a one participant db plan participant has benefits under guild plan.

i havent worked with coordinating guild benefit plans.

is it permissible to have his corporate db plan pay out his benefit and then notify guild plan of the benefits distributed so they can coordinate their dsitribution limits?

is there any concrete regs, code, grey book info on t his?

thanks

Any recommendations on general resources for issues related to health & welfare plan documents, 5500's, schedule A's and other similar issues?

A stock option agreement provides for a NQSO with an exercise price of 100% of grant date fair market value of the underlying stock; however, the stock option agreement also provides for a bonus equal to the exercise price for each share exercised, which is payable upon exercise. Am I missing something, or is this bonus contingent upon exercise a reduction in the exercise price such that the option loses its "stock right" exemption from 409A? Seems straight forward to me, but I'm wondering if anyone sees a different analysis.

We have a new client that created a profit sharing plan effective 1/1/2010. He was the only person eligible in 2010 and he rolled over about $232k in IRA money into the plan. He was told he didn't need to file a 5500-EZ, since the account had less than $250k in it on 12/31/10. The problem is, he anticipated putting in a $45k profit sharing allocation for 2010, which put him over the $250. He didn't have a TPA working for him at the time, so there was no one to tell him he actually SHOULD have filed that 5500-EZ.

We have been hired by him as the TPA and I want to get his filings straightened out. He has an employee that came into the plan in 2011, so he is required to file a 5500-SF now. I am concerned that fact that there is a beginning balance (over $250K) on 1/1/11 on the SF will trigger an audit.

There was another thread that was started by someone else, but gave me an idea for this plan. Since 2010 was the first plan year, and the plan only covered the owner, and the plan (on a cash basis) had under $250k in it, no filing was required. If I show the "cash" basis as a beginning balance and count the 2010 profit sharing that was paid timely in 2011 as an additional contribuiton (either in the er contribution line or on the other line in #8) along with the contribution for 2011 (we usually treat all plans on a accrual basis here) would that suffice as a correction? Or how else would you recommend to correct?

· ER A 457b Deferred Compensation Plan was established 2/1/1988

· ER B was established as a wholly owned subsidiary as of July 1, 2003 and participated in ER A 457 plan.

· Effective 7/1/12, the relationship between ER A and ER B as its wholly owned subsidiary will be ending.

· Due to this complete “spin off”, ER B will no longer be considered a governmental entity and thus will no longer be eligible to participate in ER A 457b deferred comp plan.

· ER B will be establishing a start-up 401k plan for its employees, effective 7/1/12.

With all that said will the ER B participants be able to withdrawal their money or rollover their accounts to the new 401k plan as of 07/01/12? It doesn’t appear to be distributable event, i.e., severance of employment or termination of employment. In addition, elements of same desk rule factor in that employees continue to perform same functions after business reorganization. In the ERISA world, a spinoff of the assets could move from one plan to another, but the 457 plan negates that option and I believe ER B assets must remain in ER A plan until participants are able to take a distribution under the terms of the plan.

What do you think?

My document provider is telling me that if the plan has a $1,000 threshold for mandatory cashouts, I must include the participant's rollover account in the determination.

I was under the assumption that if after calculating the balance to be under the threshold (be it $5,000 or $1,000), any mandatory cashout (or auto-rollover) would include the participant's rollover account.

they referred me to Notice 2005-05 which deals with auto rollovers.

I don't see anything in there that would contradict my thoughts on the matter.

Any other insight?

I have a fiscal year plan that I discovered made their 2010 PY (which ended on 6/30/11) safe harbor match deposit on 5/16/12. Our records indicate this PA files as a corp and they are also on a fiscal year.

We were having a discussion as to when the SHM deposit needs to be made. I thought it was required to be made by the end of the following plan year (6/30/12 in this case) but to be eligible to be deducted it needed to be deposited by the time the corporate tax return was due, including extenions.

The company currently has a sole owner; the partnership was disolved in December and he's taking on a new partner next week apparently. I am reconciling the plan's assets a little early since the owner is asking for a loan and I noticed this deposit.

If the deposit is considered late, what is the correction? Thanks for your thoughts!

One of the companies I work on has a non-equity partner who made $350,000 on his K-1.

Is he considered a key employee?

I am assuming that the 350k is more than 5% of the profits.

