|News from NIPA.org, August 8, 2012|
NIPA's bi-weekly e-newsletter, News from NIPA.org, delivers the most up-to-date industry and association news.
The Latest Q&As for TPAs
Q: Fee disclosure - For purposes of the quarterly statements that participants receive, do the statements have to itemize the expenses paid out of the account? Can the expenses be summarized or do you have to itemize a list showing each time a fee was paid?A: The requirement is to provide "The dollar amount of the fees and expenses...that are actually charged...during the preceding quarter to the participant's...account for such services; (and)....A description of the services to which the charges relate (e.g., plan administration, including record-keeping, legal, accounting services); and...".
A: Yes. A 403(b) plan document can provide that the maximum deferral allowed is the limit under 402(g), without regard to 402(g)(7). This is not a universal availability issue.
A: No. Rev. Proc. 2012-6 provides that, "An application will be deemed to be filed in connection with plan termination if it is filed no later than the later of (i) one year from the effective date of the termination, or (ii) one year from the date on which the action terminating the plan is adopted."
A plan document may provide
that, once a participant or beneficiary begins to receive plan benefits,
assignments totaling not more than 10% of any benefit payment may be made.
However, the assignments or alienations must be voluntary and revocable. An
attachment, garnishment, levy, execution or other legal or equitable process is
not a voluntary assignment or alienation.
Q: If we have a client/physician maxing out in his own retirement plan - but he moonlights (as an independent contractor) at a hospital making another approximate $20k, can he participate in the hospital retirement plan as well as his own plan?
If he is not an employee of the hospital, he cannot participate in
a hospital-sponsored retirement plan.
Q: Is the 415 limit - individual to the "person" or the "plan"?
A: The 415 limit applies to
the individual. However, all plans of
the same (or related) employer must be aggregated for this purpose. A plan sponsored by an unrelated employer
generally has its own, separate 415 limit.
In limited circumstances, a 403(b) plan of an unrelated employer is
aggregated with the first employer's plan under 415.
Q: Would it matter if the
hospital had a 457(b) governmental plan? What about a 403b?
Yes. 457(b) plans are not subject to 415 (they have their own
limits under 457, which is not aggregated with the limit under 415. An
independent contractor can be covered under a contracting company's (the hospital, in this case) 457(b) plan.
TAG is a technical support service that offers answers to pension questions via e-mail. TAG subscribers have access to an extensive Web site with a full array of links to primary source materials, a database of over 4,000 FAQs asked by pension professionals, tools and much more. Subscribers also receive daily updates on breaking news in the industry. For more information about TAG, go to: http://www.tagdata.com. TAG is part of Wolters Kluwer Law & Business, which includes CCH, Aspen Publishers, and FTWilliam.com.
Have a comment on a recent NIPA News story?
Keep the conversation going and visit us on LinkedIn!