The situation is a medical partnership of 5 MDs (Old 5). They terminate that partnership on a Friday. Next Monday, 4 start new partnership (New 4); 5th one retired. New 4 hires virtually all the same staff, but moves the equipment over that weekend to new office space. New 4 has a slightly different name (enough to get by the state's business entity registration folks).

Old 5 had a 401k plan. New 4 sets up a new 401k plan. Numerous factors are driving for a termination of Old 5's 401k plan, rather than continuing it as a wasting trust or merging it into New 4's 401k plan.

If Old 5's 401k plan is terminated and payouts processed, will New 4's 401k plan have to prevent those that went from Old 5 to working for New 4 be prevented from making 401k deferrals for 12 months following the payout from Old 5's 401k plan?

Is is possible to get attorneys' fees incurred in getting a court order to force a participant to sign a QDRO or otherwise petitioning the court to sign the QDRO on the recalcitrant participant's behalf? The jurisdicton is California but I would be interested in any and all on-topic comments, thanks.

If an Employer has 6 employees, all eligible for the 401k PSP, but only three are participating in the DB Plan, when you are calculating the combined deduction limit does the compensation for all six employees count since they are all participating in the DC Plan? Or do you only count the compensation for the employees who cross over and participate in both plans?

A plan is NOT top heavy 2009 but funds a pro rata profit share in 2010 for 2009.

The plan IS to heavy for 2010 as of 12/31/09.

Is there any way to include the 2009 ps that was funded in Jan 2010 as an offset employer contribution when determining the 2010 top heavy profit share due?

Assume no 415 limit issue.

Thank you for your input.

The Plan document allows the plan administrator to establish a buy/sell window during which participants may buy or sell employer stock. We would like to set up a window under which terminated participants may sell the ER stock held in their accounts to active participants. Does this raise any prohibited transaction issues? In most cases, a terminated participant will not be a party-in-interest, so would it just be a transaction between a party-in-interest (active participant) and a person that is not a fiduciary or party-in-interest (i.e., terminated participant). I'm still thinking through these issues, but any thoughts would be appreciated.

My eyes are old and tired so I prepare the attached Notice 2012-61 legend and thought it might be of use. As I'm unsure how or from where you printed the Notice, you will need to add your own page numbers.

Notice_2012_61_TOC.pdf

Have an LLC prospect that wants to do a combination 401(K) and defined benefit plan. How do the LLC members pay the elective deferrals to the plan, through a personal account, from their draw??

The DB plan document reads as follows:

"The Administrator, at the election of the Participant, shall transfer, as of the Participant's Normal Retirement Date, the Participant's Present Value of Accrued Benefits to the Participant's Retirement Investment Account."

The participant is at age 70 1/2 and has a Participant's Retirement Investment Account of about $500,000.

Should the Required Minimum Distribution be calculated using the DC or DB method?

Small overpayment in a 401k plan. I know I send a letter asking them to repay the overpayment, and tell them that the amount was not eligible for rollover.

Do I need to issue a 1099 showing taxable income for the amount not eligible for rollover if I know they rolled it over?

I want to make up social security numbers to do proposals on my computer.

I think I once read about a numbering convention that the social security uses that a series of numbers will never be used by them. I think I remember that if the 4th and 5th digit are 5, it will never be used by them. Does anyone know more about this?

Our employer is getting set to offer a CDHP with an HSA next plan year. There is talk of adding a limited-purpose FSA. A couple of us are questioning the need of offering a limited-purpose FSA. What is the need of offering a limited-purpose FSA when an HSA is also offered?

The reason why a couple of us are questioning the need is that it is our understanding that whatever a limited-purpose FSA covers, the HSA covers as well. So, why have both?

We have read that some like to save money in the HSA and thus use the FSA, but if one has room to contribute the money one would put into the FSA into the HSA, then why even bother with the FSA? Just put all the money into the HSA. I realize some may want to use the HSA as a long-term savings vehicle, but employees can put that type of money into the Deferred Compensation plan or open an IRA. We are talking state government here. I doubt no employee has so much disposable income to save that he is running out of places to store it and would simply use the HSA for savings purposes.

