Have gotten correspondence from PBGC saying that it does not cover preretirement death benefits including qualified preretirement survivor annuity. Can anyone provide me with a cite for this position as it applies to a multiemployer plan? Thanks.

Suppose a DB plan currently has defined the plan's interest rate and mortality as the GATT applicable rate and mortality. The plan goes on to define the Section 417 interest rates which shall be used as a minimum: the applicable mortality is the commissioner's standard table from Code Section 807(d)(5)(A) and the applicable interest rate from the 30-year Treasury securities as specified by the Commissioner for the lookback month(s) prior to the stability period.

In the 2008 plan year, if the plan is not yet amended for the 417 change from PPA, must the plan compare the lump sum determined by using the old GATT mortality and full 30-year treasury interest rates (the existing terms of the plan), to the lump sum determined from the new required 417(e) blended rates and its new mortality?

Or can we just switch immediately in the 2008 plan year to just use the new blended rates and mortality with any 411(d)(6) worry, even if no amendment is in place describing these new rates and mortality?

Suppose a new DB plan has a formula where the accrual will provide 1/10 of 415 dollar limit for one of the employees (the maximum accrual in year #1). Suppose the plan starts 1-1-2008.

When determining the maximum allowed for funding purposes, is that employee's maximum cushion actually limited to the 415 limit at the end of that first year, thus not truly allowed fund (for that ee) the 50% cushion?

2008 limits for Roth Contributions, IRA Deductibility , Saver's Credit...

http://www.irs.gov/pub/irs-drop/rp-07-66.pdf

My sister's employer has established an HSA to fund the deductibles in the high deductible health plan. I understand the fully insured plan needs an SPD, do either of the plans require a written plan document? Does the HSA require a written trust? One more thing, is the trust subject to 404 ( c ) if it is a trust? thanks so much.

I know the holding period for moving simple IRA assets into a 401k is 2 years starting the calendar year contributions start. Can someone clarify if this period is on the plan level or the participant level? In other words, if the plan started contributions in 2005 yet there were new participants that joined in 2007, can everyone's assets transfer into to the 401k or does everyone's period start in the year in which they started to contribute?

Thank you for your help

Does one offer "a HSA" or "an HSA"? A Google search indicates that more sites use "an HSA" but there are 14,200 hits that used BOTH phrases on the same web page (including on the Department of Treasury website).

A tax-exempt entity sponsored what it thought was a qualified money purchase plan. They find out in 2004 that the plan was never qualified.

What does the trust have to do now (the trust never filed 5500s, so the statute of limitations never ran on any of the plan years)? Re-calculate its taxable income and file a form 1041?

thanks for any help.

In the 7 years I've been doing benefits, I've never filed for a determination letter to satisfy the "administrative scrutiny" requirement under the QSLOB rules. How difficult is it to receive one of these letters? Am I looking at a long, tedious process, or is the level of interaction with the IRS similar to your typical determination letter application? Should I avoid submitting at all costs? Any insight would be appreciated. Thanks.

QDRO is for a 401(k) plan awarding the entire participant's account to the AP. The order gives AP the option to receive payment in cash or rollover consistent with plan terms. Nothing in the order forces immediate payment. QDRO has been reviewed and ready for payout.

AP has asked us to keep the money in the plan. Since AP is not a participant, the AP needs to make an election, correct?

I understand that welfare benefit plans under cafeteria plan arrangements are subject to certain nondiscrimination rules: eligibility, concentration and benefits tests,etc.

Do the same rules apply to a welfare benefit plan NOT under a cafeteria plan?

Questions are: In welfare benefit plans........

May health insurance be offered only to certain individuals?

Can the employer pay different amounts to different employees within the company(ies)?

Does the employer have to offer insurance to all employees if they are a part of a control group and/or affiliated service group?

I can't find rules on just welfare benefit plans as opposed to welfare benefit plans under cafeteria plan arrangements.

I would appreciate any guidance on this issue. Thanks!!

