I am establishing an 81-100 group trust. Can someone point me to a resource where I can learn the specific audit/5500 requirements both at the trust level and the individual plan level?

I have a client that currently sponsors an ERISA 403(b) with an employer match and one investment provider. If they decide to eliminate the matching contributions to the plan prospectively, can they now be considered a non-ERISA 403(b)? If so, would they need to restate their current document (a volume submitter doc) to a non-ERISA 403(b) document?

Any advice or information would be much appreciated!

ETA: Will also want to allow for multiple investment providers going forward.

As a result of the changes under the Health Care Reform Act, I need to make sure I am am up to date on the following:

Can the expenses for exercise classes/gym membership be reimbursed from an HSA account if the doctor prescribes due to obesity?

A claim will first be filed with the insurance company to see if they will pay for all or part of it.

If a balance remains after the insurance processes, can it be filed under her HSA?

I would appreciate any guidance in this. Thank You

I am trying to decipher the methodology for calculating earnings for an SCP. The issue is that the ER failed to follow terms of the plan as it relates to deferrals on bonus payments.

My predecessor asked for rates on:

the Plan's default fund (which happens to be a TDF so there are multiple rates)

Money Market Fund

the experience of the plan as a whole

experience of the highest HCE for the plan year

I am curious as to where he came up with these? I don't see them in the RevProc. Also, if these are the rates I should be looking at, do I have to go with the highest rate of the 4 options above? I thought that App. B, Section 3.01(3)(b) would be applicable and I would only have to look at the rate of return for the fund with the highest earnings rate for the period of the failure since the corrective ctrb is going mostly to non-HCEs?

Thanks!

We export a COBRA file to our TPA via ftp every two weeks. This week, we received a phone call from a former employee asking when she would receive her COBRA information. We verified that she was on the export file, then contacted the TPA and asked when her paperwork would be mailed. We were told by our TPA that they had not received any files from us since October! :angry:

I sent the TPA a screenshot of the ftp site showing the dates/times all of the files had been uploaded. They then admitted they had made a mistake, sent notices to all QBs that day, and are refunding our service fees for November and December.

I know that we have 44 days from loss of coverage to notify QBs. We are okay with the November and December terms because they all fall within the 44 day limit; however, there were approximately 40 in the October exports that are outside the 44 day limit.

I know that, as the employer, we are ultimately responsible for the actions (or non-actions in this case) of the TPA. What penalties do we face for this error made by our TPA?

Thank you.

Our company contributes to the HSAs of employees who elect medical coverage under the HDHP. All HSAs are set up at one specific bank, and company policy is to make the employer contributions only to HSA at that specific bank. Occasionally the bank refuses to set up an HSA for certain employees. The bank won't divulge specific reasons for these refusals, but we understand that this is generally related to the employee's credit history. The question is, is there any way to classify this as a status change event allowing the employee to elect a different medical plan?

Mjichigan now has tax withholding on distributions.

First question, Everything I have read says that monthly payments are now subject to mandatory withholding. Does anyone know if lump sum payments are subject to mandatory withholding?

Second question: Is there any de minimus?

Hard Plan Freeze for DB

no Unrecognized prior service cost or transition asset/obligation

Unrecognized net loss= $4 million

Decrease in PBO due to curtailment = $3 million

do we reduce the $4 million loss by $3 million, resulting in $1 million unrecognized loss after curtailment?

Thanks

Cash balance plan has just been frozen. 401(k)/PS not frozen. Top heavy has been provided in the 401(k)/PS. Keys are deferring at least 3%.

With the DB frozen, does the 5% TH allocation requirement change to 3%? If so, where is that cited?

At what point do you determine the vesting % for an ACP corrective distrubtion of an excess aggregate contribution?

1) At the date of distribution?

B) The end of the plan year for which the excess was contributed?

III) Something else?

TIA!

A client just received refunds from insurance carriers in New York. NY Insurance Refunds"]NY Health Insurance Refunds[/url]

Any thoughts on how these items should be treated by the employer?

Thanks.

Can anyone explain the individual notice requirement under 8955-SSA that requires notice of any benefits that are forfeitable if the participant dies before a certain date (See IRC Section 6057(e))? What would be an example of such an occurrence?

Cross-tested PS only plan fails a4 testing. Owner 50. Three employees ages 55, 63, 23. Need 2 ees with higher EBARs than the owner if all employees tested together.

Can I restructure into component plans:

A) owner, two employees ages 55 and 23 on benefits basis

B) 63 year old employee on a contribution basis

Thanks for any input!

It is 1/5/2012 ....... Can an employer amend their Safe Harbor 401(k) plan effective 1/1/2012 to go from a 1 yr plan eligibility to an immediate plan eligibility effective immediately or would they need to wait until the 2013 plan year.

