Bob, Inc provides actuarial services for only two companies (TPA, LLC, and LOAN, LLC). Robert owns 100% of Bob, Inc, which in turn owns 5% of TPA, LLC (a Third party administrator) and 20% of LOAN, LLC (a loan processing company)

The remaining ownership of TPA, LLC and LOAN, LLC is owned by unrelated investors.

Which company(ies) satisfies the defintion of a First Service Organization? Which company(ies) satisfies the definition of an A-org?

I have two companies, both owned by the same four owners in the same percentages. It is definitley a controlled group. They were set up with two separate plans which are identical and only have a 401(k) feature.

Don't I automatically pass coverage since there is only 401(k) and everyone who is eligible is considered 'benefiting' and so I can perform ADP/ACP Testing separately for each plan?

I have two groups of employees who work for XYZ Corp and for whom I am trying to decide if either group should be included in my non-excludable count for 410(b) coverage for Corporation XYZ:

Group 1: 4 Employees who are paid by ABC Leasing Company and worked for XYZ Corporation 20 hours a week for at least one year. Daily duties are determined and directed by XYZ Corporation.

Group 2: 16 employeeswho are paid by ABC Leasing Company and worked for XYZ Corporation 30-40 hours a week for more than a year. Daily duties are determined and directed by XYZ Corporation.

Group 2 full under the definition of 'leased employees' And so I believe Group 2 is included in my count, but I am not sure about Group 1. Can anyone provide guidance.

I have 4 companies (A, B, C, D) all owned by the same 4 people (Owner 1, 2, 3, 4) in differing percentages.

Owner 2 is the daughter (age 30) of Owner 1. Owner 1 owns more than 50% of each company (looking at each company separately). Is my reasoning correct, that the Owner 1 'owns' Owner 2's shares since he owns more than 50% of the shares of the company?

If my reasoning is ok so far. Now, I am down to three owners to do determine if a controlled group exists. Owner 3 does not own any of Company C, so he is dropped from the testing when I am testing for a CG with all 4 companies together. There is still a greater than 80% controlling interest when I remove Onwer 3.

If I pass the 80% 'controlling interest' test, and then pass the 50% 'effective interest' test, then I have a Controlled Group consisting of all 4 companies.

Then am I right that only 1 coverage test needs to be performed OR do I need to look at other sub Controlled Groups that might exist and perform other coverage tests?

We're considering taking over a plan that has had a ROBS transaction in the recent past and were reviewing the memo released by the IRS on 10/1/08 regarding their guidelines on this matter. It details the many possible design flaws that ROBS plans have, as well as the IRS' intention of intensifying their investigations of these types of plans. It seems that the IRS is now backtracking on an idea that they originally approved of, (kind of like the 412i plans)? The employer's attorney, who sold them the plan, is also backtracking.

The plan's approved prototype document allows the plan to invest up to 100% of its assets in qualifying employer securities; the plan appears to have been operated as the document dictates in every respect. The IRS memo makes it hard to believe that even if everything was done right, the employer may still not escape unscathed from an investigation. What would be the best way to insulate the employer in this situation - a private letter ruling, EPCRS - or is there nothing that can be done after the ROBS transaction has occurred? All help is greatly appreciated.

Plan Sponsor adopts resolution during 2009, to terminate 401k plan. Employees will be able to salary defer on all pay periods through the end of 2009, w/ no 2010 pay periods eligible to be deferred from. Early 2010 plan sponsor plans to wind down affairs and process the distributions.

Does an employee who met the eligibility req'ts prior to 12/31/09, but who has never had an account balance, count as of 1/1/2010 for the 2010 5500.

Noone can "participate" in 2010. I realize those w/ balances certainly do count for the 5500.

If yes, the plan count will be high enough to require an independent audit (the plan sponsor would like to avoid the expense if possible). I'm not locating anything definitive that answers this question. If anyone has any thoughts I would be very appreciative, thank you.

I assume that an individual who makes the maximum Roth deferral into a 401(k) Plan (whether or not the individual is over or under age 50) can also put the maximum into a Roth IRA (if the individual meets the compensation limits for a Roth IRA.

In other words, someone over 50 could put $22,000 into a Roth through a 401(k) plan & then, if eligible under the Roth IRA compensation limits, could put another $6,000 into a Roth IRA.

Correct? Or am I smoking something?

It is my understanding that for a calendar year plan all PPA amendments must be made by the last day of the 2009 plan year. Am I right that there has not been any extensions that would allow the Plan to wait until its cycle filing date to adopt such amendments?

