say we have a non erisa 401k profit sharing plan where only a husband and wife participate.

say the plan is self directed non 404 c plan.

say each participant defers 16k for 2010 for a total of 32k in plan.

say they want to make an investment where they loan a non interested party 30k with say a 5 year terms with interest and principle, much like a plan loan to a participant.

Since it is a self directed plan i presume this could be accomplished if each participant agrees to loan 15k to the unrelated party.

If it were non self directed i presume plan could just write a 30k note.

is this a reasonable investment/transaction? I see no problem with it.

Thanks.

to my knowledge a roth ira cannot be rolled into a defined benefit plan (or a profit sharing plan for that matter). Is that correct? I realize it makes no sense to roll a roth into a qual plan but some people seem to think it is a good idea to roll into a qual plan for protection against crediters.

thanks

We are a TPA firm who has been asked if we could recommend an administrator for a 403(b) plan. We do not administer 403(b)'s as they are a little different from 401(a) plans and we already have too much to do with what we have. Apparently they are a local college and have been administering it themselves.

If there is anyone in the Southern California area who would be interested in this?

If so, let me know.

Although I haven't done it before, I guess you can send me a private message.

10/1 plan year completed the most recent valuation and AFTAP was certified at less than 60% triggering an automatic plan freeze. What are the rules regarding when the plan can become unfrozen. Does the AFTAP need to be certified at 80% and then it can become unfrozen?

What is the correction for a plan loan when loan payments received exceeds scheduled amortized loan payments.

Example scheduled loan payment $27 per paid period. Amount received $282 per paid period. Loan is paid up now through 2012.

The loan policy does not allow for partial payments or loan refinancing.

Do you refund amount the overpayments, if so do you apply earnings? Stop payroll deduct until 2012? Reamortize loan?

Thank you!

Forgive my paranoia, but my reading of Notice 2010-6 indicates that correction would be necessary only if an arrangement with a failure is subject to 409A. Clients have severance plans exempt from 409A under the separation pay exception. Releases are required, and the severance is paid when the release is returned. Since this plan is exempt from 409A, the IRS' problems with releases providing the employee with discretion as described in Notice 2010-6 should not be of any concern, correct? Or, is anyone thinking that all 409A-exempt severance plans must be amended to include the specific payment date indicated under the Notice?

I've come across a small dentist office where the dentist and his wife make salary deferrals into something called a "Supplemental Retirement Account" with Merrill Lynch. I've never heard of this, so I Google'ed it. Everything that popped up referred to either a 403(b) or a 457 plan for a college or university. Neither of which would be appropriate for this particular client.

Does anyone know anything about these SRAs?

Thanks!

We just took over a plan and the prior tpa sent us a letter saying that the plan document is null and void after termination of services. My understanding is that this is not the case. Can someone point me to somethign in a revenue procedure or whatever that addresses this?

I thought I read this somewhere but my search did not find it. Where can I find the guidelines for the auditors report that is attached to the Schedule H? I thought I'd read that there were size limits.

Thank you

(added after I posted) I did find that the entire filing cannot exceed 100MB but thought there was an individual limit.

The Plan uses the Safe Harbor Definition of Hardship. We know that Compensation while under the "Suspension Period" can be excluded from ADP/ACP Testing. Would you also excluded this pay when determining the Safe Harbor Match of 100% on the 1st 4% deferred, or the 3% Safe Harbor Nonelective Contribution? Going further, would this same exclusion apply to determination of a "normal" Match that has a "compensation cap", or for a Profit Sharing Contribution. I believe that this exclusion is solely for Testing Compensation, but can't find any reference in the Plan document beyond reference to 414(s) for Testing Compensation. Any insights would be greatly appreciated.

The defined benefit plan terminated in 2009 and has already been liquidated in 2009. However, there is an unpaid minimum required contribution still existing in 2009. As a result, 100% excise tax penalty is imposed on the plan sponsor. The plan sponsor is going to apply for waiver of this 100% excise tax penalty. Does the plan sponsor need to pay 10% of excise tax penalty before IRS grants the waiver right now? Should Form 5330 be filed during which the plan sponsor applies for the waiver of excise tax penalty right now? When is the deadline to file Form 5330 for 2009 plan year? What should the plan sponsor do right now to deal with the excise tax penalty right now before IRS grant the waiver?

Thanks

Facts: payment should have been made in 2007. It was not and the error was just discovered. Payment will be made in 2010. Since we are after 12/31/09, we assume there is no relief under the correction notice's transition period. So then, this is a full blown error w/ reporting and income inclusion.

A few questions we cant seem to find direct guidance on:

1- Should reporting be made on a corrected 2007 W2 or 2010 W2?

2- Should the amount of the account in 2007 be paid or the amount as it stands today (which has increased)?

Thanks.

I have looked at the legislative language and the interim final regulations on the requirement to cover adult dependents up to age 26. The term "group health plan" is used but there are many definitions. In other words, is dental coverage subject to the requirement? The interim final regulations do not include a definition nor do they amend an existing regulations to expand the list of sections subject to the definition that has applied for HIPAA and certain other health benefit purposes.

EPCRS does not appear to provide for a correction method - thoughts?

Employer's payroll company did not withhold deferrals for one payroll period. What is the correction required for one missed payroll? If the ER has to make up in QNEC has anyone ever experienced the payroll company paying for this?

Is it permissible to 'double up' the next payroll (and pay the lost earnings for the late deferral when calculated)? However, the 'double up' doesn't seem likely....

Thanks,

Our client has a 401(k) with a GIC. They want to terminate the plan. How do you terminate and distribute with the GIC held in the 401(k)? Any ideas, comments, experiences, suggestions, traps for the unwary?

What year was the first year that the limit went from 100,000 to 250,000 for filing Form 5500 EZ?

If a plan holds an illiquid asset and does not have a Fidelity Bond for at least the "value" of the illiquid asset what do they have to do?

We just received another "URGENT" notice from the IRS. This one assesses a penalty for a balance due with respect to Form 945. It references a tax identification number that is neither the sponsor's ID nor the trust ID under which the 945 was filed and the 8109-B coupon deposited.

This is not the first instance, and coupled with notices regarding missing filings that were filed, mistaken filing that were filed correctly, approval notices for automatic extensions that were dated after the extended due date, etc., our productivity has been significantly affected.

Since humor often helps me deal with frustration, please complete this poll, and feel free to add your own comments as well.

Back in 1981, my one-participant corporation (ABC, Inc.) had a good year and my accountant (Sam CPA & Associates) set up a retirement plan for me. He obtained an EIN for the Plan and deposited funds in a brokerage house under the name of ABC, Inc Profit Sharing and Pension Plan with me as the named trustee. There is a photocopy of a 38 page document in my file titled "Qualified Retirement Plan and Trust" that is not otherwise identified.

A couple of years after that, the corporation was discontinued and my accountant disappeared.

I'm assuming that I probably have a 401(k) defined-contribution plan based on a possibly pre-approved Prototype Plan with "Sam CPA & Associates" as the Plan Sponsor. Further, I assume that there have been no amendments or restatements nor have annual 5500 returns been submitted although the total plan assets exceeded $100K in 1997 or 1998 when I transferred in assets from another Plan.

As I turned 71 in 2010, I want to discover and make the necessary corrections to this Plan before taking any distribution. I may want to set up a new 401(k) for my current company (XYZ, LLC; taxed as sole proprietor) and transfer assets into that first.

I am at a loss for how to approach this to minimize penalties. Any guidance would be greatly appreciated.

Thanks.