Does anyone know whether Amendment to IAS 19 requires an employer to disclose an estimate of withdrawal liablity for participation in a multiemployer pension plan? The International Accounting Standards Board released this Amendment in June of 2011. I can't quite tell if a withdrawal liability amount must be disclosed or just a description of potential withdrawal liability or wind-up liabilities. Thanks for your help.

We have a partnership client where the partners made PS contributions above their deduction limits in 2010. They are amending their tax returns for 2010. What is the mechanism by which to fix their plan? Actions that need to be taken?, etc…

Thanks

I'm trying to help a small church set up a 403(b). I have a few questions:

Is it possible to set up the plan document to give one employee (head pastor) a lump sum contribution each year? ie: we will put in $10,000 each year?

Ideally, we would like to do the following:

-3% match for all church employees

-Allow employee contributions

-Lump sum each year for the head pastor

Is it possible to do this? I have no clue where to look for sample plan documents. For something this basic, do we need to hire a firm to do it, or could I do it myself?

Ideally, we will do this through vanguard 403(b)(7) accounts for small businesses.

Good morning all!

Does anyone by chance know what the rule is for preserving distributions to a 401(k) plan? Specifially, we have a terminated money purchase plan with about a dozen account balances of missing participants (only one a bit over $1,000, the rest under). I know that under DOL guidance, you can roll over these amounts to IRAs, among other options. However, that guidance assumes that there's no other defined contribution plan into which the account balances can be rolled over, and we have a 401(k) plan. However, I thought that a distribution of this sort is limited to certain forms under the Internal Revenue Code.

If someone can shed any light on this problem, that would be great. Thank you!

Have a prospective client who currently has a SIMPLE IRA set up for his co. There are approx 3 - 4 IRA's set up in the SIMPLE. He's unhappy with his investment provider. Can these IRA's be transferred to another investment vehicle under the same SIMPLE IRA. The prospect is intending to kick off a 401(k) plan at 1/1/2013, but in the meantime wants our firm to manage these SIMPLE dollars. If anyone could point me to regs, source doc that tells me we can do this without restarting the 2 year period that $'s have to be invested, I'd greatly appreciate it. (Idea is to close the SIMPLE IRA at end of '12 and roll those $'s into the 401(k) plan)

Must international students covered under plan if they met the age/service/compensation requirement?

I'm a complete novice at life insurance as an investment in a 401(k), so I need help with the basics. Plan has old life insurance investments from plans that were merged into the plan years ago. The participant has died and no distributions have been taken from the account. No one seems to have a copy of the policy.

As I am digging into getting a copy of the insurance policy, could anyone fill me in on the basics of how this would generally work at this point? Who fills out the claim form? What happens to the proceeds if the beneficiary has not requested a distribution from the plan?

Everything I've found on this gets into the details, but skips these basics- any help you can provide would be much appreciated!

Background: PS plan with 401(k) and prevailing wage. Prev. Wage is from federal jobs. Plan has one HCE (owner) and is not Top Heavy. 3 eligibility requirements. PW is immediate upon hire. 401(k) is 6 mos/age 21 enter 1/1 and 7/1. PS is 1 year (1000 hrs) and age 21, enter 1/1 and 7/1. PS contribution can be offset by PW. Not everyone works PW.

Question: for New Comp testing, do I need to give a minimum gateway to those employees that received a PW contribution but would not be eligible for a profit sharing contribution? My gut says yes, because it's still an employer contribution. But I will run into this example: Joe and Bob hired on same day. Joe works PW jobs, Bob does not. Joe receives, let's say, 3% in PW contributions. If he needs say 5% min gateway, he gets another 2% ER money. Meanwhile Bob gets zippo because he not's eligible for profit sharing.

I've researched and still researching but coming up empty so far. ANY comments, suggestions, links would be appreciated. THANK YOU! PS I originally posted this under 401(k) but deleted and posted here.

