I am wondering if any of you could opine as to the Service's level of enforcing nondiscrimination rules under 105(h) - specifically a waiver of eligibility waiting period for employees at the vice-president level or above, most of whom constitute highly compensated individuals.

I believe a goodly number of non-profit organizations maintain self-funded plans with provisions like these, which are common and permissible in fully insured arrangements. I am wondering if anyone has ever seen adverse tax consequences befall individuals in such arrangements.

I am confused on the impact of an ADP test failure and catch-up recharacterization on future salary deferral contributions.

A 401(k) plan year ends on 9/30/06.

For calendar 2005 - the deferrals for an HCE (over 50) were $12,000. -

Also no catch-up due to ADP testing from the 9/30/05 Plan Year

For the period 10/1/05-12/31/05 deferrals for an HCE were $3,000.

For the period 1/1/06-9/30/06 deferrals for an HCE were $15,000.

For the plan year ending 9/30/06 the ADP test is failed and the maximum allowable deferral for testing is $13,000. Of the $18,000 deferred for the plan year $5,000 will be recharacterized as catch-up for 2006.

For the period 10/1/06-11/30/06 the participant has deferred another $5,000. Since he has already had $5,000 recharacterized as 2006 catch-up, how would these additional deferrals be treated? Would they need to be returned to him as excess contributions, if so, by what time, or could they remain in the plan since the total calendar year deferral remains under $20,000?

Can the deferrals be characterized as follows?

Non-Catch-up contributions from 1/1/06-9/30/06 - $10,000

Catch-up contributions from 1/1/06-9/30/06 - $5,000 - ADP test failure

Non-Catch-up contributions from 10/1/06-12/31/06 - $5,000

Hi, I am just a regular person looking for information. I am 41 years old. I resigned from my employer a few years ago. I left behind a balance of $27,000 in my 401(k) Plan. I didn't do anything to roll it over or anything. I am now unemployed and need access to the money. Is there any way that I can get the money? If so, what types of penalties or fees will I pay?

Thanks.

PSP will soon terminate. The PSP holds a "life ins contract" as one of the plan investments for participant X.

Can participant X roll her "life ins contract" from PSP to IRA ?

I've had some people (insurance agent , a high school bookkeeper, a minister, etc) tell me it is impossible, some say it can be done with difficulty, others say it's no problem.

I have never run across this situation before. Can anyone advise ?

I've got a number of plans that terminated and paid out in 2006. Do they still need to sign a final 401(k) amendment?

I was under the impression that any plan that still had assets in 2006 had to do it, regardless of when the plan actually signed a termination resolution, but I've been hearing some say that's not the case...

Thanks!

Must members (participants) the hold HSA investment account receive a 30 day blackout notice is the investment provider is changed? I'm thinking along the same lines as the blackout notice with a conversion of a 401(k) Plan.

Can anyone direct me to a resource for a sample RFP for a 401(k) Plan? Really don't have the time or inclination to "reinvent the wheel" when I'm sure somebody's already got a good one.

Thanks!

Post-Enron there has been a tremendous amount of press regarding investments in employer stock through tax-qualified plans. As a result, many nervous 401(k) Plan committees are either terminating the investment option or limiting the option in fear of a decrease in the stock price - followed by litigation for breach of fiduciary duty. With that being said - what if a company has maintained an employer stock fund in its 401(k) Plan for several years and as a result of media pressure (not the returns on the fund) decides to limit participant investment in the fund to 25% of their deferrals (the limitation would be on a prospective basis). A year later the company is sold for 2X book value. Can the participant's sue the fiduciaries for breach here? If the only reason for limiting the investment was paternal (i.e. we can't trust you to diversify so we will force you to diversify by limiting your investment in the company stock) or because the company was afraid of a lawsuit. Is there a breach of fiduciary duty for "missed opportunity" on the part of the participants to share in the windfall? Any thoughts???

Does anyone know if a prohibited transaction exemption exists for a company director who would like to provide investment advice for the company's pension plan trust? The director is not a member of the plan committee and is not an employee of the company.

The IRS has blessed the mortality tables contained in IRC 404 regulations under Standard mortality tables. I seem to remember seeing something that also permitted the use of GATT and GAR. Am I mistaken and if not would someone please provide a cite.

Thanks in advance.