Thanks

Situation is following: plan provides for deferrals, 3% non-elective safe harbor, and a cross-tested profit sharing plan. Safe Harbor is provided to all participants. Daughter of owners now eligible for plan in 2011. She is in her own class for the PS component; unfortunately she is by far the youngest participant (HCE and NHCE) so testing is a problem.

Usually when running Ratio Percentage, Non-Discriminatory Classification and Gateway testing have aggregated the SH and PS contributions together. Generally is more favorable result and usually provides for lower Gateway contribution since can take into account the SH component (say if 3% SH, 12% highest PS allocation to HCE, then aggregate Gateway for NHCEs would be 5% - 3% = 2% PS to NCHEs; if ignore SH, Gateway PS would be 4%). However this young HCE is killing things.

In looking at 401(k) final regulations, see following in 1.401(k)-3(h)(2):

Use of safe harbor nonelective contributions to satisfy other nondiscrimination tests. A safe harbor nonelective contribution used to satisfy the nonelective contribution requirement under paragraph (b) of this section may also be taken into account for purposes of whether a plan satisfies section 401(a)(4).

I focus on that all-important word "may" in the preceding. Would it be permissible to run my Cross-Testing in this situation by only taking into account the Profit Sharing contribution for ratio percentage, non-discriminatory classification and gateway testing (Average Benefits Test would of course include all sources: deferrals, Safe Harbor, and Profit Sharing for the 70% of HCE <= NHCE average) or am I reading into "may" too much here? Don't have a problem with providing a higher PS contribution for gateway by ignoring Safe Harbor as initial results were horrible.

Any thoughts?

The IRS has not posted the funding segment rates for a valuation beginning in 2012 (specifically 1/1/2012).

Is it posted somewhere else for 2012?

Prior years are found here

http://www.irs.gov/retirement/article/0,,id=174520,00.html

line 6a says report those REQUIRED to be reported

line 6b says report those Voluntarily reported

line 7 is the sum of two.

ok..... the instructions say for line 6a provide " the total number of participants entitled .........under the plan in 2009 AND WHO WERE NOT REPORTED ON THE 2008 SCHEDULE SSA." What about those coded "D"? They were reported on 2008 as "A" and will now be reported on 2009 8955 as "D" -- SHOULD THEY BE COUNTED HERE?

I really want this line 7 number to match the number of participants reported -- regardless of the code -- but that is really not what the instructions say. PLEASE HELP!

Does anyone have any experience with filing Form 8928 to report COBRA failures and to pay excise taxes? Has anyone requested a waiver of excise taxes?

This is outside my practice expertise.

Doctor owns 100% of an S-corporation. Doctor is an HCE with respect to the S-corporation, his salary averages about $400,000 per year. S-corporation provides medical services (dermatology) to patients. S-corporation has a 401(k) plan. S-corporation has additional employees.

Doctor's spouse owns 100% of an LLC. LLC is taxed as a sole proprietorship. LLC is engaged in the business of providing clinical trial studies to independent, unrelated, third party drug companies. The LLC hires the Doctor as an independent contractor to perform the study. The LLC has no employees and the spouse will have self-employment income equal to the LLC's profit.

Spouse is not an employee or officer of the S-corporation, and the Doctor is not an employee or officer of the LLC.

Spouse desires to have a solo 401(k).

The S-corp and the LLC do not provide services to each other, but the LLC does provide services typically performed by dermatologists (clinical trials).

Does this structure work under the affiliated service group or controlled group rules, including the relevent attributions rules?

Thanks in advance for any guidance.

-Alan S.

Folks,

Incredibly useful site. Would appreciate any input one can provide on my situation.

I am in a very fortunate situation of having two employment contracts with distinct employers and sizable self-employment income as well. I am prone to save as much as possible in retirement plans, mainly to achieve as much tax deferred investment as possible. Thus far, I have the following plans established:

1) Employer 1 (<100K income): 403B. I contribute the maximum (was 16,500, now 17,000) and my employer contributes ~20K (capped at this for my age group).

2) Employer 2: 401K, to start this upcoming July, 2012 after 1 year of service. I can contribute $17,000 to this with a full match to 49 or 50K (whatever the maximum is). I assume I will have to cease contributing to my 403B with my other employer so as not to exceed maximum employee contributions across plans.

3) Employer 2 also offers a 457B, to which I have not started contributing, but would like to. I assume I can make these contributions exclusive of the 403(b)/401K contributions (I will not be contributing to both the 403 and 401K starting July 1)? Is this assumption correct?

4) Self-employment: I have established a defined benefit plan for myself with target income of ~130K at age 62 and contributed ~100K for 2011. Actuarial assumptions not available for 2012.

5) I also contribute each year to a non-deductible traditional IRA for me and my homemaker wife, which I assume I can make.

Are my assumptions correct for the above scenario and am I taking maximum advantage of retirement plan contributions? Am I overlooking anything or in violation of any IRS rules? Any advice you sages can provided would be most appreciated.

Many thanks in advance!

SR