IBI will work with you and your
other advisors to develop the specifics of a plan to meet your objectives. The first step in this process is for us to meet with you, so
that we understand your needs and concerns.
Most employers sponsor plans as an across-the-board benefit for their
employees, as a means to tax-defer compensation for principals, or some
combination thereof. We apply a
common-sense approach to plan design - frequently, we can provide design ideas
that achieve the stated goals in a simpler and more cost-effective manner than
originally envisioned by the prospective client.
In many cases, it is desirable to
consider many different plan designs. IBI
can provide feasibility studies, so that you can actually see how various types
of plans would work in your situation. In
the case of 401(k) plans, we find it helpful to examine the level of employee
interest in such a plan BEFORE going through the time and expense of actually
installing such a plan. IBI can
assist you in this process.
After the plan design process, IBI
can assist with the installation of the plan.
The installation process can include:
preparation of a plan document and summary plan description, (if
necessary) submitting the plan documents and all required supporting materials
to the IRS for an approval letter, conducting group meetings to explain the plan
to employees and assisting in establishing plan operating procedures.
Most plans require services on an
annual or periodic basis to operate properly and ensure compliance with
applicable laws and regulations. Some
of these services may include
Gathering employee census data and investment information
Applying the eligibility requirements of the plan to the employee census
information to determine which employees meet the eligibility requirements to
participate in the Plan
Calculating benefit and contribution amounts and requirements
4. Performing any required testing to show that the Plan is not discriminatory, as required under applicable laws and regulations and making recommendations to you as needed on ways to comply with these rules
5. Preparing benefit and/or account statements for the participants and the Summary Annual Report
6. Preparing the Annual Return/Reports: Form 5500 or 5500-EZ, and attachments and the Form PBGC-1, as appropriate
7. Determining the amount to be distributed to terminated or retired participants, and preparing the necessary forms for their signature
8. Preparing annual (and, if applicable, quarterly) plan valuations
9. Processing hardship withdrawals
and participant loans, as applicable
Sometimes bad things happen to
good plans. Plans can have
operational defects (such as incorrect contributions, mistaken distributions,
etc.), compliance defects (such as not meeting non-discrimination requirements
or failing to file required plan tax forms), document defects (such as failure
to keep the plan document updated as required for tax law changes) and other
problems. IBI has expertise and can
assist in the correction of these problems, so that a problem plan can regain
Mergers and acquisitions can
involve some thorny issues in the benefits area.
IBI has expertise and can assist in these matters, which often involve
plan mergers and spinoffs.
In many cases, a prospective
client already maintains a plan and would like to have IBI take over the
servicing of the plan. IBI is very
experienced in takeover operations and can assist in making the transition as
smoothly as possible. Frequently,
plan re-design and review of past operational compliance become part of this
PLAN TERMINATIONSometimes, it becomes necessary to terminate a plan. The plan termination process is a lengthy and complicated one - usually it includes requesting IRS approval. IBI is very experienced in plan terminations. We can assist in making the termination proceed as quickly and efficiently as possible
Circular 230 E-mail Disclaimer
IRS Circular 230 Notice: Advice rendered in this communication, including attachments, on U.S. tax issues (i) is not intended or written to be used, and it cannot be used, for the purpose of avoiding penalties that may be imposed by the IRS on taxpayers, and (ii) may not be used or referred to in promoting, marketing or recommending a partnership or other entity, investment plan or arrangement. This notice is intended to comply with Section 10.35 of IRS Circular 230.