The HIPAA regs talk about special enrollment rights for dependents of "current employees." Do we have to give spec. enrollment rights to dependents of retirees?

Are there standards or guidelines anywhere that determine the minimum adjustment to face amounts or the maximum "administrative delay" period before a new policy is issued for a new participant?

Example: Plan provides that life insurance is purchased equal to 100 X the anticipated death benefit. In year 2 the formula would call for a $10,000 increase in the death benefit. The agent says the minimum increase is $25,000. My impression was that an adjustment standard above $5,000 or so was not allowed, but I have yet to find this in print.

In year 2 a new participant enters 1/1 and insurance must be purchased. By when?

The plan document is silent on these matters other than that the insurance face amount must be 100 X.

Is there anything in print that addresses these issues?

Ok do the new vesting changes HAVE to be 6 year graded or a 3 year cliff OR can they be just as generous?

The answer is: J.D. 'Nancy" Drew and Julio Lugo

Sample question:

1. What player signings by other teams might please Yankee fans?

Has anyone ever terminated a plan and not immediately distributed all of the plan's assets?

It has always been my understanding that a plan must complete distributions within an administratively feasible period of time following its termination or else it was considered to be an ongoing plan subject to qualification, funding and reporting requirements. Generally this means the plan must complete distributions within a year of its termination, but the plan may wait until it receives a favorable determination letter until making final distributions

However, the instructions to Form 5500 seem to contemplate a situation in which a plan terminates but does not distribute all its assets within a year.

Specifically, page 7 states:

"If the plan was terminated but all plan assets were not distributed, a return/report must be filed for each year the plan has assets. The return/report must be filed by the plan administrator, if designated, or by the person or persons who actually control the plan's assets/property."

Has anyone ever terminated a plan, but not distributed all of the assets? If so, how long have you kept assets in a plan after "terminating" the plan? Why did you keep some asset in the plan (were some assets illiquid)? Did the plan sponsor continue to keep the document up to date and file 5500s?

We are heading towards paperless and are starting to use a software called file cabinet. (FWIW, there are some really neat features in "file cabinet")

My situation: When I am in excel or relius administration reports, the best way I know to save to "file cabinet" is:

File

Print

choose a printer called file cabinet CS

This works to save to file cabinet in the right drawer and right folder. But it also prints a paper copy on my HP Printer.

My question: Does anyone know how to stop a paper copy from printing?

Cna yuo raed tihs? Olny 55 plepoe out of 100 can.

i cdnuolt blveiee taht I cluod aulaclty uesdnatnrd waht I was rdanieg. The phaonmneal pweor of the hmuan mnid, aoccdrnig to a rscheearch at Cmabrigde Uinervtisy, it dseno't mtaetr in waht oerdr the ltteres in a wrod are, the olny iproamtnt tihng is taht the frsit and lsat ltteer be in the rghit pclae. The rset can be a taotl mses and you can sitll raed it whotuit a pboerlm. Tihs is bcuseae the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe. Azanmig huh? yaeh and I awlyas tghuhot slpeling was ipmorantt!

(This was sent to me in an email; I'm not sure if the 55% figure is accurate. I can read the darned thing almost as fast as usual! Wierd. -- Dave Baker)

More than 6 mths ago the participant paid medical expenses with his credit card. Today he says he can't pay the CC and wants a hardship for these expenses. My gut is telling me that this won't fly as a hardship distribution. Plan document uses safe harbor hardship requirements. Thoughts?

I am working with a company to increase participation in HSAs. Currently, employees contribute to their HSAs on an after tax basis and the Company also makes a contribution to the HSA. The Company has a cafeteria plan and wants to determine whether is makes sense to amend the cafeteria plan to provide for pre-tax contributions, rather than continuing the post-tax procedures -- thoughts???

I have a client that has 5 companies all are Sub Chapter S corps. with 2-3 people owning shares of that company. The question came up as to whether or not they could set up and administer 1 plan that covers all companies with 1 common person with shares in every company or if they should split up into 5 separate plans.

The want to set it up to allow as many of the owners to participate in the plan. If they set it up separatly, the shareholders cannot participate. But, if they were to set up 1 plan, would any of the other shareholders be eligible to participate ? Would they be considered a shareholder or would only the 1 person with common ownership be considered the sole shareholder ?

I hate tricky questions !