"Never argue with a fool, onlookers may not be able to tell the difference." - Attributed to Mark Twain

First off, this is generally a polite and courteous forum. Even "heated" debates manage to stay w/in the bounds of general decorum.

However, all forums are subject to the occassional person who posts for the simple sake of argument or, worse, for the simple sake of getting a rise out of another poster. A person making posts like that is sometimes referred to as a "troll".

The best way to respond to a troll is to not reply at all. Rather, if a post is sufficiently inappropriate, then use the "Report" button on the lower left side of the post.

I understand that Key/HCEs can be discriminated against, and don't have to receive any Safe Harbor match if the document so states. Based on the formula, one of the partners should receive approximately $8k in safe harbor match, but only wants to put in $5k for himself. Can he do this?

Last year we bought two small TPAs, under $250,000, that had old software and limited to no website service. Upgrading them to our software and the expanded services we offered worked out great. Both were close to us and we sorta stumbled into them. We would like to find more but haven't been able to find any merger firms that do deals that small. The firms we have come across have fees that start at $80,000K plus. Anyone know of any firms that facilitate small deals in the under $250,000 range?

Have an existing calendar year profit sharing plan where a 401(k) provision was added effective 9/1/08.

I am pretty clear that for ADP testing purposes, I have the option of using either full year comp, or comp after 9/1, for purposes of the ADP calculation.

My question is really a 410(b) one. If I have individuals who terminated before 9/1, can I still count them as benefiting under the 401(k) provision? I would think not. Even though the 401(k) is open to all nonexcludable employees, I would think I may still have a coverage issue here.

Any thoughts? I have to think this has been asked before, but as usual, my search comes up dry. I am hoping there are others out there with no life who are working this weekend.

Dog

A large fully insured group health plan providing mental health and addiction benefits renews its contract on October 1st each year. Its benefit year which tracks deductions and out of pocket maxima and the calendar plan year coincide.

Is the compliance date January 1, 2010 or October 1, 2010 or ????????????????????

P.S. Most employee benefits attorneys and consultants as well as EBSA associates have no clue that this issue even exists!!!!!!!!!!!!!!!!!

P.P.S. Please provide citations acknowledging the regulations due out by October 3, 2009 don't exist even in proposed form

I work on the 5500 for an ESOP that hasn't made a contribution in years. Every one is 100% vested. There are around 50 participants with balances but that number would be over 100 eligibles which would share in a contribution if one were made. So we've filed a Schedule H with an audit.

Now they have decided to freeze the plan. Since the extra eligibles will never receive a contribution or have a balance in the plan can we go to a small plan 5500? Technically are those who were once eligible but will now never receive a contribution still counted as "participants" for 5500 count purposes?

Thanks

I am adding 401(k) features to a client's profit sharing plan with a safe harbor nonelective 3% contribution. The plan only has 2 participants (company only has 2 employees). Both are HCE's. I understand that the plan is deemed to meet minimum coverage requirements. Is a safe harbor notice still required?

The CPA asks me" If Ms X has 2 full time employers who offer 401(k) plans, can she contribute the max to both plans since the employers are unrelated. Stupid me thought I knew the answer to be YES since practically every other kind of contribution(PS,MP, DB) would be a YES. Of course I was dead wrong. This went on in both 2007 and 2008. ANY IDEAS WOULD BE APPRECIATED!

Sincerley,

Imbarrased

Here are the facts:

Company A: Father owns 100%, son 1 (VP of comp. A), son 2, son 3 all receive W2 compensation from Company A

Company B: Son 1 owns 100% and receives W2 compensation from Company B (W2'd from both companies) -- no other family members work for Company B.

Based on this simplified scenario, could you tell me if there is a control group here? Would Son 1 be considered a 100% owner for control group determination because of attribution? OR Would the Father's will actually come into play to determine whether or not Son 1 is creating a control group (i.e. Father leaves 80% of comp. A to Son 1)?

