Schedule I -

[Alex Daisy]

A Participant joined the Plan in the middle of 2008, and already made $15,500 in Employee Deferrals with his previous Employer's Plan.

The he made Employee contributions of $9,000 into his new company's Plan for the remainder on 2008.

This was caught at the beginning on 2009, and a refund was processed in 2009 becuase they went over the 402(g) limit.

My question is how do I account for this on Scheudle I?

Do I include the $9,000 in Employee Deferrals even thought it was not supposed to go into the Plan and refund to the participant in 2009?

The money was invetsed and is showing up as part of the 12/31/2008 balance in the Trust.

Do I need to deduct the $9,000 from the ending marking value to report on Schedule I?

Any help would be greatly appreciated.

[Below Ground]

Show in year of payment as corrective distribution. Assuming plan year is calendar, it is not reported on 2008 Form. I note that some TPAs will list as a payable for 2008. I don't see any benefit to that approach.

[K2retire]

If you are filing 2008 on an accrual basis for purposes of reporting contribution receivables, I would expect you need to be consistent and also report payables. Otherwise I agree with BG.

[Alex Daisy]

If you are filing 2008 on an accrual basis for purposes of reporting contribution receivables, I would expect you need to be consistent and also report payables. Otherwise I agree with BG.

We are filing on the accrual basis, and the Auditor is insisiting that since the financial statements are accrual basis , we should pick up the 2008 ADP Refunds as a payable as of December 31, 2008.

I just want to do it the correct way.

Is there any standard here?

[BG5150]

If you are filing 2008 on an accrual basis for purposes of reporting contribution receivables, I would expect you need to be consistent and also report payables. Otherwise I agree with BG.

We are filing on the accrual basis, and the Auditor is insisiting that since the financial statements are accrual basis , we should pick up the 2008 ADP Refunds as a payable as of December 31, 2008.

I just want to do it the correct way.

Is there any standard here?

If the auditor wants it there, put it there. Just get it in writing.

[Bird]

The instructions for 2f (corrective distributions) say "Include on this line all distributions paid during the plan year of excess deferrals..."

I don't see that these pending distributions are more deserving of reporting as expenses and liabilities than, say, a distribution pending because of termination of employment, retirement, attainment of normal retirement age where a plan allows in-service distributions due to that event, other in-service distributions that might or might not occur because a participant has satisfied a condition...or for that matter, all assets of the plan, which are really just benefit liabilities. Where is the line drawn?

I would put up a fight at least.

[Below Ground]

My position, for what little it may be worth, is identical to what I believe to be held by Bird. I find that when you report remedial distributions as a payable (as I used to do 20 years ago), you simply "muddy up the accounting". While I agree that there is a valid argument that supports reporting them as a payable, I simply don't agree with that position.

I can tell you that having had many plans successfully go through IRS and DOL Audits, not once was I told to report these distributions as a payable. I suggest that a "governmental EP/EO person" should know this topic. This may not, however, be the case for the person doing the accountant's opinion for the 5500. (I am NOT saying that this is always or typically the case.) For example, I have needed to explain how an Integrated Allocation works (you know, 5.7% of TWB) to the auditor doing the "5500 Opinion". I have never had to explain something like that to an IRS or DOL Auditor.

Perhaps getting that "directive" in writing from the auditor after showing him/her the instructions that say "paid during the year" may be the best course Alex. Again, my opinion, which I expect is not worth all that much.