Is it allowable to amend a cross tested plan to allow owners (through family attribution rules) to opt out of participating in the plan, so as to allow higher allocation rates for those remaining? If so, what are the operational requirements (signed opt out forms, etc.)? Any cites also appreciated.

I want to make sure I understand something. Is there ALWAYS a short plan year (meaning that limits are prorated as applicable) in a termination year if the plan does not terminate as of last day of the plan year?

I dont have too many specifics but was asked this question.... in general...

If one company is merged/purchased with/by another company and the plans are merged... I was told no but, do the participants of the plan being merged into the purchasing company plan have the option to take a distribution instead of just rolling their balance into the new plan?

I ask because a question came up that maybe the investment choices in the new plan are not desired by the participants of the plan being merged.

Thanks

For self insured plans, how are the monthly rates (accruals) calculated?

I know that the insurance provider would develop the administration and stop loss fee however for the monthly rate required to cover claims (and charged to employee and employer) is this developed by the insurance provider, or by the company or companies broker?

Employee left company in March 2006. Became eligible to defer 1/1/06 but chose not to. Employee did not earn $5000 in 2006. Employer makes 2% nonelective contribution after year-end. Is employer required to make a 2% contribution for this employee?

A new client has let us know he is extremely behind on filing the Form 5500 EZ for his plan. He is the only employee and assets are well over $100,000. In reviewing the information for the DFVC program, it appears it only applies to Title 1 plans. Obviously, this plan is not a Title 1 plan.

Is anyone aware of a voluntary correction program for non Title I plans?

Thanks!

I am not clear on the difference between the life expectancy table in 1.401(a)(9)-9 and 1.72-9. I am attempting to determine the life expectancy of the beneficiary of a participant who recently died. I would have thought that the 401(a)(9) minimum distribution regs would control, but I noticed the plan cites to 1.72(p) regulations (the plan permits a payout over the life expectancy of the beneficiary). I'm not sure if this is optional, or if I am missing the amendment to the plan for the 401(a)(9) regs.

Also, which table would apply if this were an IRA?

Thanks for your help!!!

Employee deductions were made from their payroll, but a check from the year 2005 which was mailed was never received by the carrier. Some of the employees have left the co. How do we resolve this?

(non-erisa plan), about 20 EE's.

A specified employee terminated in November, 2006. The plan provides that individuals will receive distributions upon termination; however, a specified employee must delay payment for six months.

Is the distribution amount reportable as income for the specified employee in 2006, when there apparently is no longer a substantial risk of forfeiture, or in 2007 when the amounts are actually/constructively received?

The IRS recently highlighted the treatment of required minimum distributions for defined benefit plans.

In particular, cash balance plans were singled out for these calculations because of the confusion they cause.

A cash balance plan is a defined benefit plan. When a participant is required to take a minimum payment, the account is converted to an equivalent monthly benefit using the plan's actuarial equivalence assumptions.

That monthly benefit is paid as an annuity form of payment for RMD purposes.

A cash balance plan is not a defined contribution plan. You do not have the ability to use DC rules on the RMD.

The only way to use the DC rules is if the CB plan is paid out into a lump sum distribution as a rollover during the year that payment is due.

The buyer is the successor employer and hired all of seller employees except two who will be working for buyer as independent contractors. Buyer is assuming COBRA obligation (buyer has a health plan, seller does not). Buyer's plan excludes independent contractors. Under 54.4980B-9 Q&A 6, an asset sale is a qualifying event with respect to covered employees unless the buyer is a successor employer (it is) and the employee is "employed by the buying group." Are the independent contractors treated as "employed by the buying group" thus there is no qualifying event or must they be offered COBRA?

Thanks for any help.

What is considered an Affiliated Service Group for retirement plan issues.

This is requesting a quick answer(I know it is late in the year), for a situation where there is:

1)W2 income with a 401k that gets contributed maximally with matching by employer

2)K1 income that is subject to SE tax from an LLC partnership due to a consulting agreement...equal partners only. No employees.

3) 1099 income outside the LLC

All for the same person...

Want to know if the 1099 and K1 incomes can be pooled to make a larger DB plan contribution. This is the first year we will be doing a DB plan

An LLC was set up with 8 medical consulting partners. Can the SEP IRA be set up now by the LLC and funded for the 2006 year by the LLC in 2007 and also for 2007 that same year? I presume that taxes will be filed April 15, 2007 for 2006.

I suppose that the contributions to the SEP will be deducted from the parners' income... by the LLC?

are elective deferrals included in calculating the abp in a straight new comparability ps? or in a cash balance plan/401(k) plan?

I'm getting mixed signals from what I read.

Participants self-direct & under PPA must receive quarterly statements. Do those quarterly statements have to contain vesting or is it sufficeint that vesting be included on an annual statement only? If I could get a cite to the correct PPA provision that would beneficial.

Thanks in advnace for any guidance.

I am looking at a plan that allows for hardship w/d, loans, and age 59-1/2 inservice w/d (this is a 401k plan). The owner would like to eliminate at least 2 of these 3 provisions. Is that allowable, or are all 3 considered protected benefits, that may only be allowed to be removed for new participants?

Thank You.

Company A has a 3 year cliff vesting schedule but no employer contributions have been made (401k only so far). Company B has a 5 year graded schedule. Company A is merging into Company B. Even though there are no ER contributions in Co A’s plan do we have to allow the participants the right to choose the 3 year cliff if they have at least 3 years of service? I know the answer is yes if there were actual $$s.

Could an employer choose to freeze or terminate a SIMPLE 401(k) and then start a regular 401(k) during the middle of a plan year? Does anyone know of a good reference book for SIMPLE 401(k) and SIMPLE IRAs?

Thanks!

Participant in a 401(k) plan died 4 years ago and his daughter has been receiving about $10,000 each year and her final payment (due to 5 year rule) of approximately $300,000 needs to be distributed in 2007. Can the daughter roll the remaining benefit to an IRA in 2007 and disburse each year $10,000 from the IRA? Would she be allowed to take only the minimum distribution based on her life expectancy from the IRA? The father died before his required beginning date. Thanks!