It would make sense that the spouse could get her 36 months of COBRA under the participant's Employer Retiree Medicare Supplemental Plan, even though the participant does not now have COBRA rights. But is there any direct authority for this proposition? Thank you for the feedback -- in advance.

Most of the providers in this category solely provide retirement/investment advice only and don't provide advice for all other financial concerns of participants such as spending plans, debt management, educational savings planning, insurance planning, and any other goals-based planning important to them.

That said, would anyone think that if such a solution truly covered all these topics and serviced participant questions with Certified Financial Planners, rather than TPAs taking these calls, that participant utilization of the service would skyrocket over the dismal industry average of just 2% - 2.5% annually?

Moreover, since all financial topics could be covered by this service, wouldn't it stand to reason that this service would significantly contribute to the financial wellness of the participant, consequently reducing the corporate time participants spend on their own financial problems, thereby improving the sponsor's bottom line with increased efficiency?

We are interested in your opinions as this is what we do and are passionate about. Thank you in advance for your interest and taking the time to respond.

I have a plan where the HCE is deferring .46% and the NHCE's are not deferring. Wouldn't this test pass since it's under the 2% threshold?

I am working on a disclosure for fas158 for a SERP as of 12.31.2010. A new participant will come in the Plan as of January 1st (the day after). Do we need to recognize that in the 12.31.2010 disclosure or do we have a choice?

Husband and wife with separate businesses who would ordinarily satisfy the "non-involvement" clause, but are considered a CG due to community property state, now move to a non-community property state. Presumably this takes them back out of CG status - just wondered if anyone had a different opinion? Thanks.

P.S. - this brings another question to my mind unrelated to CG status. When you have a corporation in one state, if you move your business to another state, do you have to do new articles of incorporation or whatever in your new state, or do all states recognize corporations incorporated in another state, etc....?

Employee has done salary deferrals throughout 2010 and employer has matched the deferrals (formula of 100% up to 4% of pay). Employee has $52,000 in wages and $16,500 in deferrals. The safe harbor formula match is $2080 (4% of $52,000). However, the employer has contributed a match of $9,202, resulting in an excess match of $7,122.

What do I do with the excess match?

The excess contributions on a failed ADP test are $2.00 and $5.00 before an earnings allocation.

Must these excess contributions be distributed, or is there a deminimus amount which you don't have to distribute?

Traditional (k) Plan. No compensation exclusions for deferral, match and profit sharing. No accrual provisions for either match or profit sharing. I will hold to the theory that I cannot amend the definition of comp for match or profit sharing for the current plan year. However, is it possible to amend the comp definition for the salary deferral contributions during this plan year? Bonuses are paid to the employees at the end of the year, and the client for whatever reason would like to exclude the 2011 year-end bonuses from the deferral portion of the plan. Can this be done, or is the right to defer on the entire gross wages a protected benefit in the plan? Thanks.

Plan fails ADP test. (otherwise excludables have been taken out of the test).

must the corrective QNEC go to all eligible NHCE employees or can you exclude the "otherwise excluables" from the corrective QNEC?

Document says match is discretionary and annual counting deferrals up to 3% of comp. They were depositing monthly 100 cent on the dollar counting deferrals up to 3% of comp. In prior years, every year I would always do a true up at year end to comply with the doc.

In June of 2010, they stopped depositing the match because of cash flow problems. I'm looking at doing the true up now and I have a question.

Do I bring everyone up to the highest HCE which is 1.77%

or

Do I bring everyone up to the 3% received by one NHCE that left employment in March of 2010?

The doc does not have last day, 1,000 hours or any other allocation conditions.

Section V.B.3 of 2008-113 provides that amounts which are repaid in correcting a mistaken payment may be deducted in determining AGI.

On what line of the Form 1040 is this deduction reported?

I have a client that has paid a few invoices in 2010 related to valid plan expenses out of company money. The plan has some money in the forfeiture account that can be used to pay for plan expenses.

Can the ER use that money to reimburse itself for the expenses? The money was in the forfeiture account at the time they wrote the checks.

Plan is Top Heavy in 2011 due to a participant being a Key in 2010; this participant is not a Key in 2011 - can he defer in 2011 as a non-key or will be still be considered a Key in 2011? Thanks.

A client with a calendar year plan is contemplating terminating his plan effective 9/30/2011. When discussing the possible plan termination, the client wasn't happy that terminated participants would become 100% vested.

Now a terminated participant has resurrected herself and is adamant about rollingover her balance asap. She terminated in 2009, and is 40% vested.

Then she actually posed the question, would she get more vesting if she waits.

Since there is no plan termination amendment to vest her 100% and no guarantee the plan will terminate, do I proceed to process her distribution and forfeit the balance? or tell her to wait?

If one converted traditional IRA into Roth IRA in 2010 and opted to report conversion income in 2011 and 2012, is it still possible for him/her to convert more in 2011? If it is, how is this additional conversion (done in 2011) to be reported?

Company A is a sole proprietor, no employees, and sponsors a solo 401k.

Company A wants to buy Company B, which sponosrs a 401k plan with employees. The surviving plan will be Company B's plan. Owner of Company A would like to get his money into an IRA account before he buys the other company. The closing is scheduled so this is all basiclaly a sure thing.

If he terminates his plan (i.e., Company A's Plan) and rolls his balance to an IRA before he acquires company B, will his rollover be deemed ineligible for rollover?

One way or another we have always seemed to find the missing participants on our PBGC covered plans. However, that streak may be about over.

I have plan with 5 potential missing participants but we have NOT yet done a publich search for them. Does anyone know of a good public search company (or two) that you have had sucess with in the past. I believe we cannot escheat the money to the PBGC as part of their missing participant program unless/until a publich search has been completed.

Any names would be appreciated. Thanks in advance.

Does anyone have a sample correction letter to show me, such as an election form that is sent to the client getting them to authorize the correction method (refunds/qnec)?

hi,

a one employee S-Corp is wanting to put $30K in a SEP.

1) Can an S-Corp have a SEP

and

2) Does the contribution reduce FICA taxes the participant has to pay?

The owner of my company is requiring me to prepare and send some different pages and a new SPD to a client (asking them destroy the originals). This is to make up for a mistake we made, actually a mistake the owner made, when the plan was restated and signed last year. So, this is not an amendment to the plan. These pages affect the participant's benefits for last year (negatively). Do I refuse, and if that will not suffice, resign my position?

Never thought I'd be here to post anything, but ASPPA provided no response from this question sent a month ago, so welcome to Benefitslink?