8955-SSA

[austin3515]

Is it mandatory to report D's, or is still optional? The instructions do not seem to go out of there way to tell you not to report them.

Any help is appreciated...

[rcline46]

Austin, I see by your question that you have never had to prove to a former participant who got a letter from the Social Security Administration that they had a benefit in an existing plan where they left 25 years ago. We have, and with all the changes in systems, etc, darn near impossible to do.

I think it should be mandatory to report Ds.

[Tom Poje]

the copy of the instructions for 2011 that I looked at (and it's said the same in the past:

opening page

right after What's New

Purpose of form:

look at bullet point 3

"previously were reported under the plan but have been

paid out or are no longer entitled to those deferred vested

benefits."

I'd hold that says if you they were reported you need to report them again.

However, the instructions this year clearly say you do NOT include them in line 6.

[ESOP Guy]

Austin, I see by your question that you have never had to prove to a former participant who got a letter from the Social Security Administration that they had a benefit in an existing plan where they left 25 years ago. We have, and with all the changes in systems, etc, darn near impossible to do.

I think it should be mandatory to report Ds.

Recline46:

Maybe I have been lucky but the last few years I have had more and more people tell me your same comment. But I have never had to do that either. I just write a letter to the person on behalf of our clients saying our records show they are not due a benefit. I have never had anyone come back and demand proof I am right. Even if they did why do you have to produce much? The document controls this and I have never read that I have to prove to someone they are not a part under the plan.

Like I said I might have been lucky and no one has called my bluff so far so good.

[austin3515]

I always report them too. This happens to be a plan that left us, we coded the plan as inactive, and we inadvertently missed a filing date for the ssa (it happens to be a fiscal year-end plan). It just so happens that ALL of the entries were D's. So we're trying to figure out if we have a problem or not.

Tom, are you suggesting bullet point 3 overrides the section entitled "When to report a separate participant" and "When not report a separated participant"? Both of those sections in my opinion suggest that I would not be REQUIRED to report them.

http://www.irs.gov/pub/irs-pdf/i8955ssa.pdf

[austin3515]

FROM THE REGS AS OF TODAY (§301.6057-1©(2)(ii)):

c) Voluntary filing —(1) In general. The plan administrator of an employee retirement benefit plan described in paragraph (a)(3) of this section, or any other employee retirement benefit plan (including a governmental or church plan), may at its option, file on schedule SSA information relating to the deferred vested retirement benefit of any plan participant who separates at any time from service covered by the plan, including plan participants who separate from service in plan years beginning before 1976.

(2) Deleting previously filed information. If, after information relating to the deferred vested retirement benefit of a plan participant is filed on schedule SSA, the plan participant—

(i) Is paid some or all of the deferred vested retirement benefit under the plan, or

(ii) Forfeits all of the deferred vested retirement benefit under the plan, the plan administrator may, at its option, file on schedule SSA (or such other form as may be provided for this purpose) the name and social security number of the participant with the notation that information previously filed relating to the participant's deferred vested retirement benefit should be deleted.

I think this is why the SSA Instructiond do not say you are required to report them. I'm sorry but the section of the instructions I've noted above simply do not require it. Tom, I see you're point, but inference is not a requirement. And a plain english reading of the instrucitons appears consistent with the regulations.

[Tom Poje]

well, perhaps not 'required' but even the IRS Q and A says

FAQs - Form 8955-SSA - When the benefits of a deferred vested participant are transferred from one plan to another, how do I report the participant?

[while this particular Q and A applies to a transfer, they didn't write a Q and A to handle every question!)

In this case, the plan administrators of both the transferor plan and the transferee plan should report information regarding the plan participant. See Form 8955-SSA Instructions, Transfer of a Participant’s Benefit to a New Plan. The plan administrator of the plan transferring the benefits, should report on Part III, Line 9, Code D that the participant’s benefits have been paid out or the participant is no longer entitled to those deferred vested benefits. The administrator of the plan receiving the transfer should report either on Part III, Line 9, Code C (where the participant was previously reported by the transferor plan and the plan administrator of the transferee plan has received all necessary information from the transferor plan) or on Part III, Line 9, Code A (where the participant had not previously been reported or information was not provided).

but then when my mom says I 'should do' something I understood what that meant.

perhaps its the difference between having

10 Commandments or having 10 Pretty Good Suggestions?????

[austin3515]

Now we're talking

[mbozek]

Austin, I see by your question that you have never had to prove to a former participant who got a letter from the Social Security Administration that they had a benefit in an existing plan where they left 25 years ago. We have, and with all the changes in systems, etc, darn near impossible to do.

I think it should be mandatory to report Ds.

Recline46:

Maybe I have been lucky but the last few years I have had more and more people tell me your same comment. But I have never had to do that either. I just write a letter to the person on behalf of our clients saying our records show they are not due a benefit. I have never had anyone come back and demand proof I am right. Even if they did why do you have to produce much? The document controls this and I have never read that I have to prove to someone they are not a part under the plan.

Like I said I might have been lucky and no one has called my bluff so far so good.

A participant who receives a letter stating that the plan has no record of a benefit due can demand that the plan administer provide proof that the benefits were paid since under ERISA the plan retains payment records such as a 1099-R. A demand for proof of payment results in one of two outcomes- the plan admin spends a lot of time combing through old records to find some proof of payment such as a 1099-R or cancelled check or the participant receives payment of benefits. Plan cannot deny a claim for benefits listed as accrued on an 8955-SSA if it has no record that benefits were paid since there is no statute of limitations on requesting payment of benefits and plan admin has fiduciary duty to maintain plan records.

These disputes can be avoided by noting payment of benefits deferred in prior years on the 8955 filed for the year benefits are paid.

[austin3515]

These disputes can be avoided by noting payment of benefits deferred in prior years on the 8955 filed for the year benefits are paid.

just to make sure no one thinks I am suggesting that D's should not be reported. Nothing could be further from the truth. My situaiton again is that a filing was inadvertently missed and the question is "Was a filing REQUIRED in the first place." That is it.

Yes, you're crazy if you don't report D's for all the reasons mentioned above.

[12AX7]

What about a situation where you've taken over a plan and don't have access to prior SSA forms? If an assumption is made that a participant had been reported with a Code A on a prior year's form, when in fact there had been no reporting, is there an implication for reporting a Code D for that participant on a 2011 form?

I've never had an SSA rejected in the past, but was wondering if anything is different with the filing of the 8955-SSA.

[david rigby]

Required? Yes, I agree with Tom's reading of the instructions.

Real world: former participants do get letters from the SSA and ask about a possible benefit. It's a PITA, and everyone should avoid it. If you are the TPA, it is your job to minimize this, so that makes the reporting of D's required.

[TPApril]

Same topic, but as related to Defined Benefit Plans - should participants who retire, generally after ssa age, and begin receiving their monthly benefits be reported as 'D', or can they be ignored?

[Tom Poje]

the instructions are pretty specific for code D

"Use this code for a particpant previously reported..." [so if the person was never reported, there is no reason for a code D (D = delete from form SSA reporting system)

if the person was previously reported then use D to

"This includes a person who has begun receiving benefits..."

hope that helps.