We are in the process of finalizing w2 for the nonqual plan. I have a conflict with box 1. One item I pulled says to include Income in Box 1 and Box 12 using code Z. Another item only mentions Box 12 using code Z.

Anyone know which is correct.

thank You

Our employer allows employees to make their owed amount of insurance premiums to be taken out before tax. They also offer a FSA.

Does our employer need a separate premium conversion plan document for our pre-tax health plans that fall under section 125? Also, do these premium conversion plan documents expire every year, as in, the 12 months defined by section 125.

I guess my basic questions are: As the employer, is this something we have to keep on hand? Is this something we have to do every year? If so, what does an actual document look like and how do we go about filling out one? I've been trying to research this topic but am having trouble finding meaningful answers.

I need help in finding our what shock claims are when you are talking medical cost? Can anyone help?

Say we have a married couple named Jack and Diane

Jack earned W-2 compensaiton in 2009 of $22,000 and is age 60.

Diane had no W-2 compensation and is age 45.

Jack participated in a 401k plan in 2009.

They file a joint tax return and have AGI below all applicable limits.

Jack made a 401k Roth contribution of 22k (16,500 + 5,500) in 2009.

Do we agree that Form W-2, box 1 for Jack would show $22,000 since all contributions are Roth and taxable?

Is it true then that he would be able to make a $6,000 Roth IRA contribution for 2009?

And is it true that he could make a $5,000 spousal Roth IRA contribution for 2009?

This means with W-2 compensation of $22,000 Jack would make retirement plan contributions of $33,000 in total.

Is the above accurate?

Thanks.

I noticed the following language in today's newsletter from benefitslink (McKay Hockman article):

Note that a recharacterization may only be made when a traditional IRA is converted to a Roth IRA. A recharacterization may not be made when the conversion is from a 401(k) (or any other qualified plan) to a Roth IRA.

http://www.mhco.com/Library/Articles/2010/...har_010810.html

Any additional info explaining why (reg citation?) recharacterization back to a qualified plan is not permitted would be great. Thanks!

Basic question. Plan has last day rule. Employee terminates 12/31. Are they eligible for part of the contribution? Relius excludes them from the contribution since they have a termination date.

Why is it that the last two Presidents want to get rid of 401ks as opposed to making them better?

First it was Bush with his LSA, RSA, and ERSA Plan.

Now its Obama and Retirement Annuities.

Obama to meddle with your retirement account?

Hi all,

What's the current thinking on allocating assets among participants in an underfunded, non-PBGC-covered DB plan?

May we simply allocate the available assets among all participants in proportion to their PVABs?

Or must we pay certain classes of participants in full? If so, which participants must be paid in full? e.g. NHCEs?

Non-owners? Non-50% owners? etc.

TIA.

.. Scott

Line 3b of Form 5300 asks if the plan has rec'd a Determination Letter. If yes, it asks for the "Number of Amendments".

I am uncertain if this means the number of amendments since the last determination letter, or the number of amendments since the last time the plan was restated.

In my situation, the last Determination Letter was dated in 2005. My plan was restated for EGTRRA in 2009. Amendments made from 2005-2008 were obviously incorporated into the restatement.

So, do I indicate on 3b the number of amendments since 2005 (last DL) or since 2009 (restatement)?

The preamble to 409A permits a plan to distribute the lump sum value of a non-qualified plan benefit if the PV is less than the 402(g) limit, even if the benefit has already commenced as an annuity. When we restated our plan to comply with the final 409A rules we incorporated this option. However, we never created the methodology to use calculate PV, post benefit commencement.

Our qualified plan contains a lump sum option and explains the calculation methodology. I'm thinking the simplest option would be to follow the same methodology, without regard to the aggregate value of prior monthly distributions.

This situation arose because employees did not make 409A elections and defaulted to the J&S annuity option, and because the interest rate we use, the 30-Year T-bill rate, jumped from 2.87% in December 2008 to 4.49% in December 2009.

I invite comments from the community.

LL&P.

Corporations A B and C each maintained a 401(k) plan. Each companiy was acquired by company D and each plan was merged into company D's 401(k) plan, which is now being filed for a determination letter. It has now been discovered that the plans for company A B and C may not have been in full compliance with GUST or subsequent amendments. If the IRS discovers the mergers upon the review of company D's plan, this could be a problem???

