Moving forward participant directed account quarterly statements require a reference to the Internet webite of the DOL for sources of information on individual investing and diversification.

I looked at the consumer information section under dol.gov/ebsa and did not see a topic for individual investing and diversification. Should I be looking somewhere else?

Parent A owns 100% of Company X. A also owns 52% of Company Y with 4 adult children also owning 32%(8% each). The other 16% ownership is unrelated. I would just like confirmation that this would represent a controlled group since A owns MORE than 50%, thus requiring the adult childrens shares to be considered for a total of 84%. On the other hand, if A only owned an even 50%, and each adult child had 8.50% each totalling 34%, there would not be a controlled group situation between Company X & Y.

I have a Roth IRA that I would like to be able to transfer to my 401k plan at work. My company is now offering 401k roth that I can choose to change to if I want. But is there any way I can roll that Roth IRA over into a 401k traditional or roth?

Assume a sponsor of a defined benefit plan has underpaid certain participants due to an operational failure. The plan sponsor opts to correct the mistake under the SCP or VCP by making payments to affected participants that include the amount of underpayment plus interest. Does the interest payment come from plan assets, or from the employer?

Thanks for any ideas.

Existing DB client has some ownership in another entity that may or may not constitute an Affiliated Service Group (yes, it would have been nice to know that upfront, we did ask). The plan has been around a few years already. Will the IRS issue a PLR on just an Affiliated Service group issue by itself ? Or does it have to be part of a plan doc qualification submission ? Thanks.

Is there a way to correct an operational error in which a distribution was made to someone who was not eligible to receive the distribution?

I have a situation in which a participant received distribution from a 401(k) plan but there was no distribution event under the plan. The participant has since rolled the distribution to an IRA. The participant is willing to roll the money back to the plan but I have my doubts whether this will "fix" the problem or something else must be done.

Any ideas?

can anyone lend me insight re the following:

Corp A= john 25 %; pam 37%; and mary 38%

Corp B= john 15; pam 15; mary 15; joe 55

Corp C= john 33.3; pam 33.3; and mary 33.3

when applying section 1563's brother-sister controlled group analysis, do you apply the test on a one-on-one basis or as a group?

for example: would you look at corp A and corp B. corp A and corp C

and then corp B and corp A. corp B and corp C.

and then corp c and A. corp C and B?

OR

do you look at all three together and see if the 50-80% tests apply to them as a group of three companies?

thanks in advance for your help.

Please advise if my thought process is correct or not...

Participant dies 12/31/2005

Participant's DOB 12/20/1924

Participant was receiving RMD's prior to death

There are multiple beneficiaries (not an estate)

The company changed investment companies in 2005, and no 2005 RMD was prepared (new plan to me in 2006).

To calculate the RMD for the beneficiaries, I would need the oldest beneficiary's DOB correct?

I would then use the beneficiary's age to get my life expectancy factor, correct?

To calculate the RMD, I would then divide the 2004 ending balance by the factor to get the 2005 RMD, correct?

Since the participant died in 2005, I would need to provide the first RMD to the bene's by 12/31/2006, correct? I would also need to calculate the 2006 RMD...and both would be distributed before 12/31/2006, correct?

Thank you so much for any advice you can provide.

The owner of a PEO (Co. A) started a multiple employer plan several years ago. 5500s were never filed. He also owns one of the companies (Co. B) participating in the plan. He is in the process of selling Co. B. However, the buyer is withholding a substantial sum of money until the 5500s are filed. The owner would like to pull Co. B out of the group and file 5500s just for that plan. He knows he is obligated to take care of the 5500 filings for the multiple employer group, but says he needs to get his other company (Co. B) taken care of first because of all the money that's being withheld from the sale.

This sounds unethical to me, but not illegal. I'm hoping to get some thoughts from other practitioners.

I am running discrimination testing on a plan who has not had testing done all year (we just aquired them- unfortunately). Their plan ends on Dec. 31st and they are failing the 25% tests for elections, contributions and reimbursements.

