If an employer has never requested or reported FAS information in the past, but will do FAS reporting this year, do you agree that the correct approach would be to start with a net obligation/asset for the current reporting year, rather than reconstructing the FAS accounting back to the start of the plan?

Blackout notice was timely provided to some but not all participants when changing recordkeepers. Blackout period still in effect Is there any cure for the failure to provide the notice to all? Is anyone aware that DOL has taken enforcement action for such failure to provide notice?

Employer X is in the process of designing a new 401(k) plan for certain of its employees, effective January 1, 2008. Based on the last digit of its TIN, Employer X's cycle under Rev. Proc. 2005-66 is Cycle B, which ends February 28, 2008. Does Employer X need to file its newly established 401(k) plan by February 28, 2008 or risk filing off-cycle?

My client sent out a notice in November 2006 for a Safe Harbor Basic Match in 2007. A week ago, he changed his mind and now wants to just do a regular profit sharing contribution.

My question is, what type of amendments/notices should I prepare for him?

I am guessing the partiicpants need a 30 day notice. But during that 30 days is the plan still considered Safe harbor? Even though the company has made no match yet this year?

Thank you for your responses!

I have a 401K, opened less than a year ago. I chose to invest it in the Target 2035 Vanguard Retirement Fund. A year of employment is about to pass, which means my 401K will receive 40% of every dollar i contribute. I understand the value of free money, so i will maximizing this opportunity.

I'm also starting a Roth IRA with Vanguard. Does it behoove me to pour more money into the same Target 2035 Retirement fund by way of the Roth? Instead, should I consider another fund for the sake of diversity?

For many years I have heard the term Section 79 plans. When I do a search on the topic all I see is some blurbs about group term life insurance. I don't even get a google ad in the margin. These can't be very popular if no one is willing to pay a nickel for a targeted ad search.

Anyway, I get the impression that the 412(i) crowd is looking around for a new code section. I am meeting with someone Thursday to convince them that their clients don't need to be involved in a Section 79 plan, but I really don't know enough to talk about it. When the financial advisor first asked if I knew about Section 79 plans, I got confused with Section 72(t). I'm sure I am not far off with the 412(i) reference because if you do a search for "Section 79 retirement plan" you will get a 412(i) plan website that is now pitching section 79 plans.

From what I can determine Section 79 is not a qualified plan, but they claim to be tax deferred. They have something to do with insurance.

I feel like I know where this is heading, but anyone here know if anything is going down?

A this time I would like to obtain a table of UP84 mortality rates for ages 16 or so to 111.

Where can I get this table? And other tables as necessary?

Thanks.

New Plan effective 1/1/06, signed in December of 2006, EIN ends in "1"

Must this plan be submitted by 1/31/07, or since it is a new plan, do we have until the due date of the tax return, or 3/15/07, plus extensions?

Thanks (and what happened to the board covering these items?)

An insured frozen defined benefit plan is funded using the Unit Credit method. Insurance is valued using the current cash values in the assets, and adding a term cost to the Normal Cost. Since no benefits are accruing the Normal Cost = -0-. Should the term cost also go to -0-?

A small client has two common law employees. The client recently established a cross-tested retirement plan program. Under the defined contribution component element of the cross-tested program, these common-law employees receive/are eligible to make (1) elective deferrals, (2) 3% safe-harbour non-elective contributions and (3) profit sharing contributions.

As the contributions under (1) and (2) above are 100% vested, the client asked if these amounts could be held in a single account. As the profit sharing contributions are subject to a top-heavy vesting schedule, they would be held in a separate account.

Is there anything that would prohibit the client for establising a single account for each employee with respect to elective deferrals and the 3% safe harbour contributions?

Thanks in advance for your thoughts.

