Need to know! Is there a time frame that an employer has legally to adhere to when reimbursing your FSA monies? I was told I would have a check in two weeks. I submitted all receipts last week of December and as of the date of this post still have not received the $600 from my account. I have also willfully left my employment with the company the middle of February, but have maintained contact. I keep getting "oh the check is in the mail for the amount of $600, or the check was misplaced, and so on and so on. Are there penalties or fines the employer or managing agent of the FSA account can face by not expediting this return of my money in a certain amount of time? I'm very frustrated. Too, I now live out of the US and feel that I am just getting the run around. Thanks for your time. Not sure what my next step should be here but this just doesn't seem right.

is it sufficient to list the participants actual vested percentage or must the plan's vesting schedule be listed on the statement as well?

A participant's child has been diagnosed with Celiac disease; are books on coping/living with the disease, and cookbooks reimbursable through the FSA?

Please confirm that only the Employer EIN is now required on the 5500 filings now that Schedule P is no longer required. Few of our plans have a Trust EIN but I want to make sure it no longer is needed for the filings. Thanks in advance

Employer who sponsors a fully insured health care plan is switching health care providers. Currently, the employer provides retiree medical benefits based on a very informal policy. I believe there are currently 4 people who are receiving such benefits. Most of whom were executives of the company. The new provider is requiring the employer define who is (or who will be) eligible to receive retiree medical benefits.

The twist is that employer wants to provide retiree medical benefits to "only those people selected by the Board of Directors." In other words, the employer does not want to say only select management or certain officers but wants to be able to provide retiree benefits to a person if they have been with the company for 20 years (as an example). However, employer does not want to provide retiree medical benefits for all of its employees, it does not want to lock itself into providing benefits to all, and it does not want to lock itself out of providing benefits to certain rank-and-file.

Employer wants to know if is it possible, under law, to provide retiree medical benefits as it wishes? If so, what is some language they could use to define the "group" who is eligible for retiree medical benefits.

Thank you!

First time here and can't seem to find an answer to my question in the archives, so hoping for a little help. My husband is starting a new job tomorrow. We are right now trying to fill out the paperwork on the 401 plans the company is offering. Based on years of service, they are offering to match up to 8% on either a 401k or 401a. From what I am reading, the 401k is pre-tax and the 401a is after-tax. We have never had this opportunity and clueless as to which is best and looking for some direction. Thanks to anyone who might be able to offer us some help.

Hello, I found this message board very helpful and intersting. My question is as follows:

We are testing 2006 and in 2005, we had a restructuring that eliminated many of our HCE's. Due to this, there is a large count for people employed in 2005 to compute our Top Paid 20%, since they all left after more than 6 months of service.

When I prepared the look-back list of everyone that received compensation in 2003 and listed it in decending order and apply the 20% limit, 14 of the top 25 (my 20% number) had no service in 2006, but they and the remaining 11 are HCE's by definition.

The question is does this mean that I only use those 11 HCE's for the testing in 2006 (we are on the current year testing method)? Any employee below the 11 that remained in 2006 that earned >90K, was not in the top 20% for 2005.

Note: We have no 5% owners in either year.

If a plan is a safe harbor plan with all accounts 100% vested, would a generic quarterly statement stating that all accounts for all participants are 100% vested fulfill the new vested account balance requirement?

Hello!

I withdrew all monies in my Roth IRA account in 2006 as a first time home owner. I'm confused about the various components of the distribution and would very much appreciate some guidance on the tax ramifications.

The IRA was opened in 2001. A total of $15,000 was contributed from 2001-2005. Additionally, I rolled monies from a former 401K plan in January 2006 into my Roth IRA in the amount of about $6,800 via a rollover IRA. My Roth IRA was valued at about $28,900 when I closed the account in May 2006.

I understand that I can take out the $15,000 tax- and penalty-free. What about the amount rolled over from the 401K and all earnings on the account, which equal about $7100?

Thanks in advance for your feedback.