How do I go about fixing this? Should I tell the employer they need to bump up the key employees pay to cover the 25% they would have saved with this plan, have them pay taxes on their full annual elections or what!????? HELP!

Can anyone tell me whether true-up matching contributions (under a plan that provides for matching contributions on a payroll by payroll basis) that have a last day of the year requirement have to be tested as a benefit, right or feature (i.e., different rate of match)?

A plan provides for early retirement at age 55 for all employees

The plan provides that early reduction factors are 1/15th for the first five years, 1/30th for the next five

The plan further provides that the benefit for Employee A, an HCE, is unreduced at 55

Clearly, this will impact A's most valuable accrual rate and I am not concerned about that, the general test is readily passed

One of the other actuaries in my office is arguing that the unreduced benefit is a Benefit Right or Feature subject to testing and automaticallyfails since only an HCE gets it

I disagree and believe that 1.401(a)(4)-4 is clear that using more than one actuarial assumption set for converting to other forms of benefits creates separate optional forms, but the amount of the benefit payable in the Normal form and corresponding QJSA are tested in the general test and not as BeRF's

Thoughts?

New to the HSA world, so my apologies on what I am sure is a basic question...

What types of funding mechanisms are available for HSAs. Must they be funded entirely through payroll deductions (If offered by ER)? Can I make a lump sum contribution with after tax savings? Do I have the ability to rollover funds from a rollover IRA (all pre tax funds) directly to the HSA?

Any insight would be appreciated!

Our volume submitter provider is recommending that all of our clients sign the Form 8905 by 1/31/2007. Don't have a problem with that, as they have provided a Word version of the form via their website. The info actually entered on the form is relatively trivial (plan name, EIN, plan number, and plan sponsor).

However, in order to produce these forms using their document software, we have to open up each plan, update it to the newest version of the language, and then build and print the form. Seems pretty time consuming for 800 plans, especially for what is essentially a nonbillable item.

My thought last night was to print out a raft of the partially prepared 8905s, and then using our existing database prepare a blank report page with the items lined up on the form. Then just a matter of loading the printed out forms, and then printing the database job. Estimate this would take a 2 week process down to about 2 hours (from experience of updating 500 SH 401(k) plans in November to generate the new SH notice).

My only question is that the form itself has those annoying boxes to individually enter each letter. I am not inclined to parse each item character by character to exactly line up; rather just align with the start of the line and let the characters fall where they lay (I've got better things to do with my time around the end of the year). Given that these are just retained forms, not sent to the IRS, does anyone think it a big deal if the characters don't perfectly line up on the 8905?

The Employer wants to buy back some shares from the ESOP. All shares are currently allocated to participants. Under what circumstances can the company come along and decide they want to buy back shares from the ESOP?

I have a plan where the participant named her spouse as (partial) beneficiary of plan benefits. The participant died (before her required beginning date). The spouse died a month or so later, before taking any benefits.

Spousal benes can roll to an IRA, and in 2007 non-spousal beneficiaries can roll to an IRA. In this case, we'd love to be able to roll the benefits out somehow, but I don't see how it's possible...the spouse is the named bene for purposes of RMDs, but the estate is effectively the beneficiary for purposes of actually making the payments, and the estate can't do a rollover.

Can anyone convince me of some way that we can get this money out of the plan in some kind of a rollover?

I've read that the "Highly Compensated Employee" status is based on prior year compensation. Is that still true if my company uses the current year testing method for nondiscrimination testing? In other words, will they use my compensation from 2006 instead of 2005 to determine whether I am an HCE for 2006?

EGTRRA changed the 409(o)(1)©(ii) limit to $800,000. Was this required to be incorporated in the EGTRRA good faith amendment?

We use access and outlook for my palm and for a database to do mailmerges. When we mailmerge a letter, we save a paper copy in each client file. Does anyone have a decent way to save a copy electronically?

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