If a healthcare FSA participant has a 24 year old son living and working in another state and the son is not a dependent for tax purposes, but would be considered an eligible dependent under the new changes with healthcare reform, could the FSA participant pay for the son’s new eyeglasses with FSA dollars?

I feel that the old ruling stated that eligible expenses had to be incurred for the participant or a tax dependent. However, once the new HC reform kicks in, I feel like this senario would be acceptable. Is that the case?

Thanks!

I will begin by saying that I am on the payroll, not benefit, side of things. Our 401(k) plan is going through the annual audit. Our last payroll of 2009 was paid on 12/31/09. We uploaded the file to our 401(k) TPA's website on 12/30/09, the same day we processed the payroll. Our TPA is responsible for initiating the ACH to our bank account to fund the contributions. They always take a few days to do this, so the ACH was not initiated until January 5, which is the day they credited the contributions to the employees' accounts. They are showing these contributions as belonging in 2010. Our auditors are now telling us that because of the mismatch between what we show on W-2s and what our TPA shows for the year, going forward we should not process any payrolls late in the year that our TPA cannot post within the same calendar year. Does this make any sense? Is the TPA required to show the contributions as belonging the year in which they received the funds from us? Or is this an error on their end?

do you consider negative investment returns for the entire investment portfolio when calculating lost earnings?

Two of our clients had employees in the past, but now the plans

cover only the owners(s). Plans are either sole-proprietor or partnership.

All previous filings have been small plan Form 5500. All previous participants,

other than owners, are terminated and their plan assets distributed.

Since the plans now are considered "one-participant" plans, can we switch

to filing 5500EZ?

If the answer is yes: Is a "final" Form 5500 required before filing the first 5500EZ?

Thanks.

lets say the plan has a non statutory automatic deferral provision (not a QACA or EACA). the participant with no elections on file takes a hardship distribution. do you resume the automatic deferrals at the time the participant is eligible to defer again if they continue to have no elections on file?

this one seems to be working fairly well, I haven't had any major problems with it over the years and found it useful.

this is another of my 'screwball' reports, that I have finally been able to update to look like something

basically, its a Summary of Accounts Totals only, but in a format designed to look like the 5500 SF.

Needed something so others here could fill in the account data portion on the 5500 without my help.

There are a few user defined fields I use to track the suspense account, but I think this should work even if you run a 'dummy employee' instead (unless you are using the user defined fields for another purpose)

ok, maybe you have to adjust distributions if you have corrective distributions, but at least it looks something like the actual 5500, and no one has a gun to your head forcing you to use it.

I was hoping somebody could help detail out all of the negative tax implications of the following situation:

In June of 2009 Participant has a current Loan Balance of approx $18,000 and participant takes a loan withdrawal of $62,000 and refinances his loan to $80,000 for 5 yrs. In December of the same year, participant takes out another approx $23,700 and refis up to $100K.

Couple items to note: For the original loan, and at the time of the first refi, the highest loan balance in the previous 12 months = approx $22k. Also, the participant is of retirement age.

I appreciate yor help!

If a 125 plan were to be amended to remove OTC items from the eligilbe list of reimbursable items to make administration easier would OTC items that participants have received a prescription for be reimbursable as a "prescription" or would these items always be considered "OTC items" regardless of any prescription they may have received, thus making the item ineligible for reimbursement?

I have read several articles that imply that many Employers are electing to remove OTCs all together to limit any potential problems with the determination of what are "drugs" and what are "Medicines" under the new regulations. Are a lot of Employers or TPAs removing OTC items all together?

Self-employed sponsors a retirement plan. Plan has been in existance for years. I found out today that the self-employed has another separate sole proprietership. The plan document is non-standard; the self-employed doesn't benefit and there aren't any other hce's so coverage testing not an issue.

The issue is whether we the seperate business can be exlcuded just not having adopted the plan? Generally that is the case, but can a self-employed really have 2 separate sole-proprieterships?

Thanks in advance for any guidance.

If a plan has its assets in a pooled account, and participants take loans, does the interest get paid back to the trust as a whole, or do we need to separately account for the interest per person who took a loan?

Is it possible to revise payment formula for amounts that have not yet been earned? For example, consider a nonexempt SAR having a present intrisic value of $100. Is it permissible to amend formula (with participant's consent) to impose a maximum payout that's some amount greater than $100? On one hand, participant has a LBR to future appreciation, but on the other hand the change would only affect a right to value that hasn't yet been created. Thoughts?

