A client passed away last fall, and her sister popped up recently claiming to be the executrix of the estate and heir to all of the client's assets. We as the TPA do not keep beneficiary forms on file for any of our clients. We inform them at the moment of engagement that they must be responsible for keeping up with the forms in their own offices in the employees' personnel files or something similar. The sister of the deceased says she has not found a beneficiary form. She says the deceased was divorced and that the ex-husband is deceased, and that they had no children. So far all she has provided to us is a death certificate for the deceased and a "Letters Testamentary" document with one sentence naming her as the personal representative of the estate of the deceased. She is now pushing to have the deceased client's assets transferred to her. The account balance of the client is held in an individually directed brokerage account with a well-known national brokerage house. The plan document says that in the absence of a beneficiary form, the assets go first to the spouse, and if none, to the children, and if none, "such other heirs, or the executor or administrator of the estate, as the Plan Administrator shall select." Bear in mind that the Plan Administrator was the client, who is dead. [1] To what extent are we as the TPA responsible for determining that the spouse is indeed an ex spouse, that he is indeed deceased, and that they had no children? [2] Is more paperwork required that just this one liner naming this person as the personal representative of the estate required to establish her as the executrix/personal representative? [3] Is this our problem or the brokerage house's problem that holds the funds? [4] Do we have to worry about being sued later if she lied to us and there is a current spouse/children? [5] Can the account be rolled directly to her without passing through the estate in this circumstance?

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A plan sponsor has DB and DC plan. Eligible compensation for deduction limit is $500K. 25% = $125K, 6% = $30K. DC employer contribution is $40K, in order to pass 401(a)(4) (over 6%). DB MRC is $200K as of the valuation date. I am confused what the deposit amount and the deductible amount are. My understanding is... Deposit amount = $240K (DC $40K, DB $200K), and deductible amount = $230K because the DC amount over 6% cannot be deducted?? If the DB deposit is made after the Val Date, would the deductible amount increase accordingly? Is there a way that a sponsor can deduct full $240K, if the increased DC contribution is due to the failed 401(a)(4) test?

We have a client who has not provided sufficient data to enable us to produce an annual report or a 5500 since 2014. Please don't go into the fact that we should have fired the client long ago. There are extenuating circumstances. The bottom line is that they have seen the light and have begun to provide data. We are now in a position to provide them with a 5500 to file for 2015 and 2016. Since they are not under examination at this time, we can use the DFVCP program. From their instructions it would appear that we are supposed to file all delinquent years at one time. However, we are nowhere near being ready with 2017's form and may not be for several months. What are your thoughts on waiting a few months and doing them all at one time versus filing what we do have and doing another submission later on? What if they do get a letter saying they are under examination in the interim while we are waiting to get the 2017 form done? Your ideas are appreciated, as always.

My understanding is that when cross-testing, any nonhighly compensated employee must receive the minimum gateway when he/she receives any employer provided benefit or non-elective contribution. Suppose a company sponsors a cash balance plan and a 401(k) plan which are cross-tested together. If an NHCE receives no employer contribution in the 401(k) plan (last day requirement) but does get a CB plan pay credit that equates to a 2.5% allocation rate, must he be provided the additional contribution to bring him to the (in this case) minimum gateway of 7.5%?

Plan sponsor is getting pushback from new TPA about having the plan added as an additional insured to the TPA's E&O policy. According to the TPA, the insurance broker doesn't permit the plan to be added as an additional insured. Is this a common practice?