"I've got a stand-alone plan that has 6-year vesting (2/20). They are merging into a MEP run by a payroll/benefits firm that has 100% immediate vesting. What happens to the vesting for these people? For new money, I presume that it follows the MEP vesting. What about the old money?"

"My company is being asked to take over an HRA (section 105) plan. The plan has never filed a form 5500. I am assuming they should be. Secondly, if there are over 120 participants -- would they need an audit?"

"What does the Divorce Decree mean, it reads: 'The Plaintiff shall be entitled to her marital share in any benefits under Defendant's pension plan, or payments made in said pension plan, through his place of employment if, as and when Defendant's entitled to receive any such benefits, and Plaintiff's interest in said plan benefit shall be calculated as of the date the benefits are to be paid under said plan using the the Bangs Formula.'

"I should have addressed this with the court, but what does this mean for my ex-wife's portion of my benefits?"

"We have a small cross-tested 401k Profit Sharing Plan that provides 3% SHNEC to all plus a discretionary Profit Sharing (PS), all in their own PS allocation rate group. 3 HCEs 2 NHCEs:

• 1 is newly eligible, older and 0% vested;
• 1 is a younger, long service employee who has terminated this year with less than 501 hours and is 100% vested (wage is about 1/3 of the older NHCE).

Questions:

1. Is it permissible to increase the terminated NHCEs PS allocation rate in order to pass (a)(4) testing?
2. Could it be argued effectively that increasing the terminated NHCE is more reasonable than the active NHCE because the terminated NHCE is 100% vested whereas the active NHCE is 0% vested?
3. If this could be considered abusive on review, would it be acceptable if both NHCEs received the increased PS allocation rate, noting that in doing so the terminated NHCE would still be the only one contributing to a passing test result?"

"I am trying to pin down the proper W2 reporting on deferred comp. Specifically regaring vesting and earnings on vested portions. For purposes of this discussion I am assuming an employer contribution of $60,000 that vests 1/3 each year from the date of the award. I believe this would be described as an account balance plan where essentially there is an individual account for each participant. The employee account is credited with earnings as if the funds were invested in the market. Think like 70% VOO / 30% SCHD.

• Year 1 -- $20,000 of the $60,000 award vests, but the employee is also credited with $6,500 of earnings based on the return of the whole amount. Total account value $66,500.
• Year 2 -- the second $20,000 of the $60,000 award vests (now 2/3 vested) plus the account is creditedvwith $8,000 of earnings. Total account value $74,500.
• Year 3 -- the third $20,000 of the orignal award vests (fully vested) plus the account is credited with $9,000 earnings. Total account value of $83,500.

'I know that as the account vests that the amount needs to be included in FICA earnings under the special timing rule. Where I am confused is the timing of when the earnings on the account need to be included.

• Question 1 -- In Year 1 would I include $20,000 plus all the $6,500 in earning or only 1/3 ($2,167) of the earnings since the account was only 1/3 vested?
• Question 2 -- In Year 2, I know that again I would include the $20,000 that vests, but what do I do with the $8,000 in earnings? Obviously some portion of the earnings in year 2 is attributable to already vested and reported earnings."