DC Plan has a 1-year service requirement for elective deferrals, and a 2-year service requirement for fully vested employer contributions. Plan is top heavy, so N-Ks receive the TH minimum if they have satisfied the 1-year service requirement, even if they haven't satisfied the normal 2-year service requirement for employer contributions. Does the minimum gateway have to be made for N-Ks who receive a TH minimum but haven't satisfied the 2-year service requirement for regular employer contributions? Yes, they "benefit" under the Plan by virtue of the TH requirements, but it doesn't seem logical to require that they receive more than the TH minimum.

Participant termiates, is later rehired. Under the plan document this participant is immediately eligible. Plan has an automatic enrollment feature. If the participant doesn't make a new salary deferral election should that participant be automatically enrolled? My inclination is yes, but I don't see it specifically addressed in the plan document.

Thanks in advance for any guidance.

Let's say a participant's high 5 of last 10 for his Average Monthly Comp is currently $50,000. The participant continues to work for another 10 years at a much lower comp rate so upon termination high 5 of last 10 is $25,000. His/her final accrued benefit is calculated using the $25,000, correct? The plan defines AMC as high 5 of 10 Years of Service where Year of Service is defined as 1,000 hours worked.

Help no longer needed. If you need help and the facts are the same, please feel free to send me a personal message and I'll do my best to walk you through this mess.

Facts:

-- File 2009 5500-SF for Defined Benefit Plan. I will be submitting in behalf of client.

-- Have applied for signing ID

-- Am using Relius IFILE xml export

-- Have passed Relius validation

-- xml successfully inported into efast without error but shows "in progress"

Ouch:

-- I have looked at xml file and even though client signed copy of first two pages of 5500-SF was added in Relius, file does not appear in xml.

-- When I get to efast website, I don't see in drop-down menu where to add attachments.

-- I spoke with the DOL who referred me to 130 page manual which I was unable to search for answers.

Plea for Help:

Would sincerely appreciate it if someone who has successfully filed a DB 5500-SF via IFILE would send me a personal message with a telephone number. Would appreciate being walked through process.

Help no longer needed. If you need help and the facts are the same, please feel free to send me a personal message and I'll do my best to walk you through this mess.

Facts:

-- File 2009 5500-SF for Defined Benefit Plan. I will be submitting in behalf of client.

-- Have applied for signing ID

-- Am using Relius IFILE xml export

-- Have passed Relius validation

-- xml successfully inported into efast without error but shows "in progress"

Ouch:

-- I have looked at xml file and even though client signed copy of first two pages of 5500-SF was added in Relius, file does not appear in xml.

-- When I get to efast website, I don't see in drop-down menu where to add attachments.

-- I spoke with the DOL who referred me to 130 page manual which I was unable to search for answers.

Plea for Help:

Would sincerely appreciate it if someone who has successfully filed a DB 5500-SF via IFILE would send me a personal message with a telephone number. Would appreciate being walked through process.

A plan sponsor had a 401k safe harbor basic match and profit sharing plan for 2009.

They issued the 401k safe harbor basic match notice for 2010.

In August 2010 they implemented a new 401k safe harbor profit sharing successor plan and a db plan.

They intend to terminate the old 401k plan.

It seems that the new 401k plan can not be a safe harbor for 2010 but can be for 2011.

The 2010 safe harbor can only be in connection with the old 401k plan.

Are we in agreement with that?

And finally can the match (which is contributed after the plan year in 2011) now be contributed to the new 401k plan even though it is based on the original 401k safe harbor?

thanks

Under the plan asset rules there are certain plan investments in entities cause the entity's underlying assets to become plan assets. If it were the case that the plan asset regulations caused the underlying assets of the entity in which the plan had invested to become plan assets and the entity had many subsidiaries, would the assets of the subsidiaries (1st tier, 2nd tier, 3rd tier, etc...) also become plan assets? I cannot find any interpretation of the phrase "underlying assets of the entity." It seems that assets would include all property-including interests in other entities (like subsidiaries). But it seems ridiculous that the plan asset rules could pull the property of many subsidiaries in a huge chain of companies into an investing plan's assets.

Any help?

Company A has a Simple IRA.

Company A owners bought assets only of Company B who had a 401(k) Plan that was not part of the assets purchased/

Can a Simple plan be set up 10/1/10 for Company B with immediate eligiblity (Company A is not immediate)?

How do the limits work between what they contributed in the 401(k) and if they can have a Simple IRA?

Any same desk rule?????

Thanks

Pat

Looking for a case that holds that a retirement application is a plan document for purposes of ERISA. If you know of scuh a case, please pass along name and/or citation.

Thanks