Although I've worked with qualified plans for many years, I know little or nothing about SIMPLEs. Recently I was asked if Roth provisions can be added to SIMPLE IRAs. Is it possible under current rules? And if not, is it something that is being considered for addition in the near future?

Can a US citizen that will be back in the US some day, with no US Earned Income in 2006 or 2007 Put money in a Roth IRA for 2006 or 2007?

Participant is over 71 years old and still actively employed in the company.

Participant wants a full distribution from her 401(k) account (distribution would be in excess of RMD).

Participant does not claim hardship - participant (knock wood) merely wants to enjoy her life.

Plan does not permit loans and is very restrictive on when distributions are available (retirement, termination, death, disability).

We understand that participant may begin withdrawing from 401(k), but can she withdraw more than her RMD (EVERYTHING at once)?

I have been scouring secondary materials looking for a list (exhaustive or not) of permissible uses by an S-corp ESOP of corporate distributions.

I have found some (e.g., funding repurchase obligation, repurchasing stock distributed to an IRA, buying additional stock, paying down ESOP loan and plan expenses) but i can't find the statutory authority for these things. is there a code section or IRS materials explicitly permitting these uses of corporate distributions?

Owner is wrapping up a businiss and is the only one left, so there is no payroll department. He took out a $50,000 loan in April and only made 2 payments last year.

The payments from 3rd quarter were not put in by the end of the 4th quarter so it should be "deemed"

Questions:

Is there any option to correct in EPCRS or any other voluntary correction program?

Is it taxable in 2006 or 2007?

We have a DB/DC combo where the documents were designed to provide the top-heavy minimum, in cases where someone participates in both, in the form of a 5% DC allocation.

Two people who are vested participants in both plans terminated during the plan year. Both worked 1000 hours. The DB document says that the TH min need not be provided in both, and may provide it in the form of a 5% allocation in the DC plan. The DC document also says that the TH min need not be provided in both, and may provide it by increasing the 3% minimum DC allocation to 5%. However, the DC document contains a last-day requirement, which is referred to where it mentions the basic 3% minimum.

Because of other provisions in the DC plan, all participants, whether active or not, are receiving a 7.5% DC allocation. So in the case of the two terminated participants referred to, they will certainly receive a DC allocation that is good enough to satisfy the TH requirement. But my concern is, since the DC document says that those who are not employed on the last day of the plan year do not get a TH allocation, are we allowed to consider the allocation they did receive as applying to the TH min? Or do we have to give them a 2% minimum DB accrual?

An active employee is about to vest in, and receive an immediate distribution from, his employer's 457(f) plan. He wants to know if he can elect to have the distribution contributed to his 403(b) or 457(b) plan account, like any other compensation. No different than electing to contribute from a bonus that would otherwise show up in Box 1 of the W-2? Or a 409A nightmare? What do you think?

I have a plan document that uses "Code Section 415 Safe-Harbor Compensation" definition which reads like (but does not reference) the general definition under 1.415-2(d). The company does not calculate deferrals on imputed income amounts for group term life and personal car usage. The plan document does say that Compensation shall include amounts received: “… for personal services actually rendered in the course of Employment…” and at the end it says “… Compensation shall include only that Compensation which is actually paid or made available in gross income during the Limitation year”. Do either of these provide a reasonalbe basis for not including these amounts in calculating contributions?

PAL

We administer a small non-pbgc DB plan for a company with 10 employees. The 100% owner of the corporation recently died and the company will no go out of business. It appears the company will only have the resources to fund half of the 2006 pension contribution.

We know there is a 10% excise tax and if the deficiency is not corrected the IRS could potentially impose a tax of up to 100%. It appears we could ask for a waiver of the 100% if we can show it would cause a hardship.

Has anyone had experience with this?

the rule says you only need to file a 5500 for fringe plans associated with a welfare plan with over 100 participants. what does associated mean? our client has a welfare plan but i dont know whether they are associated.

I am filing Form 5307 for a volume submitter plan that provides that employees with more than 5 Years of Service as of December 31, 2005 are not eligible for matching contributions (don't ask!). Passing the ratio test is not a problem. There are not many employees involved and some of them are HCE's. Nevertheless, I believe that Schedule Q with Demo 3 should be filed.

1) Am I correct regarding Demo 3?

2) Where would I find instructions for Demo 3?

Thanks.

I noticed in the winter 2007 ERISA Outline Book Quarterly Update there was a memorandum discussing the IRS' review position on the disagrregation of otherwise excludable employees for ADP testing. We do not get the quarterly updates. Does anyone know where I can get a copy of the IRS review on this subject (other than the quarterly update)?

According to the EPCRS, the correction for a defaulted loan that is still within the repayment period can be a lump sum payment, or reamortization of the balance over the time remaining in the repayment period, or a combination of the two.

I'm wondering if it's possible to start making the regular payments now, and then making the missing payments at the end as a lump sum or balloon payment?

How do you all determine hours of service for employees that are on-call. My specific fact pattern is this: Employer hires nurses to answer questions via telephone. These nurses are on-call for certain nights or weekends. If they never field a call, but are on-call, should they get credit for any hours of service? What about if they field multiple questions?

Thanks.

Where a child is over the age of 18 and no longer the subject of a state custody order, is an insurer still required to provide the "custodial parent" benefit information (including possible individually identifiable health information) or would HIPAA preclude the insurer from doing so without first getting authorization from the child?

What is the impact on the plan sponsor and plan participants if a plan is disqualified solely because it failed to satisfy the minimum coverage requirements?

Can participants move their assets to 401K -- in the event of frozen 403b plan?

If you're trying to accept a direct rollover from another plan and the other plan does not have a determination letter, how do you determine if the plan is qualified or not? Do you simply wait till some future date when you are informed as to the qualified status of that plan when they DO file for a favorable determination letter?

Does anyone have an opinion on whether allocating forfeitures against a 401(m)(11) safe harbor match would cause a plan to lose the top-heavy exemption? I'm not comfortable the reallocation of forfeitures satisfies the requirements for the safe harbor contribution, and think they may be treated as a discretionary company contribution, which I believe would blow the top-heavy exemption normally given to safe harbor plans. I have read Rev. Rul 2004-13 on this several times and become more confused each time. Thanks for any input.

An employee left one company to start her own business and had a loan in the first company's 401k plan. She immediately started a 401(k) plan with for the new company, and wants to roll the loan over. However, the first company had a repayment schedule based on monthly repayments, while the new company has twice a month payroll. We can recalculate the repayment schedule based on the different payroll frequency, but would that require a new promissory note as well?