Let us rise up and be thankful, for if we didn't learn a lot today, at least we learned a little, and if we didn't learn a little, at least we didn't get sick, and if we got sick, at least we didn't die; so, let us all be thankful. - Attributed to Buddha

The Pilgrims made seven times more graves than huts. No Americans have been more impoverished than these who, nevertheless, set aside a day of thanksgiving. - H. U. Westermayer:

(Please feel free to add your own.)

We have a small calendar year DB plan. Do we have to pay our 2009 PBGC premium in 2009? MAY we pay our premium in 2009? What is latest possible date to pay?

Company A has a DB plan and a 401(k) plan. Company B has a 401(k) plan. Company B is looking to acquire Company A.

If the acquistion takes place, can the Company immediately merge just the 401(k) plans AND still use the transitional period for the DB plan?

How much of a pain in the butt is this? Any guidance issued out there?

Just checking to make sure I am thinking correctly.

Partial plan termination occurred and employees laid off because of employer initiated action were 100% vested. If some of the employee who were previously laid off are later rehired, new employer contributions would be subject to the vesting schedule counting past service correct?

Pretty simple question on the 1099-R for a QDRO payout to the Alt. Payee (who was the spouse). [she took the cash which I know is IRS Code "2" because the 10% doesn't apply, just ordinary income tax.]

My question relates to the 1099-R form item box "total distribution". Do I mark this box because this is the total distribution for the Alternate Payee of her portion of the Participant's balance or is the box left blank?

thanks in advance & hope everyone has a good Turkey Day!!

For employers wishing to maintain a SEP IRA plan, the Serive has provided a Form 5305-SEP as a kind of "prototype" plan document. In order to be eligible to use the Form 5305-SEP, however, an employer must not currently maintain another "qualified retirement plan." Does anyone have thoughts as to whether, for these purposes, the Service would consider a 403(b) plan to be a "qualified retirement plan"? I have posted this question on another forum (targeted to SEP questions), but received to replies, so I thought I would try posting here, too.

Thanks

There was a post close to this but not right on point. If an employer has a SIMPLE-IRA and makes matching contributions to it, but fails to do so for a given year, what are the ramifications? Obviously they would not be able to deduct the contribution until it was made, but if the contribution deposits goes beyond the close of the following year (calendar year, makes deposit on 2/15/09 for 2007 year), what are the ramifications? In this situation, they still have not made the 2007 contribution, and may not be able or willing to. My thought was that in addition to losing the deduction, the SIMPLE IRA would be invalidated and the employee contributions would then be considered deductible IRA contributions subject to those lower limits.

Am I on track?

Tim

The following was from the 2009 EA meeting. The gist was that a contribution could not be deducted for a (tax) year earlier than the (Plan) year for which contribution was claimed on schedule SB. Does anyone have an update or confirmation on this?

•Can employer claim prior year tax deduction for grace-period contributions reported on current year’s Schedule SB (tax year = plan year)?

-Some authority for claiming deduction

•Regs. §1.404o(a)-14(d)(2)(ii) and §11.412©-12

•Rev. Rul. 77-82

•PLRs/TAMs 7945115, 8210014 (TAM 200604040 revoked for contributions for hours worked in current tax year), 8714008

-Current IRS ruling position apparently ties deduction to reporting on prior year Schedule B/SB

•Rev. Rul. 76-28 (plan must treat contribution as if actually received on last day of employer’s tax year)

•PLRs/TAMs 199935062, 200311036, 200523033, 200526022–How to apply when tax year ≠plan year?la

Is anybody aware of cases that discuss whether a failure to maintain tax qualified status is also a fiduciary breach under ERISA

Scenario

Individual owns minor% share of Partnerships A, B & C. There are no employees at these partnerships.

Partnership A is owned 99% by Limited Partnership D

Partnership B is owned 99% by Limited Partnership E.

Partnership C is owned 99% by Limited Partnership G.

If Partnership F owns 99% of D & E, are Partnerships A&B considered a single employer via common control rules? Does it matter if they are limited partnerships or general partnerships?

For purposes of the individual establishing a defined benefit pension plan, would the individual be able to have multiple plans at A,B & C as separate employers? or is it limited to A/B(considered single employer due to common control) and C?

Please provide guidance - thanks!

I know there have been other discussions on this, but I want to make sure we are not missing anything. We have sent each RMD participant a notice regarding their RMD for 2009 and asked them to decide if they did or did not want to take their 2009 RMD.

If a plan has employees who did not take their RMD, are we required to attach the "default to discontinue 2009 RMD" amendment by 11/30 or is that just required if the employees wanted to roll over their RMDs?