"Suppose you have a one participant DB where the participant is 77 and has been taking RMDs all along. His first RMD was taken on March 15 a number of years ago and since his RMD is calculated as an annual annuity payment, every March 15 he has taken his RMD. As of December 31, 2024 the plan terminated. The plan has obtained his benefit elections and he wants all assets distributed by January 31, 2025. Actually, not a problem as we have everything ready to go. Question: is it acceptable that his RMD (usually taken on March 15, which would be March 15, 2025) will now be taken on January 31, 2025?"

"We have a participant who just took a full distribution for termination and she had an outstanding loan balance. She wanted us to withhold taxes for the outstanding loan balance as well as her distribution so she wouldn't have to pay them. What we did is put the distribution in at Schwab with the total gross balance as the entire vested balance plus the outstanding loan, then calculated federal and state taxes based on that number, then put the outstanding loan balance in 'less loan balance' to offset the actual payment amount to be correct. The partipant's accountant is asking whether the loan balance, which is now a distribution and being taxed, is going to be taxed as a part of 2025, when this total distribution happened, or as 2024, when she took out the loan. Will it be a seperate 1099 for 2024 with the loan balance or will it all be part of the 2025 distribution?"

"Some takeaways on the new proposed adequate consideration regulations noted below. Comments do not predict any revisions by the Trump administration, but the DOL did a credible job in the preamble discussion in terms of rationalizing its positions. [1] The 1988 proposed regulations have been withdrawn officially. So it would be very difficult to argue reliance on them in future disputes/litigation. [2] It will be more challenging to minimize a discount for lack of marketability based on the put option rules. The DOL notes that the put option belongs to the participant and not the plan, and fair market value is determined based on the plan's ownership. This is a change from the 1988 proposed regulations. [3] It will be harder to justify a control premium. DOL would expect the Trustee to exercise more authority over management and the board. It remains to be seen how many trustees want to do this. [4] The concept of justifying a control premium based on acquiring control in the future per a binding agreement has been eliminated. However, these transactions have diminished greatly. [5] ESOP transactions that are designed so as to minimize stock appreciation will be heavily scrutinized. Preamble references a settlement with a public company involving preferred stock that converted into common upon release based on current value, so that the participants did not receive the benefit of common appreciation based on when the preferred was acquired. [6] In the accompanying proposed prohibited transaction exemption safe harbor for ESOP acquisitions, indemnification of both the trustee and independent appraiser will be prohibited. Not part of the proposed adequate consideration regulations, but a reflection of how the DOL views some ESOP advisors. This view is reflected in the preamble to the proposed regulations."

"I have learned that most insurers will not quote, let alone issue, annuity contracts to ongoing defined benefit plans covering individual participants. Does anyone have at least a few names of any insurers that will quote and issue annuity contracts in this context? Thanks in advance."

"I am confused about a provision in the recently-issued proposed regs The IRS says that a plan may allow deemed Roth catch-up elections for affected participants who have mistakenly elected pre-tax. The regs also say that a deemed election provision is a prerequire for using the two new correction methods. But wouldn't a deemed elected provision allow a plan to automatically allocate the catch-ups to a Roth account, thereby negating the need to make a correction? Obviously, I'm not understanding this correctly. Any help would be greatly appreciated."