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lori

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  1. lori

    Death Benefit To Niece Or Spouse?

    Actually I stated that the participant did NOT have a new beneficiary form waiving spousal rights. I believe ERISA 205 provided the answer I was looking for. Thanks for your reply nevertheless.
  2. a participant in a small 403(b) recently passed away with a balance of appx $18K. He was married last fall and passed away in March. In the 90's, he completed a designation of beneficiary naming his niece as beneficiairy. he did not fill out a new one when he married last fall having his wife waive benefits in the presence of a notary. His spouse automatically became beneficiary when they married and obtained a license, yes?
  3. safe harbor 403(b) has to have a 1 year eligibility correct? you could not have 2, could you? also, if you had 1 year, could you do an enhanced match of 100% up to the first 6% deferred? I believe there is a limit on the enhanced match.
  4. lori

    Vcp For 403(B)

    a small 403(b) (less than 12 participants) was established in 2005. Plan allows for deferrals and a 6% employer base contribution only. Document states no age/service requirements and only excludes the basic leased, no resident, etc. The plan has uniformly and non-discriminatory been operating under the eligibility requirements of 1 year of service and age 21. I understand that the Universal Availability requirement applies and that all non-excluded employees should be allowed to defer upon entry date (first day of the month following date of hire). My questions are: 1) Would the sponsor be required to allow the participants to go back and make up deferrals for the year they were not in the plan? Would the plan sponsor have to make up any deferrals? 2) If the plan was operating not in accordance with its provisions, but was in fact operating uniformly and non discrim, could they amend the plan retroactively to state that the eligibility is in fact 1 YOS/age 21 for the 6% employer base? This would allow the sponsor to not have to go back and make up the 6% for each participant. 3) If the plan could not retroactively amend through VCP, then the solution would be for the plan to fund the 6% and it would have to calculate the gain/loss on those amounts to make the accounts whole, correct? Thanks in advance for comments.
  5. lori

    457 B Distribution W-2

    Should the W-2 issued from a terminating 457b plan be in the name of the employer or the plan? What are the with holding requirements and how are they reported on the W-2? Thanks
  6. lori

    2 Year Employer Match

    Yes, i was looking for a response on entry for matching purposes. Employees qualify for the 2 year entry date for the match, even if they have not been employed for 2 years. i.e. date of hire is 8/1/07 two years would be 8/1/09 yet for matching purposes, they start receiving match on the first day of the plan year 6/1/09. Generally most plans have 2 entry dates.
  7. lori

    2 Year Employer Match

    a high school has immediate entry on deferrals, but a 2 year waiting period for the employer match. their new doc states that for matching purposes, the match has two entry dates the earlier of the first day of the plan year (June 1) meeting 2 year requirement or first day of the 7th month(dec 1). However, they have not been administering the plan as such. They assess eligibility at the first day of the plan year (June 1) and if a employee lets say started working in August of 2007, they qualify for the two year requirement as of June 1, 2009 or appx 1.8 years. Something under the "3/5ths rule". Since they are a school and a lot of their employees being in August. Is that ok?
  8. a 403(b) that is terminating and shutting down the company later this year, suspended its match mid plan year 2009. they are now wanting to go back and match those accounts as well as match for 2010 plan year. when the plan was amended the match became discretionary. they have not filed their 2009 tax return or 5500. how much trouble could they get in for giving money to their participants? they have about $100,000 they want to allocate to about 40 actively participating participants.
  9. A 30 participant 403(b) is terminating their plan and they have a 401k. the 401(k) allows for rollovers and loans. I am of the opinion the participant CAN rollover their loan balance as long as it doesn't substantially change the terms of the loan. What if the participant also has a loan balance in their 401(k). The 403(b) loan is not treated as a new loan is it?
  10. 403(b) is terminating and the participants are getting the option to rollover their 403(b) funds to their 401(k). One participant wants to use those funds to pay off their loan. Wouldn't seem to make much sense since, it would have to be distributed and taxed first, then used to pay off the loan, if that is an option.
  11. lori

    Terminating 457(b) Plan

    Thank you Intruder. I trust someone, her former employer or a cpa, will need to issue a 1099-R for the 2010 plan year as well reflecting distribution. Also, should a resolution be prepared effectively terminating the plan?
  12. lori

    Terminating 457(b) Plan

    Thank you. To elaborate, this is a non profit, non governmental plan, so ultimately the participant will have to take a taxable distribution, correct? She could take a lump sum, less income tax withholding or perhaps buy an annuity, but a rollover is not an option unless its to another 457(b) that allows for rollovers? If she opted for an annuity, the purchase amount would be net of taxes? As for the document, it was restated effective 7/1/03 to incorporate the final code 457 regs regarding EGTRRA published 7/11/03. As for distributions, the AA states that distros are made as soon as administratively feasible and that lump sum single payment is the only method. However, the plan permits a participant, with the plan administrator approval of election, to elect to postpone distribution beyond the time the Employer has elected (Immediate) and also to elect the method of distribution (lump sum). So does this mean that she could continue to maintain the contract or perhaps take installments with the company's approval? Why would they do this if they are going out of business?
  13. I understand that. However, with new and extensive 5500 reporting requirements for ERISA 403(b) plans eg Schedule H or I, you are required to report distributions to terminated participants effective for 2009 plan years. If a participant owns the contract as opposed to the plan or plan sponsor, how does one report a distribution paid. In the past you did not have to report distributions, how is it possible to report them now when the participant owns the contract?
  14. lori

    Terminating 457(b) Plan

    a non profit has a 457(b) for one participant and the NP is going out of business. The participant is wanting to leave the assets where they are at. Is that possible? Could she just pay the taxes and leave the funds invested as is? Also, I am under the impression there are no reporting requirements(5500) for a terminating 457(b) since it is "unfunded". Correct?
  15. Hi First post here. A company is going out of business in June 2010. They have about 50 individually owned contracts in the plan. How on earth are they to report distributions on Schedule I for 2009 and then again for 2010 when the plan is terminated by resolution?
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