Ed

A 401(k) plan limits elective deferrals to 15% of compensation. Compensation does not include commissions. After the end of the year, due to the fact that the non-highly compensated employees were payed large commissions, the amount of compensation for the HCE's that can be considered to get a passing eligible compensation ratio is lowered, which increases the deferral percentage. The NHCE's are deferring at a good rate so there is no real inpact on the ADP test. However, the percentage for the HCE's is now over 15%.

Can this be corrected with a distribution?

I am new to this area so I need a little assistance.

Is there a new ruling with respect to the impact of deferring a benefit? This is all of the information I was given, other than the fact that it was under PPA.

I have done some research and have not come up with anything - any assistance, with the appropriate cite, is appreciated.

Thanks.

In 1999, an individual contemplated converting a traditional IRA to a Roth IRA. However, as the individual's AGI was several hundred dollars over the threshhold amount, this was not possible. However, the custodian opened up a Roth IRA for the individual. The individual never paid taxes on the conversion as he claims he was not eligible to do the conversion.

Is there anything the individual can do at this point? Any corrective programs?

One thought is to roll over the amount in question to a new custodian and establish a traditional IRA. I'm not sure if anything else can be pursued at this late date.

Thanks in advance for your assistence. Ed

We have a frozen DB plan and the CPA is asking us if she should check Box 13 of the W-2 (Retirement Plan). Any thoughts?

Thanks!!

Please help. I am working with a new client (as of January 2007). They sponsor a 401(k) plan that is currently on an individually designed plan document. In addition, they are a Cycle A filer. The plan appears to be up-to-date through the final 401(k) regulations amendment. We understand that the document should be restated for EGTRRA and sent to the IRS for a determination letter by January 31, 2007.

However, the client is considering moving to a prototype document, but is not sure and would like additional time to make some decisions about the plan, not only prototype versus individually designed, but also design features. How should they proceed?

For instance, if they sign a Form 8905 by the end of January 31, 2007 should they adopt a new EGTRRA document by January 31, 2007 in case they want to be an individually designed plan?

If they sign a Form 8905 in January, then in March (for example) can they change their mind and remain an individually designed plan and submit for a D.L. even though it is now Cycle B? What are the consequences of off-cycle filing?

Any guidance would be greatly appreciated. Thank you!

If a self employed (unincorporated) business later forms a partnership (PLLC), does all service start over if want to establish a SEP for the PLLC or can prior service be recognized.

My company recently went through a change in ownership and eliminated the 401(k) plan. I'm in the process off rolling over the 401(k) into a traditional IRA. I also have a Roth IRA. Can I contribute the maximum of $4000 into each IRA? That is $4000 into the traditional and $4000 into the Roth IRA. Thank you to any one who has any accurate information.

My wife works for an employer who uses Merrill Lynches Prototype SIMPLE IRA documents. The adoption agreement clearly states that Merrill is not acting as a designated financial insitution. The salary deferal agreement clearly states that participants can invest their contributions at the financial institution of their choice if there is no designated financial institution, which there clearly is not. However, the financial institutions we have asked to open accounts say they cannot open an account using Merril's adoption agreement and the employer must sign an IRS model 5304 for accounts not to be held at Merrill. But this doesn't make any sense. How can an employer sign multiple adoption agreements on different dates? Can financial iinstitutions accept other financial insistutions' prototype SIMPLE IRA adoption agreements. If not, this would seem to defeat the IRS intention that participants control their SIMPLE IRA accounts including where they are set up.

A defined benefit plan has a proposed termination date of 2/28/07. The current plan document offers 50% and 100% joint and survivor annuities as optional forms of benefit. Are there new PPA rules which require this plan to offer 66 2/3% or 75% as an option? Or can we continue and offer just those two forms of benefit besides single life?

A participant over 70 1/2 in a MP plan has terminated. It is a 9/30 plan year but we have the account balance as of 12/31/06. The 9/30 contribution has not yet been deposited. I know that in general, we do not have to accrue the contribution in to the balance for the calculation, however, for a terminated participant, should it be accrued in? Otherwise, when the contribution is deposited at some point this year, that amount will be rolled over in full.