Company A owns 49% of Company B. Both are C corps. Company A currently has a 401(k) plan for employees. Company B is looking to start a 401(k) plan for it's two employees. Would this be considered a controlled or affiliated group?

Company B is a engineering service company that provides exclusive work for Company A. Company A's primary business is software but also provides services to Company B (legal, accounting, IT, HR, etc..)

Is there any way this would be considered a controlled or affiliated group?

Thank you!

I am completing the 2011 nondiscrimination testing for a calendar year plan. The Plan Sponsor typically provides discretionary nonelective contributions that require a General Test. The plan document defines the contribution period for the discretionary nonelective contribution as the 12-month period ending each June 30th, but, to futher complicate matters, the contribution is actually invested in participants' accounts each payroll period, which appears to be bi-weekly or semi-monthly.

The client decided not to give a discretionary nonelective contribution for the period ending 6/30/12, so for the 2011 testing period, discretionary nonelective contributions were only given from 1/1 - 6/30. The plan is not satisfying the General Test likely because the contributions are only for six months but the compensation is for 12 months.

I found reference in Treas. Reg. Section 1.401(a)(4)-12 defining plan year compensation as IRC Section 414(s) compenstion for the entire plan year or any specified 12-month period ending in the plan year, so I believe I can complete the General Test using compensation for the 12-month period ending 6/30/11, but I cannot find anything confirming if I can also include contributions based on that same time period. Has anyone come across this situation, and if so, how did you handle the General Test?

Employer P maintained a nonqualified defined benefit SERP for its employees. Because the amount was not reasonably ascertainable until just before an employee retired, P determined the FICA liability and paid it for the year in which the employee terminated. Employee C terminated employment in 2010 and his/her FICA liability was determined and paid during 2010. P is in bankruptcy proceedings during 2010. Two years later, P emerges from bankruptcy and agrees neither to fund or pay its nonqualified deferred compensation plans. Does the fact that the payments under the plan stopped require a recalculation of the FIC A liability? .df

Do I need to include the plan characteristic Code 3B to indicate that the plan covers self employed. The plan covers "not" just self-employed but others as well. Is it correct to include this code on the 5500.

Thanks

1) Where is the rule that states if you are offered a 401k through your company (and are eligible), you may not contribute to an IRS?

2) If someone is unemployed in the first half of the year and contributed the max to an IRA and then he is hired and immediately eligible for the 401k in the same year, is he allowed to contribute? If so, would it be the difference between the limit and what he contributed to the IRA?

A school teacher taxpayer has come to me with the following question:

Teacher is retiring in June of 2012. The school district, as part of the current contract, has agreed to pay the teacher an amount equal to $1,000 per year of service. Teacher has 32 years of service, thus a payment of $32,000. However, the contract provides that the payment must be made to a 403(b) plan. School has an employee contribution only 403(b) plan in place, and teacher is currently deferring $1000 per month to a long standing annuity under the terms of the plan. The teacher, while retiring in June, is paid through August 31, 2012; thus, will have $8,000 of elective deferrals through then.

The teacher contacted the 403(b) plan provider that administers the annuity being utilized. The provider said that since the $32,000 payment is an "Involuntary contribution" to a 403(b) plan, that the IRC limit on contributions is increased to $50,000, from the $22,500 limit. Therefore, the entire payment and current deferrals ($32,000 plus $8,000) are within the IRC limits for 2012.

The current financial officer of the school has never heard of this and is asking to see the rules regarding IRC 403(b) involuntary contributions in writing. Could anybody please point me to where this is contained in the IRC 403(b) regulations?

Thanks for any replies!

Duh!!!! The limit is the annual addition limit. Tax season has mushed my brain!

I am trying to get a better understanding of the testing requirements related to Health & Welfare plans and have heard different things from different sources:

1. Exactly what tests must be run?

2. I've heard that in some instances that you dont need to identify the highly comped? Doesnt sound right?

3. In determining the highly comped, what income is suppposed to be used?

4. When is testing done....I have someone telling me that it is typical to do testing near the beginning and then again at year end?

