfeitures drive many people crazy...

if plan specs are coded 'forefitures occur upon a 5 year break or payout' AND your employees are coded as fully paid out, then running a forfeiture transaction will cause them to forfeit.

If specs are coded 'forfeitures reduce contributions' then no one will receive forfeitures. Instead you look at your bottom line number for contributions and subtract off the amount of forfeitures for a 'net contribution' due by the employer.

that is in the carefree world where the $ are pooled.

If people have individual investment choices and you have to split the allocation, well, then it gets a bit more complicated.

hopefully the above info is sufficient to get you by.

do not check on the item in census 'ee has forfeited'!

[pmacduff]

CyndyB - I am relatively new to Quantech also, but we did do forfeitures in our training course. The forfeitures are reallocated based upon the information you have coded in the Plan Specifications. Look for the form with forfeitures. You will tell the system when to allocate. One choice (I think) is upon distribution or after 5 breaks-in-service. Once you have this coded properly, the system should know that your two terminees have received distribution and should be forfeiting. You will also need to run a transaction for forfeitures to allocate (it's on the contribution transaction and I think there also may be a forfeiture transaction for those held in Quantech's forfeiture suspense). I am also a former FDP user and find it very confusing sometimes to do things in Quantech that seemed so easy in FDP! Hope this helps. Patti

[Tom Poje]

one other thing, especially if the plan is integrated, you probably want to run the forfeitures and contributions at the same time.

also if you log onto relius website click on the frequently asked questions. there is a lot on forfeitures.