The client is under Cycle E, so I'm getting ready to submit the ESOP. I'm thinking I probably need to get his individually designed DB plan submitted again, too. Is that right, or do I have more time for that one?

For a client, we are trying to confirm the post-PPA timing rules for employer contributions under a money purchase pension plan since IRC 412©(10)(B) has been eliminated. We looked up the chapter on defined benefit funding rules in "RIA's Complete Analysis of the Pension Protection Act of 2006" and found some interesting observations. Basically, the "minimum funding standard account" under IRC 412(b) was eliminated under the PPA. Because the minimum funding standard account was eliminated, it appears as if the timing rules that applied to the minimum funding standard account were also eliminated. Accordingly, the only timing rules that remain with regard to employer contributions under money purchase pension plans are those under IRC 404 (i.e., not later than the time prescribed by law for filing the return for such taxable year) [iRC 404(a)(6)].

We weren't able to find any other commentary or discussions on this out there, so I was hoping someone else out there had some insight or could confirm. Thanks in advance!

403(b) Plan's at TIAA tend to have about half of their account balances allocated to terminated participants, none of whom have been reported to SSA before. So now we need to report the new people who terminate on the SSA, I assume? Here's the tricky part, as people take distributions, how do we know which of the sea of people were previously reported on the SSA??

I know we haven't even made it to the 15th but was wondering what I should be telling my 403b clients for whom we're delivering a form 5500? Will there be a follow up for the SSA?

New client wants to offer a Brokerage Account (managed) to the participants in the plan. The minimum account balance is $25,000 for this type of account.

Is this discriminatory? Do I need to test this 'feature of the plan'?

Thanks

PS Plan with a 7/31/10 PYE. The plan has a 1000 hours requirement but no last day requirement. SS integration used for PS allocations.

Q1: Can the 7/31/10 plan year be amended after 7/31/10 to allow for new comp? There would be 2 rate groups, one for owners (all HCE) and one group for everyone else. If permissible after PYE, what is the deadline to make the amendment (is it 2-1/2 months after PYE?)

Q2: If it is too late to amend the 7/31/10 PYE. could we amend the 7/31/2011 PYE now (10/2010) before anyone has 1000 hours worked in the current plan year?

Q3: Performing a 180, could we amend the 7/31/10 to pro-rata now (after 7/31/10)? doing so would only "hurt" the HCEs since it would take a greater overall PS contribution for them to achieve what they would have received if SS int was used?

Thanks for any comments.

Relevant Background Information

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One owner plan - DB Plan with insurance (Incentive Life. He is 67 yrs old and terminated the plan. He wants to buy the policy outside of the plan and change the ownership from the plan to himself. I received the Policy values (PERC values). There seems to be a discrepency between the IRS and DOL on what to pay to the plan to buy the policy outside of the plan.

Specific Question

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The DOL says to use the cash surrender amount to pay to the plan and get a 1099 for the difference between the cash surrender amount and the perc amount. The IRS says the PERC amount is the amount owed to the plan.

Which one is correct?

Cash Surrender amount is $25,864.74 and the PERC amount is $68,313.00

Hello,

We have a client with fewer than 10 employees that currently has a health plan 100% paid by the employer. The employer would either like to make the plan 100% employee paid or terminate it outright.

Does anyone one which one would be easier adminsitratively? Also, what employee notices/disclosures would the employer need to provide?

Thanks

IOn Rleius, there is an attachment for Accountants Opinion, which is where we are putting the audited statements. When we do this, we get no validation errors.

But there is also this:

"financial statements used in formulating accountant's opinion"

What the heck is that??

I am trying to complete a 2009 Schedule SB for an Eligible Charity Plan, which as such is on a delayed PPA effective date so is now under pre-PPA funding rules. SB instructions say enter "1" on line 27 and only complete certain sections of the SB while attaching a 2007 Schedule B marked up for 2009 data. When we enter our lmited Schedule SB info, we get about 10 errors saying "missing or invalid entry" for items that are not required to be completed per the SB instructions.

If anyone else is completing the Schedule SB for an Eligible Charity Plan, are you having this problem and if so, do you have a solution. Thanks.

About a week to go here.....everyone on track? I see some posts about extending the deadline and was just curious how many of us actually feel like we need the extra time?

Client needs to make a contribution for a person for whom an IRA account was not set up. The person is no longer an employee and cannot be located. We are getting push-back from IRA custodians on the employer trying to set up an IRA account for the individual where the person is unavailable to sign. What has been your experience. If you've found an IRA custodian willing to open the account without the employee's signature, what custodian did you use? If you've been abler to convince a custodian to open the account, what arguments/citations did you use? Thank you for your assistance.

Can we legally allowed to cashout out Roth balances along with pre-tax, and how they would be treated. for example, as a combined under 5k or separate balances? Is there anything in the Regulations or code that speaks to involuntary Roth cashouts?

I was on a conference call yesterday that implied that some organization (I think perhaps the AICPA) has again petitioned the DOL to extend the 12-31-09 Form 5500 filing deadline to 12-15-2010. Has anyone else heard that?

Are we legally allowed to cashout out Roth balances along with pre-tax, and how they would be treated. for example, as a combined under 5k or separate balances? Is there anything in the code that speaks to involuntary Roth cashouts?

This qualifies for Ripley's believe it or not. We just had a bunch of 5500 forms bomb yesterday, for lack of proper credentials. So when the clients finally got a live person at the DOL, the clients were informed that the credentials had been deactivated because the clients hadn't used them!!!

The clients just applied for and received these credentials this year, and we haven't even reached the first extended filing date!

My theory is that there is a major conspiracy between the drug companies and the DOL, and the DOL receives illegal kickbacks on the sale of blood pressure medication. But I do know that whatever mentally arthritic people at the DOL are responsible are very fortunate that they are not within my arm's reach right now.

I have attached the signed pdf. form 5500SF, all looks good, however, when I go to e-file-> I am use the 'sign as preparer'.

Once I do this I check the box on the plan admin line and enter my credentials do I also change to my name or leave the true plan administrators name? From reading the directions I think I leave his name but use my credentials... Please let me know if I am on the right track.

Thanks for the assistance (and hope for a blanket extension)

Back in 2007/2008, the IRS released something that used the word 'deference' which we found out later really meant 'prove it'.

A prospect that still has their NRA of 55 in their document now, is concerned that they don't have a study that proves that their normal retirement age is typical for their industry. The plan allows for in-service at Normal Retirement Age.

How would you suggest fixing this?

An accountant says new regs require health premiums paid by/for sch c filers must now be on the sch c, where before they were deducted on the 1040. The result is lowering comp for any retirement plan purposes.

Anybody heard anything about this?

Stockholders are required to terminate health plan immediately before they sell their stock to a purchaser that is part of a controlled group. There are no other health plans with the sold company (or any member of its controlled group) after the termination.

The terminated health plan had COBRA participants.

The purchaser will provide health coverage to the employees of the sold company once the stock purchase is completed - these employees will have no gap in coverage because immediately after the health plan is terminated, they will be covered by the purchaser's health plan.

Q: Will the COBRA participants of the terminated plan be cut off and not have COBRA coverage under the purchaser's plan?

Suppose there is a gap in coverage of a full day, or a week, or a month? Does that make a difference?

Need to file a sched c for a new union client. The 5500 is coded as a 2c for the 2008 5500

They have all types of expenses coming out of their plan. Some of the expenses are

-insurance

-payroll

-rent

-telephone

-office

Do these expenses have to go on the Sched C??

Thanks in advance.