5. What are some good vendors for testing and how much do they charge

6. Do people test company paid life insurance/add polcies.....is it required if all employees get the same coverage (1.5 times base)?

Thanks.

Also, if someone can point me to some good articles to help educate me, it would be appreciated

For those of you who use the online edition of the EOB, are you happy with the changes they just made? Although it seems "prettier", I find the navigation much more difficult than before. Does anyone know of alternative reference manuals (online) to which I can subscribe? Thx.

Have a cross tested 401(k) plan with about 50 participants.

Have always felt comfortable using accrued to date based on average comp. Is it permissible to use accrued to date based on current compensation and permitted disparity?

Thanks

My company has a DB plan with about $350k in assets. We'd like to terminate the plan immediately but are about $200k short of what's needed to do that. We intend to fully fund the plan over the next 3-5 years and terminate it as soon as possible.

Unfortunately, PBGC premiums ($3800 this year alone!) administrative/filing costs, property taxes and the annual surety bond for the plan's real estate holdings mean that we pay $12k-15k annually in administrative overhead, far more than the investments earn in the current environment. It seems to me that it makes more sense to borrow the money from the bank to terminate the plan now. The interest we'd pay would be about 1/3 of the administrative costs, we'd be free of the reporting burdens and would have this monkey off our back for good.

Does this sound practical? We have some assets we could use to guarantee the loan, and I assume our plan contributions would still be tax deductible?

Thanks in advance.

I am not a professional. I have searched as best I can for answers in these Forums.

Wife's 401K (Fidelity - approx. $185K) required spousal consent to change beneficiary (me). Big law firm she worked for went bankrupt. Suddenly, all the funds are gone and I just discovered that she rolled it into a Fid. IRA with her sisters as beneficiaries; not my name. Her explanation: an email said that she had to end the 401K b/c of company bankruptcy and that I do not "deserve" anything. In Virginia - not a Community Property State. -- Wife went with partner (as legal sect'y.) to another big law firm where she now has another 401K started Approx. $6K.

My understanding is that the 401K "Plan" continues even tho' company is gone with appointed P.A.'s.

Q. - Would Fid. need spousal consent to do the rollover AND change beneficiary? (Possible forged signature?)

Talked with atty. today (re: divorce) who said he would need to bring in a CPA. $5K retainer for atty. - Not Sure I can afford the CPA. From what I have read here and elsewhere, I feel that I know more than the divorce atty. re: 401K, ERISA, QDRO, tax consequences, etc.

Any advice, suggestions, things to ask, etc. would be most appreciated. Note: I just turned 70 1/2; so, the MDR kicks in this year.

Thanks! <gut wrenching stuff for me>

I HAVE REPOSTED THIS UNDER CROSS TESTED PLANS. THANKS!

Background: PS plan with 401(k) and prevailing wage. Prev. Wage is from federal jobs. Plan has one HCE (owner) and is not Top Heavy. 3 eligibility requirements. PW is immediate upon hire. 401(k) is 6 mos/age 21 enter 1/1 and 7/1. PS is 1 year (1000 hrs) and age 21, enter 1/1 and 7/1. PS contribution can be offset by PW. Not everyone works PW.

Question: for New Comp testing, do I need to give a minimum gateway to those employees that received a PW contribution but would not be eligible for a profit sharing contribution? My gut says yes, because it's still an employer contribution. But I will run into this example: Joe and Bob hired on same day. Joe works PW jobs, Bob does not. Joe receives, let's say, 3% in PW contributions. If he needs say 5% min gateway, he gets another 2% er money. Meanwhile Bob gets zippo because he not's eligible for profit sharing.

I've researched and still researching but coming up empty so far. ANY comments, suggestions, links would be appreciated. THANK YOU!