A question has arisen as to a taxpayer who initiated a Roth Conversion in November, 2005, when the taxpayers AGI was $90,000. The taxpayer paid the tax on the conversion with their 2005 return. However, the new custodian of the IRA failed to complete the conversion until January, 2006, and has issued a 2006 Form 1099-R stating that the conversion occured in 2006. The taxpayers AGI in 2006 is over $100,000, so a conversion could not occur in 2006.

The question is whether the taxpayer can leave things as they are; that is, the conversion occured in 2005, or do they have to file an amended return removing the conversion in 2005, and then having to go through a recharicterization of the Roth in 2007, due to the inability to convert to a Roth in 2006.

Any replies would be helpful! Thanks much.

I know in a KSOP you can't fund the Safe Harbor with employer stock, but if you've got a properly functioning leveraged ESOP, can you have the 3% contribution go into that Plan?

Thanks

Christopher

Had an interesting experience this morning

Had someone tell me that their lawyer told them (yes, 2nd or 3rd hand information)

1. Even if the Employer has been sponsoring a 401(k) Plan for many years that it is okay for the Employer to establish a new qualifed ESOP with years of service starting from plan effective date; and

2. That when an Employer is sponsoring both an ESOP and a 401(k) Plan, that the 415 limit applies to each individual plan. In other words, it could be $45,000 in the ESOP and $45,000 in the 401(k).

Before I'd had this meeting I would have thought the answer to both was obvious --- no. But now I'm not sure about anything anymore.

Thanks

Christopher

Can a participant make a hardship withdrawal from ER dollars held within a MPPP as long as it is for an immediate and heavy financial need on the participant? Or, are hardships not allowed with MPPP plans?

I know we are all waiting for the DOL's words of wisdom on the Qualified Default Investment Alternative, but does anyone have an idea when we may see guidance on the Investment Advice provisions under PPA? Is anybody operating with a level-fee arrangement qualified under PPA? Thanks.

Am I losing my mind or did I read somewhere that the asset limit for the 5500EZ owner only plan filing requirement is increasing from $100,000 to $250,000? I have looked through this website and my ASPPA Journals and the IRS website and haven't found any references, but I could have sworn that I read it somewhere and I have a broker asking on behalf of a client ......

Thanks in advance!!

My employer deducted a 401k deduction from my paycheck in error. At the time of the deduction, I was not eligible to participate in the plan. The company's 401k administrator took the deferral and placed it into a plan suspense account and never notified my employer of the issue. This problem was discovered during the audit of the 401k plan in March 2007. My employer is going to refund the deduction to me since it was never placed into my account. The question is--should my 2006 W-2 be corrected since the 401k deferral was never placed into my 401k account? Or, should all of the corrections occur in 2007? Currently, my 2006 W-2 (Box 12) reflects that I deferred $15,000 to a 401k, but only $14,000 actually made it into my account. The ineligible contribution of $1000 was placed into the plan trust's suspense account and will be refunded to me this month

Thanks.

Sole prop (with employees) wants to terminate a safe harbor (3% nonelective) plan.

The part that's bugging me is, how do you handle this for determining the compensation on which to base the 3% for the sole prop himself? Let's say the plan term date is 6-30-07. Since a sole prop doesn't technically "earn" income until 12-31-2007, how does this work? Do you:

1. Give the sole prop a zero contribution?

2. Give the sole prop a contribution based upon 50% of the 2007 income?

3. Give the sole prop a contribution based upon 100% of income?

4. Other

I think I could argue for either 1 or 2, but I incline toward 1 as more technically accurate, IMHO. Any thoughts?

someone told me that for the schedule b, i only need update every 3 years... is this correct? how could it be?

example... for 2006 Schedule B, valuation date 1/1/2004... for 2005 Schedule B, valuation date 1/1/2004 and 2004 schedule b 1/1/2004

Employer would like to allow participants to "purchase" service credit to qualify them for early retirement subsidy that they would not otherwise qualify for. Employees are all NHCEs. Is there anything prohibiting this?

I'm not advocating it. I just would like a direct answer to the question: is there anything that would prohibit this?

Thanks for any comments.

Is there any method to correct SEP contributions. For the last several years, a client only used base wages for contributions that were declared. They have been operating under the Model 5305 and did not know they could not exclude bonuses and overtime. Can they self-correct?