Does anyone know if a NQP benefit in the form of installments can qualify for deferral under section 1035?

I have a plan document that is written with 3 groups. Group 1 is the owner, group 2 is participants with more than 35 years of service and group 3 is all others. If the sponsor wants groups 2 and 3 to receive the same contribution percentage, can I code my testing system to allocate based on 2 groups? Is there a risk that in doing so, if discovered under audit, the IRS/DOL would question why the doc has 3 group but the test only has 2?

Top heavy profit sharing plan that is cross-tested. Each participant is in his/her own group.

My understanding is that HCEs need not get a gateway. However, if the plan is top heavy and they are employed on the last day, they must get 3% to satisfy TH min. Does then require them to get 5%? I would think not.

Thanks.

Howdy all,

With the 2011 form not released yet, are others using the 2009 form or are they going to wait for the 2011 form? Internally we have to different arguements. Some say wait and others just want to get the form our the door with the 5500. Any opinions by others would be helpful.

Also, does the IRS have any offical guidance on what to do when there is no current form to file?

Thanks,

Frizzyguy

Having purchased everything we needed to file the 8955 SSA, and having produced lovely-looking paper copies, we have been unable to file electronically. ATX says that we are unable to do so. (I don't know why--I am not the one pushing the "send" button.)

1. Does anyone have any positive experience filing the 8955 electronically using ATX software?

2. Given that today is the deadline and assuming that ATX is no longer an option, can anyone suggest an electronic Plan B?

3. Failing that, is there a paper Plan B option?

Any suggestions gratefully received!

Does anybody know how to switch from Daily Valuation to Balance Forward during a Plan Year(2011) My firm was using Daily Valuation until March 2011(they outsourced this to another firm to do the Daily admin) I have gain losses and contributions that posted until March 2011, and need to reverse them?

The Final 415 Regulations allowed employers to choose whether or not they would include salary continuation payments for participants on military service in the definition of compensation. When the HEART Act was passed, it required that employers count differential wage payments as plan compensation. Are the terms "salary continuation" and "differential wage payments" being used interchangably for this purpose? In other words, is the purpose of HEART to override the 415 language? I know that salary continuation could be something different than just paying the difference, but are these 2 provisions really addressing the same thing, or 2 different issues?

Thanks!

UPDATE - I found the response to my answer in an earlier post.

Hi - I am picking up a plan that has (1) self directed investments for 401(k) accounts (at John Hancock); and (2) Trustee Directed ("pooled") investments for Profit Sharing Contributions. Participants may not elect to self-direct their profit sharing accounts.

If the plan were entirely Trustee Directed, it would be exempt from Participant-level disclosure requirements. However, given that part of the plan is self-directed, does anyone know whether the pooled account becomes subject to participant disclosure? {Remember, participants DO NOT have a choice about investing in the pooled account. They cannot self direct profit sharing funds; and they cannot elect to invest 401(k) accounts in the pooled profit sharing account.}

I'm thinking the pooled account is not 'Designated Investment Alternative' (DIA), but I can't find anything on point.. What do you think?

Thanks very much.

An illegal alien with false documents was hired in 2006, and starting participating in the profit sharing plan in 2007. His illegal status was just discovered, and he has not returned to work. The Employer does not want to pay him any pension benefits, because he was hired and participated under false pretenses. Only discretionary Employer Contributions are in the plan. Is there any authority for forfeiture of the account and reallocation to remaining participants?

Does anyone have some insight into what to what is meant by the following language in 1.409A-1(b)(5)(iii)(A): "Except as otherwise provided in paragraphs (b)(5)(iii)(B), ©, and (D) of this section, the term service recipient stock means a class of stock that, as of the date of grant, is common stock for purposes of section 305 and the regulations thereunder of a corporation that is an eligible issuer of service recipient stock (as defined in paragraph (b)(5)(iii)(E) of this section). Unless I'm missing something, I can't find anything in Section 305 or the regulations thereunder that helps define common stock.

I prsume this is an easy one for you TPA types . . .

Say a DC participant has a $100,000 account balance, $30,000 of which represents an outstanding loan. Participant terminates employment, and requests a rollover of the remaining $70,000. $6,000 mandatory withholidng (20% X $30,000) is taken from the $70,000, so that only $64,000 can be rolled over--correct?

Are people filing their SSA extensions whether or not one is due? Of course the issue is that we probably don't know if one is due because if we did there is a good chance we would have filed by that date.

I know that, before the association with Linkedin, the ASPPA practitioner forums didn't draw much activity ; and I'm also aware that communicating via social media is a "now" thing and we sometimes have to break out of old grooved tracks and embrace the new ; but I also think that in some situations "old way" is better than "new way" ; I've been going back and forth between Blink ,Actuarial Outpost, ACOPA, and ASPPA's Linkedin group and I have to say that I like the visual presentation of the others better than Linkedin.

For this benefits professional/practitioner seeing a great many questions and topics together on the screen is preferable to seeing someone's picture with a question and only seeing a few questions per screen ; the search features of the other forums are also better and obviously designed for topic research.

And yes I do have a FB account and now also a Linkedin account because I like ASPPA - but I don't think a social media approach is an efficient one in this case.

Would be interested to know what others think ?

Deleted because client objected to information being posted.

Thank you anyway.

S.

Generally when calculating eligible income for Self Employed, 1/2 of the social security tax and 1/2 of the medicare tax are subtracted - which would normally be 6.2% (up to TWB) and 1.45%.

2011 had a 2.0% tax cut for EE's, so the Self Employed ended up paying 6.2+4.2=10.4%. Would we then take half of that, or 5.2% for calculating eligible earnings?

We have a client with approx 75 Participants. The owners have acquired another company and they want to write a new plan for that company (approx 75 participants in the new company). Do we need to aggregate the 2 plans in determining whether or not they require a Plan Audit?

Thanks

I am wondering how the involuntary cash out limits are calculated. Is the lump sum value reduced to a present value at the participant's date of termination or when he would reach NRA? The reason I am asking is b/c I want to know if it is even possible for a $179.50/month benefit payable at age 65 could possibly be under the $3,500/$5,000 amount. The participant terminated from the employer in 1987 and he reached 65 in 2010.

Thanks!

Dad owns 100% of a Barber Shop.

Dad and Son each own 50% (exactly) of a rope-making business (not related to haircuts). The son is over age 21.

Controlled Group? I think not, as long as the son owns 50% (or more). Assumes no rights to buy stock or any other such oddities.

Adult Child Attribution: If an individual has a child (or a step-child if the individual had adopted such child) that is age 21 or older, the child’s ownership interest in a business is attributed to the parent, but only if the parent owns more than 50% of the same business. To determine the 'more than 50%' ownership, direct ownership plus any other ownership attribution must be included other than the “adult child attribution”. Likewise, if the child has a more than 50% ownership interest in a business, then any ownership held by either of the child’s parents in that same business is attributed to the child.

Confirm?

Parent Co buys the assets of Small Co. Small Co has a 401k plan which it will terminate. Paren Co allows loans anjd would like to let the two or three people with loans to roll their loans into the new plan. Do I need a plan amendment to allow this? What sort of paperwoirk is required from the participant to make such an election?

I’m working on populating the census and need to know if the “gross income” should include domestic partner health insurance premium benefits paid or not. It’s included in taxable income for employees receiving domestic partner benefits but didn’t know whether we included - the plan document is not clear? Thanks ahead of time for any guidance!!