I believe there is a limit on how much can be contributed to an HSA in a given year. If a person expects all health care expenses to exceed that amount, I can see where a limited-purpose FSA would be handy. But, if a person expects to have that much in medical expenses, then why would that person sign up for the CDHP? The person would choose a different plan (one of the many low deductible plans offered).

The only thing we can think of as to why a limited-purpose FSA might be needed is that you don't have to have the money all saved up in the FSA to spend it, unlike an HSA (that is our understanding with an HSA). So, if someone expects to incur dental/vision expenses early in the year that are large, then I can see why the person would want to put money into the FSA. But, over time, that person might build up savings in the HSA and would be able to use the HSA to cover large dental/vision expenses incurred early in the year.

I'd appreciate all comments and answers to my question above. Thanks.

assume a one participant qualified plan with

sole proprietor as entity type. sole proprietor

participant dies in service before retirement age.

sole proprietor has no will(i.e., dies intestate).

does suriving spouse automatically have the power to

assume all functions of plan sponsor and plan administrator?

My reading of the PTIN rules is that a RTRP needs a PTIN to prepare and file Forms 945 and 5330 for clients and the PTIN rules carry a 15 hour CE requirement before the end of 2012. ERPAs hours can overlap, but does an ERPA need the 10 hours of "other federal tax law credits"? Does anyone have any suggestions for CE programs that would fall into this category and have any relevance to the Retirement Plan industry? Am I missing something?

Suppose you have a safe harbor plan that deposits safe harbor employer contributions more than 2 years after 8 1/2 months after the plan year end.

Along with going through VCP to make up the late contributions, are they able to take a deduction in the year the contributions are deposited?

Thanks

Any users of this application to remotely access your business PC or Mac?

Obviously, I work with sensitive client data, which includes SSNs, so am particularly concerned about compromising security. It's bad enough that despite antispyware galore, stuff can happen. Adding another portal just seems frightful.

Any experience positive or negative would be appreciated.

I have a calendar year plan that had under 100 participants at the beginning of 1/1/2010. For 2010, a Form 5500-SF was filed.

As of 1/1/2011, there were 117 participants. 29 CFR section 2520.103-1(d) allows the 2011 annual report to be filed as a Form 5500-SF under the special 80/120 rule.

If it does, is it exempt from the independent accountant's audit requirement of 29 CFR section 2520.104-46 and -41, which specify the 100 threshold, but not the special 80/120 rule?

Does anyone know of any IRS ruling that applies the special 80/120 rule to the independent accountant's audit report requirement too?

a SH 401 plan's def of comp is W-2 wages including 401(k), 125, 132(f),414(h)pickup) only excludes comp while not a participant in the plan. The plan sponsor has not included excess life insurance amounts in the definition of comp due to the fact that the employee does not receive any cash. However, it is footnoted for inclusion in the employee's taxable income. The auditor thinks that it MAY be subject to deferral and match calculations. If so, I suspect a retroactive amendment could exclude such benefit using SCP? The plan utilizes the basic SH match formula.

A Plan B was merged into a Plan A with a resolution effective 1/3/2012. The assets were not retitled at the vendor. The assets physically transferred from the old vendor to the new vendor in July 2012. What is the due date of the final 5500 for Plan B?

Administrator inadvertently distributed $150 out of participant's Roth 401(k) account. I am wondering whether the distribution should be reported on 1099-R and subject to premature distribution penalty (participant not eligible for qualified distribution)? I can't seem to find any exemption from the premature distribution penalty for this type of mistake. If the participant agrees to put the money back into plan, is it just a wash and there is no 1099-R reporting and no penalty?

I have a 401k plan which defines compensation as W2 income. The executives have the option to defer income into a 409a plan. When the 409a deferral is paid out, it is paid as W2 income. Would you withhold 401k deferrals on the distribution from the 409a plan for a current employee (assuming he is eligible to participate in the 401k and employees are eligible to take a distribution from the 409a plan)? What if the participant terminated in a prior year and is now receiving W2 income from the distribution of the 409a plan for services performed while employed when a deferral election was in place?

Thanks