I'd like to file a VCP to clean this up, but the question is under what plan do I file the VCP? Since plan's A B and C do not exist any more, and plan D is tainted, I will file under plan D's name and disclose the mergers of A B and C. What I don't want to do is to file three or four separate VCPs. please confirm that one filing will take care of this. tnks.

We have an employer that conducted a dependent audit. Some employees did not respond and therefore dependents got kicked off. Now there are employees coming forward with the appropriate documentation verifying dependent status. If the employer wants to permit the re-enrollment of the dependents, is there anything that would prevent the employer from charging the employee an administrative fee of some sort? Kind of like a penalty for not reading their mail, taking it seriously, responding, etc...

Anyone else frustrated with the fact that the 1096 and 945 forms on Relius Gov. forms have still not been released?

We send everything out to our clients and while I can put off the 1096 and 1099-R Copy A filing forms alittle bit, the 945 is due to be filed by Jan. 31st.

Not to mention the fact that I don't want to have to send our clients 2 different mailings on this stuff; one is complicated enough for some.

We're thinking of looking for a new 1099-R forms vendor.

Others?

According to our Plan Document, our Plan can use forfeitures to reduce the employer match. Our TPA incorrectly used it to reduce employee contributions. This happened in 2006. How does our Company correct this error? Do we just give an amount equal to the forfeitures used in 2006 to our current forfeiture account?

Any help would be appreciated.

We took over a plan a few months ago that had outstanding loans. We posted the loans to our system and participants have since been making loan repayments to their new accounts.

Now the participants with loans have received invoices from the previous provider for loan payments (loans were repaid quarterly). I contacted the previous provider who stated that "Loans for clients do not transfer to new carriers." I've only been doing this a few years, but I have never heard of that and can't find any information on it.

It's my assumption that loans are part of the plan, and if the plan transfers then the loans come with it. How could we accurately keep records (top-heavy test, vested account balances, keeping participants under max loans outstanding, etc.) without this information?

Maybe this is totally normal and I've just never dealt with it...I sure hope that's not the case.

We have a 403b plan that intended to use the 3% SHNEC for 2010 and gave the safe harbor notice timely. However they did not sign the restated 2010 plan document which implemented the safe harbor formula, so the plan will not have to run ACP testing. However the client now does not want to implement the 3% safe harbor and claims they do not have to since they have not signed the plan yet. I am thinking that the participants could have a cause of action against employer for promising a 3% nonelective, however their deferral elections were not impacted by the safe harbor notice. How do we correct?

We have a plan with plan year of 10/01/08 to 09/30/09, the owner received $49,000 in total contributions. Now the plan has been restated to a calendar year with a short plan of 10/01/09 to 12/31/09. Client wants to make a Profit Sharing contribution for the short plan year. We used the 415 limitation for 2009 of $49,000 for the plan year ended 09/30/09.

can we allocate a pro rated 415 limit of $12,250 for the short plan year?

I'm embarrassed to admit I'm a newbie to demos. How do I do it? Do I just have an attachment labled "Demo 3, 6, and 9", attach schedule Q, and the Non-discrimination report from the TPA?

A participant with Roth 401(k) deferrals terminated employment. She was 40 years old and her first deferral was in 2006. She rolled the Roth 401(k) money into a new Roth IRA in 2009.

1) Is this considered a nonqualified distribution, since she was under 59.5?

-or-

2) Since she rolled the money over to the Roth IRA, it is still qualified. The 5 year clock would be January 1, 2009, for the new Roth IRA. The code on the 1099R is H. Box one on the 1099R would be the rollover amount. Box 2a on the 1099R would be zero. Box 5 on the 1099R would be zero.

I have been told that minor deviations from a master volume submitter do not prevent an adopting employer from relying on the volume submitter advisory letter. (I disagree) This was told to me by someone who ususally knows what she is talking about so I am curious as to other's views.

Also, if there are minor deviations from a master volume submitter, does one use a 5307 or a 5300 in requesting an individual determination letter? I suspect 5307 but would like to know if anyoneknows for sure.

Thanks for any assistance.