Message Boards Digest

January 9, 2018

Here are the most recently added topics on the BenefitsLink Message Boards:

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ERISAAPPLE created a topic in Retirement Plans in General

Earned Income from Separate Affiliates in Controlled Group

Plan document defines Earned Income as "net earnings from self-employment with respect to which the Plan is established, for which personal services of the individual are a material income producing factor." Plan is sponsored by ABC, LLC. Owner O owns 100% of ABC. O also owns 100% of XYZ, LLC. XYZ has no employees. O has net earnings from self-employment from XYZ that he would like to use to support his compensation in the plan. My question, must XYZ adopt the plan as a participating employer in order for O to rely on the NESE from XYZ? My thought is that it couldn't hurt, so why not?
Number of replies posted  5 replies      Number of times viewed  65 views      Add Reply

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katiejoseph created a topic in Humor, Inspiration, Miscellaneous

Using Form 2848; IRS Representative Wants Practitioner's Social Security Number

On a call with an IRS representative today, after I faxed over Form 2848, the representative asked me for my personal SSN in addition to my CAF number and my client's EIN. When I expressed surprise, she indicated that it was a very new IRS procedure. Has this happened to anybody else?
Number of replies posted  4 replies      Number of times viewed  69 views      Add Reply
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bevfair created a topic in Mergers and Acquisitions

Acquisition by Plan Sponsor of Another Company; Counting Past Service

Merger of two entities. Selling entity A gets absorbed by buying entity B. B's document counts past service for eligibility and vesting purposes. If participant (formerly from A) met the requirements of B's plan as of the date of the merger, should said participant be eligible immediately, or instead on the next entry date in the plan? Doc states: "Unless specifically provided otherwise in the Adoption Agreement, an Eligible Employee who satisfies the Plan's eligibility requirement conditions by reason of recognition of service with a predecessor employer will become a Participant as of the day the Plan credits service with a predecessor employer or, if later, the date the Employee would have otherwise entered the Plan had the service with the predecessor employer been service with the Employer."
Number of replies posted  1 reply      Number of times viewed  18 views      Add Reply
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ESOP Guy created a topic in Defined Benefit Plans, Including Cash Balance

Disability Payment to Already-Terminated Participant: Use Code 3 on 1099-R?

I have an ESOP client that normally makes you wait 5 years in order to get a distribution via 5 installments. They however have a provision that if a person terminates and then is ruled disabled they can be paid the year after the disability ruling. I just took over this plan. A person terminated in 2012. They were ruled disabled in 2014. They got their first payment in 2015. The firm that prepared the 1099-Rs in the past gave this person a code of 3. I am just not finding any guidance on this. Do you have to terminate because of disability or merely be paid because of disability in order to get a code of 3? It matters because the person is younger than 59-1/2 years old. Back when I did 401(k) plans, if a person terminated and refused to take a distribution for years and then became disabled, I don't recall making such a person a code 3.
Number of replies posted  4 replies      Number of times viewed  44 views      Add Reply
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Madison71 created a topic in Retirement Plans in General

Extension of PBGC Missing Participants Program to Terminating Defined Contribution Plans

Assume the PBGC's missing participants program is used by a terminating DC plan. Once the assets of the missing participants are transferred to the PBGC (and all other assets are paid out of the trust), then a final Form 5500 can be filed, correct?
Number of replies posted  0 replies      Number of times viewed  17 views      Add Reply, Inc.
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