On what line of the Sch. I should the insurance premiums paid from the plan be included?

Does anyone have, or know where to find, the IRS covered compensation tables in spreadsheet form? I'm looking for as many years as possible. On our pension calculation worksheet (in excel), I'd like to have the tables on a separate tab so we can vlookup the year of birth and year of retirement (which I assume I'll have to manually add in a column).

OR, does anyone know of a better method? Is there a calculation or add-in perhaps?

Thanks.

Client wants to have participants complete enrollment forms at hire to attempt to increase participation - eligibility is age 20, 90 days, quarterly entry (calendar year plan) - the payroll system has the rules for eligibility entered so elections can be entered at the time of completion and automatically go into effect when eligible, what are peoples' opinions on having enrollment forms completed so far in advance of entry date? Definitely seeing issues with those folks under 20 (and this employer has a fair amount of them) and issues with the SPD and SMM's - My thought is just to relax plan entry to date of hire, no age - the main goal is to get people started participating early and catch them when they are completing the rest of their enrollment forms... (or at least eliminate the age 20 rule)

Any thoughts would be appreciated....

Can anyone help me out with adp testing, I have a HCE who gets refunds and he wants to know if by making Roth contributions would that bypass the testing since its after tax?

Does anyone know of a document provider who has an approved DB/K prototype? Relius and Datair do not. Ft William says they do, but it is separate DB and 401k documents wrapped together with a third document. Just looking at options.

Hello,

I am completing a 401A comparibilty test.

A key employee has been eligible in the past and now for 2011 works under 500 hours.

the key employee still works for the company but will not receive a employer contribution because the hour requirment is 1,000 hours.

Can I include her on the 401A test or do I not include her because she did work under 500 hours.

Thank you

Our directors deferred compensation plan has an operational failure with respect to a former director. Whether or not she is still considered to be a director will impact which correction we use. She was no longer a director at the time of the failure. The more concervative approach is to treat her as an insider, but I'm not sure this is appropriate since the language in Notice 2008-13 contemplates the present tense "is a director."

Any thoughts?

Say you have a safe harbor matching contribution formula. Definition of compensation includes bonuses. (and bonuses are determined only at the tend of the year)

Employer wants to amend definition of compensation, for purposes of the safe harbor match only, to exclude bonuses. Let's assume the compensation paid for 2012 under the modified definition of compensation will pass 414(s) testing.

Can this be done for 2012? This isn't per se a reduction in the match formula, only a reduction in the definition of compensation to which the formula applies. I think it is ok, but I'm concerned that I'm missing something.

In the past, a plan's 5500 was produced using a cash basis. They are now our client. We generally do the forms on an accrual basis for our clients.

If we change it to accrual, how do we go about it?

Small plan filer. Just adjust in other income what's necessary? Any thing else? Is there a footnote somewhere?

Lets say you have a 401k plan in which you are using net compensation to perform the ADP test. The plan fails the ADP test so you need to calculate returns. Lets put some numbers to this:

NHCE ADP is 3.25%

There is only one HCE with the following info:

$120,000 gross comp

$12,000 in 401k

$1,200 in 125

HCE ADP is 11.24% ($12k / ($120k-$12k-$1,200))

You use the two step leveling to calculate the return.

Is the return $6,393 ($12k - ($106,800*5.25%))?

Or is the return $6,074, which is calculated as follows. If the participant deferred 5.25% of net comp the would have been able to defer......$120k-$5,925-$1,200=$112,875. $112,875*5.25%=$5,925. $12k-$5,925=$6,074

We have a client with 100+ individual Fidelity accounts. We advised them to aske Fidelity what they would be providing for 408(b)(2). Fidelity's representative's position was that they are not subject to 408(b)(2) on these individual account arrangements and the fee information for 404(a)(5) was provided when the account was established.

one-day later...

We now have a letter from a different client, from Fidelity that they are subject to 408(b)(2). It seems the representative above is ignorant to the policies of the company.

For the participant count on the 5500-SF lines 5a-5c, the instructions on page 11 say to include “retired or separated participants entitled to future benefits. This does not include any individual to whom an insurance company has made an irrevocable commitment to pay all the benefits to which the individual is entitled under the plan”.

Would this mean a 403(b) account? Or would this apply when a defined contribution plan has purchased an annuity for a participant as a distribution option?

Thank you.