An executive (is a key employee) voluntarily terminates employment. The company enters into a consulting agreement whereby the executive gets a substantial monthly payment to provide consulting services if the company requests (which is capped each month at less than a weeks worth of time). I have already dealt with the concern whether the obligation to simply be available to consult but still get paid without consulting is a substantial risk of forfeiture. Let's assume the facts show that it is not, so the consulting compensation is deferred compensation. If the agreement is entered into after the executive terminates what are your thoughts on the specified employee delay? The delay applies to payments "on account of" separation. The executive was clearly a specified employee on the date of separation. The guidance is otherwise unclear. Seems as though the delay would apply. Thoughts?

Well now I've really lost what was left of my mind.

Company A is a publically-traded company and implements a NQDC plan for Sarah (a key employee as defined by Code Sec. 416). Company A goes private and continues to sponsor the NQDC plan for Sarah. At some point thereafter, a distributable event occurs and Sarah wants her dough. Is Sarah a "specified employee" for purposes of the 6 month delay in distribution rule?

The final regulations clarify that “[t]he term specified employee means a service provider who, as of the date of the service provider’s separation from service, is a key employee of a service recipient any stock of which is publicly traded on an established securities market or otherwise” (emphasis added).

I recognize the final regulations contain special rules (including rules applicable on account of various corporate transactions) for determining whether someone is a key employee on their separation from service date (i.e., rules that may treat an individual as a key employee during a “window period” which may incorporate their separation from service date). Regardless of the application of the key employee rules, if a formerly public company is privately-held on the service recipient’s separation from service date, do you think they can still qualify as a “specified employee” under the final regs?

Can anyone help me sort this out? Thanks!

Sam (owner) has an IRA and a 401(k). Sam's DOB is 5/21/1937. He will be 70 1/2 on Nov. 21, 2007.

During early 2007 (say January) he rolled his IRA over to the 401(k) plan. This rollover occurred prior to his turning 70 1/2. No RMD was done from the IRA.

To calculate his RMD for 2007 his 12/31/2006 balance would be used. Do I need to use his IRA balance as of 12/31/2006 to calculate even though it wasn't part of the 401(k) at that time?

Thanks

A doctor in a 3 participant pension plan has a USAA life policy with a face amount of $300K and a cash value of over $200K, they have to pay quite a bit in PS 58 costs each year on the policy. The doctors wife was inquiring as to how this may be avoided and if the policy could be assigned in the doctors name rather than the plan. I explained this would possibly be a taxable event. He is 65 and still in practice. If he gives up the insurance he loses the face amount. Is he stuck with these costs? A 1035 exchange???? I always felt life policies had no business being held in a qualified retirement plan

Co. A is 100% owned by Able

Co. B is 100% owned by Baker

Co. C is 50% owned by Able and 50% owned by Baker.

Is it true that A&C are in the same controlled group and B&C are in the same controlled group, but that A and B are not in the same controlled group?

If Co.s A and B should merge into C, retroactive to mid-year 2007, what effect would this have on testing?

I've been asked by a client if I could tell them an "average" matching contribution formula or perhaps what the most common match formula might be that we see in Qualified Plans.

I've been in pensions for 17 years and in the old days it was very common (in our area anyway) to see a 50% match up to 6% deferred.

But...that WAS in the old days. There are so many different possiblities now, along with the safe harbor match plans, that I can't even begin to imagine a general average match formula.

Also, many of our small clients have suspended or eliminate their match formulas for economic reasons.

This particular client uses a 50% up to 4% match and was told by an employee on their benefits panel that the match was low.

Any thoughts?

In a profit sharing plan, a participant hired in February and eligible in June. When calculating their portion of profit sharing contribution, would you base it on all wages for the year or only those since their eligibility date?

Suppose two companies, each who maintain their own retirement plans, are determined to be an affiliated service group under the management organization definition. Yet they have operated independent plans with different eligibility requirements and employer funding. Definite VCP candidate?

If a participant of a 401k plan made deferrals and received match contributions then terminated and is fully paid out from a plan by the end of the plan year should they be included in the ACP test?