A fairly large company that is stationed in Bermuda, has hired my firm to complete an RFP and find a US based provider to administer their retirement plan.

Does anyone know of a US vendor that can supply this client with a retirement program? Are there any issues with this scenario?

This is a multi-million dollar plan. Any ideas?

As always thank you in advance.

This client needs legal and tax advice to determine how the progarm should be structured. A qualified retirement plan must be established as a domestic trust established in the US. The first of many questions is whether the client is incorporated in Bermuda but has operations in the US which requires it to file a US income tax return. If the answer is yes then the client can establish a qualified plan. If the client does not conduct business in the US which requires a US tax return then it would need to establish a plan under the laws of country in which it is subject to.

There are other issues such as whether the plan will cover non resident aliens with no US income, etc.

mbozek,

Slightly different question - offshore company has US citizens paid w-2 income. Are you saying they cannot establish a US plan, US trust, US trustee for those persons?

I could not find anything in RIA to preclude this from happening. BUt then again I usually can't give the 'right' search criteria.

I would agree with mbozek's assessment. There now are a substantial number of big U. S. companies that have vecome Bermuda corporations. Foreign banks and other foreign companies often establish qualified plans for their employees (both U. S. citizens and resident aliens who receive U. S. source income that is reported on a W-2). You may want to look for vendors with experience in dealing with this situation, since they may need to be familiar with tax treaties (and related withholding issues) and other special issues related to qualified plans of foreign companies.

rcline46

Why would a non-US based company issue W2s? W2s etc are reporting forms for US payrolls and US withholdings etc. If a payroll is non-US it has no US reporting therefore no W2 or W3 etc.

Foreign company employees US citizens in the US. Of course they pay US income on W-2s. But you have confirmed they can establish a US Reitement plan.

Off to ASPA - be back on on Thursday!

A number of U. S. companies have "reincorporated" in Bermuda. These companies include: Accenture (the consulting wing of Arthur Andersen), Cooper Industries, Foster Wheeler, Ingersoll-Rand, PwC Consulting (via Luxembourg),Stanley Works, Tyco International, and Xoma. Most of these companies do not have substantial numbers of employees or business in Bermuda, and many of them have substantial contracts with the U. S. government. All of these companies have substantial U. S. operations and employees. They most assuredly have a substantial number of qualified retirement plans.

Sorry to bring this back up so late in the game...had a family emergency out of state!

This company is a Bermuda based company, no US citizens being paid in US funds. No US income tax return. I am under the impression this will not be a qualified plan. I am looking for a US vendor that can run this type of a plan.


Any ideas???