If a foreign parent cororation with no US employees directly owns 100% of the stock 2 unrelated business with employees in the US, do the two US businesses constitute a controlled group of corporations?

Plan is using a "group annuity contract" to provide for individual self-directed accounts. Insurer is a DFE, so each "fund" has a plan number. As I understand, each fund (with value) is reported on Schedule D. When completing Schedule H must you again list each fund separately as an "Asset Held for Investment" or can you simply group PSA values together (like loans or self directed brokerage accounts) for this reporting?

Also... How does use of a "DFE Fund" reduce Schedule H reporting? What is the logic of Schedule D, anyway? It has always seemed to be a waste of paper to me.

Thanks!

Would an employer be considered a party in interest to a plan if one of its employees is a participant in a plan but the employer is not the sponsor? For example, Corporation X sponsors a profit sharing plan (Plan X) which has two members A and B. Corporation Y employs A and B. For purposes of the prohibited transaction rules, would Corporation Y be a party in interest to Plan X by virtue of being the employer of A and B (who are covered by Plan X) - or does this rule only apply to employers of employees who covered by a plan because of their status as employees of such employer.

I have checked the guidance and commentary that I have available and can't find the answer. It would seem to me that it would only apply in the case of employers who sponsor the plan, but, read literally, the alternative argument could be made. Any guidance you may have would be much appreciated.

Does anyone have a cite that details the actual timing for adoption of final required amendments at plan termination?

2007-44 says a terminated plan may be filed no later than the later of (1) one year from the termination effective date or (2) one year from the date on which the action terminating the plan is adopted.

If a profit sharing plan is going to terminate as of 7-31-08 is it sufficient to have the final termination amendment including EGTRRA and all other provisions applicable as of the termination date adopted by 12/31/08? Or by the due date for filing the employer's 08 tax return? Assume that the ER will not file a 5310.

Any input is most appreciated!

A participant in a 401(k) plan requests and obtains a hardship withdrawal to purchase his/her principal residence. Because the contract of sale included a condition that the home pass an engineering inspection, which it failed, the participant was able to cancel the contract. Now, the hardship no longer exists. Assuming that the withdrawal and the disappearance of the hardship occur in the same plan year, should the plan simply reverse the withdrawal to avoid reporting the distribution?

If a participant was eligible to participate in the plan 4/1/08 and the employer forgot to give them the SPD and enrollment form, what are the repercussions to the employer?

Thanks!

Does anyone know the bear minimum that 401(k) sponsors have to disclose to participants under ERISA in regards to investment and expense information when the participant requests it? Is there anything beyond the annual report summary required by section 103?

A 401(k) plan provides for a safe harbor employer contribution of 3 percent. It wants to make an additonal employer contribution for only certain employees (lets assume a nondiscrminatory group). Is this permissible?

A new employer ( guy who bought the previous owners business where the employees were in a SIMPLE plan ) want to continue/start up a new simple for the prople that have worked there for several years - with no eligibility for all those there on the start date.

For new employees down the road he wants to put in the 2 year eligibility requirement.

Is this allowed ( amending plan ) ?

Any other ideas if it is not allowed ?

Thanks,

Bob

The plan made matching contributions on payroll by payroll basis. At the end of the year they had matched on compensation that exceeded $225k. I see an EPCRS correction for 401a17 that allows the plan to move the excess into suspense to be used to reduce next year's match. My question is about the ACP test for 2007. Is this excess that is due to 401a17 included in the match used to determine the ACR for the HCE?

I have a client (a public school) which sponsors a 401(k) plan. Client has just told me that although it does not have a 403(b) plan, it does allow its employees to contribute to a 403(b) that they had prior to becoming employees of Client.

Is this permissible?

This week I had to help someone manually review and delete 15,000 spam emails that had accumulated over roughly 10 months.

Given:

1) it would be easier to setup a new email address for this person.

2) it would be likely that the person would do the same things that started the spam and would end up in the same situation, so #1 isn't really a perfect solution.

3) I'd like something that I can control from my PC to ensure that the spam filtering isn't turned off.

What I'd like:

I'd like something that can run remotely from my PC (presumably via POP3 access). I used one program about 4 years ago that would check the server, flag and delete known spam. Then when I'd run Outlook, I wouldn't even see the spam had been there. I'd like to be able to later review what was deleted and possibly restore any "false positives".

I've done web searches and have found a few programs already. But I was hoping someone else might be using one and have a specific recommendation or two.

PS - should add that this is for a home user account, not for a server. Although... if there's a particularly good server solution that's not too expensive, we could bounce the mail thru my brother's website, so let me know.

Let's first look at a typical situation.

Producers working exclusively for a brokerage will typically receive a draw against expected commissions. The brokerage and the producer will agree to adjust draw from time to time, either in anticipation of a big upcoming sale or decreased volume. In theory, excess draw is refundable to the brokerage after separation, but that rarely happens in practice.

I would love to say that a producer's deferral election is timely if it is made prior to the year when the draw is paid and that draw is earned in the year when paid. In other words, treat the draw as a salary payment. However, the final regulations are specific that commission-based services are considered rendered either (1) in the year of a sale if all sales are treated that way, or (2) in the year the customer pays the premium. There is no discussion of "draw."