Thanks in advance.

I have a cash balance defined benefit plan which was adopted on Dec 1, 06. We bought the company (on Dec 1, 2008) that had created the plan and don't think a determination letter application was ever filed. We'll check with the IRS to be sure but wanted to know when do we file for the new plan. I realize a determination letter isn't required but assuming we want to file for one (that's another discussion) do we use the Cycle in which our EIN number fits (I assume that rather than the old company's EIN number). Is there some rule that we have until the end of the remedial amendment cycle in which the plan was adopted (I found various articles which seem to suggest that)? ANy ideas? Silly me I called the IRS - they'll get back to me in 15 days if at all.

Thanks

One of my plans failed the ADP test in 2006. Corrective distributions were made. We later discovered that incorrect compensation was used. The test was rerun and now we see that too much money was "distributed" to HCEs earlier.

Does the method to correct ADP/ ACP failures also apply to this situation? If not, how would we correct this?

Thanks.

Are HCE elective deferrals made to a multiemployer plan included in the ADR for purposes of testing the employers non-union plan ?

Example: HCE participates in non-union 401(k) and makes elective deferrals of $2,000. Same HCE becomes covered by a multiemployer plan (a bargained plan in which the employer participates but does not sponsor) during the year and remains employed by same employer. HCE makes elective deferrals of $10,000 to the multiemployer plan. participants.

When testing employer 401(k) Plan, is the HCE's ADR determined based on the $2,000 contributed to the employer sponsored plan or $12,000 contributed to both plans?

A strictly read of the (k) regulations indicate only the contributions made to the employer (as defined in 414(b), ©, (m) or (o)) plan should be included in ADR. I have heard the IRS has said contributions to both plans should be included.

Any real life experience ?

Would suspension of benefits rules that are more generous than what the law requires be considered an "adjustable benefit" that could be reduced for a critical plan?

If not an adjustable benefit, what kind of benefit would the gap between the more generous rule and what is required under the law be called?

Cheers

Can someone give me an idea what a reasonable fee for a DB Plan audit is? $15,000??

a

Since church plans are not subject to IRC 430 i was curious to see how others are calculating the liability for the 110% test post-RPA. Also, are church plans subject to IRC 436?? Thanks.

For 2008 and earlier plan years, is there any place on the 5500 or any Schedule where the EIN of a mutual fund held as a plan asset might have to be identified? (No response relating to Schedule C reporting for 2009 and later is necessary, thank you.)

Hi all,

I am hoping someone could offer some insight to this question.

I have a plan that is looking to terminate in the next few years. Plan is currently frozen. Aftap is around 85% for plan year 2008. FSCOB stands at 100,000 for 2008. The MRC for the 2008 plan year is zero.

Say the employer decides they would not like to use any of the FSCOB in the 2008 year. They just want to let it ride. Are there any benefits to this?

I understand if the actual rate of return of the plan is positive, the FSCOB for the 2009 plan year will be increased. However, is there another angle that I am missing?

Also, say under a different scenario we tell the employer the maintain the FSCOB and to contribute excess contributions for the 2008 plan year...maybe 50,000. Of course this will not add to the FSCOB, but could be elected to be added to the PFB. Or they can just toss the 50,000 excess into the assets.

Good idea, bad idea? I am not very sure.

Help greatly appreciated.

Do the 415 limits apply to ancillary benefits from a multi-employer qualified DB pension plan, like a monthly disability?

At what point in time do you apply the 50% limit in a daily valued plan? My inclination (based on the DOL reg. and the effect of Section 72p) is that you apply 50% against the vested account balance as of the date the loan proceeds are distributed (rather than, for example, on the date the participant completes the loan application process)? Anyone agree or disagree? If you agree, is that the way loans are typically administered in a daily valuation environment? Is there any specific IRS or DOL authority on this issue which I may have overlooked?