The issue is that if draw is treated as commission, the commission sources for the draw, advanced from brokerage general funds, actually come from many sources:

1. premiums paid to an insurance company which then pays the brokerage which them pays the producer. (This can take months and span two calendar years.) Under the regulations, the producer's services are rendered, I assume, when the insurance company gets the premium, not when the employing brokerage receives payment from the insurance company.

2. premiums paid on a payment plan (i.e. quarterly). In this type of case, I assume that each customer payment is considered a separate "sale", so services for a sale of a policy will be considered 409A "services" in each year when customer payments are made. So a sale paid for with a single premium is a 409A service in one year, and a sale paid for with monthly premiums is a 409A service in each month.

3. premiums paid in a later calendar year, against which the brokerage has advanced draw. If the draw is a commission, services are performed in the year following the payment of the draw.

The more I look at this, it just seems that draw is more like salary rather than commission, simply because it has been paid and the possible repayment obligations do not convert draw into a 409A commission for puposes of timing the deferral election.

So what's the practical way to deal with this in a 409A-compliant deferral election? Can the producer just say "defer 100% of my draw in the next calendar year" and take the position that draw is more like salary than "commissions."

George

Money purchase pension plan. Employer flat-out doesn't make contributions required by Code Section 412, but years later agrees to put funds back into plan, with interest, and file for correction under VCP. Is this also a prohibited transaction, subject to Code Section 4975 excise taxes? And, I assume Code Section 4971 excise taxes apply, as well (for failure to fund pursuant to Section 412). And, of course, neither of those excise taxes is potentiallly waivable under VCP. A nightmare, ehh?

Suppose you have a small DB plan with an NRA of 62 and an Early Retirement Age of 60.

The plan also provides that a participant's early retirement benefit shall be unreduced for early commencement.

If a participant retires early at age 60 and elects a lump sum distribution, his lump sum benefit would be the present value of his accrued benefit payable at age 62 correct?

Or would it be the present value of his age 60 accrued benefit?

Situation: A single-employer QRP is sponsored/participated in by several ERs part of one ASG. (But it is not an affiliated group under IRC sec 1504.)

One of the ERs has one EE, who earns $100,000. That EE would like to accrue $46,000 in benefits, and given the overall demographics, the plan will pass x-testing doing so. However, $46,000 is greater than 25% of $100,000.

If the IRC sec 404(a)(3) deduction limit applies ASG-wide, then this ER could make the $46,000 contribution for its only EE and deduct it because other ERs in the ASG are not making less than 25% of the aggregate compensation of just their EEs.

On the other hand, if IRC sec 404(a)(3) is separately applied per ER, then this specific ER could contribute no more than $25,000 for its sole EE.

Does IRC sec 404(a)(3) apply separately to each ER in an ASG or is it applied plan-wide, allowing disproportionate use of the deduction limitation by different ERs in the ASG?

An employer sponsors a rich DB plan (2% average compensation per year of service, max 60%) and non-safe-harbor 401(k) plan with 100% matching of first 3%. DB Plan covers 300 employees of which 270 contribute to 401(k) plan. 9 of 300 are HCE. Most new hires anticipated to be employed as NHCEs but a few may ultimately work their way up. Some present NHCEs will ultimately become HCEs.

Employer is considering:

(1) Present employess stay in DB and 401(k) plan.

(2) Future hires not in DB plan but in 401(k) plan.

(3) Future hires get 3% profit sharing contribution, a feature to be added to 401(k) plan.

Apparent coverage issues:

(1) Eventually DB plan will waste away to fewer than 50 employees so 401(a)(26) test will fail.

(2) At some point -- but not for awhile -- DB plan may fail 410(b)

(3) No problem with DC until DC plan covers HCE. At that time, would be concerned about 410(b). Might (if can't pass ratio test) have to aggregate with richer DB for average benefit testing. It would seem if 3% benefit is in 401(k) plan, might have to give gateway to others (i.e., to current employees) but if 3% in separate ps plan, no gateway issues, since all employees under the plan get the same %.

WOULD APPRECIATE COMMENTS ON THE ABOVE AND IF I'VE MISREAD THE SITUATION AND THERE ARE OTHER ISSUES THAT NEED TO BE CONSIDERED.

Does anyone have a good list f state taxation of NQ plans?

I have a DC SERP account balance excess match plan

I know PA doesn't tax as money is being deposited but when distributed

But I'm not real familair with other states.

thanks

Lexy

For fellow pension and pension trivia geeks (and anyone else interested):

Does anyone have - and would be willing to share - an historical list of the various and sundry pension-related pieces of legislation enacted since ERISA? Alternatively, does anyone have knowledge of a resource that might have such information and/or a link to same?

It would also be helpful if such list would include a summary or bullet points of the pension aspects addressed, added or changed by each such piece of legislation.

Thanks!

An employer deposited $15,000 more in ER PS contribution into a plan in 2007 than they should have. It was never allocated but is currently in a pooled account. Can they remove this, paid back to the ER, as a mistake of fact contribution and....thats it? Any penalities, fees, disclosures, etc.?

Thanks