Can a participant submit a check to the trust to make up for deferrals missed while on active duty or must the deferrals come from current compensation upon return to work?

Hi everyone:

I have two related questions about an ER that acquired a company and found out that:

1) former employees, some of whom have not been on the payroll for years, were never taken off the acquired company's health plan, and, consequently, are continuing to be covered as "self-pay" insureds under the Company's health care plan despite no longer being an "employee;" and

2) The acquired and acquiring corporations do not have any retiree health care plans. There are a couple of retired EE who have Medigap w/ the insurance provider, which is a remnant of when they were still active EE of the acquired corporation. The EE no longer work with either corporation.

Do any of these two groups of people (terminated and retired EE) need COBRA coverage where the qualifying event, and the COBRA coverage period they would have been entitled to had they elected COBRA coverage, have expired, assuming they had they been given proper notice upon the qualifying event?

What do you all think? thanks in advance for any help you might be able to provide.

Lexi.

Has anyone seen a good summmary with examples of the new FAS standard ; I know the standard has some examples but when FAS 87 first came out the accounting houses (e.g Price & Ernst) published "working" booklets that were helpful - just wondering if anyone has seen something similar for 158 ??

As a condition for re-deferring amounts previously deferred and payable upon separation from service, 409A(a)(4)© requires that the plan requires that the payment be pushed back at least 5 years from the date the payment would otherwise have been made.

If a participant wanted to change the timing (before separating from service) so that his account would be paid out on a specified date or pursuant to a fixed schedule, does the above restriction prevent this? At the time of the subsequent election, it doesn't seem possible to know when the separation from service would occur and therefore whether the delayed payment would be at least 5 years thereafter.

Any thoughts?

I wanted to see if anyone had an opinion on the following:

Company is publicly traded now but has been purchased and will become a private company on X date. CEO has an employment agreement that says severance payment will be paid in the event of a change in control and that CEO terminates employment. Under the agreement CEO would get the severance if he was terminated in connection with the change in control or he terminated for good cause such as duties and position changed. In this situation CEO was not terminated but could have terminated under the good cause provision.

Attorneys for the purchaser want to pay the severance payment. They are relying on the transition rule in the proposed regulations entitled "Change in payment elections or conditions on or before December 31, 2006". [i know this was extended to 2007]. The attorneys for the purchaser are interpreting the rule to mean that you can change the provisions of the plan at any time during the transition period.

I was asked the following questions:

1. Would the 6 month delay rule apply to this CEO--If he actually terminated after the company became private, I believe that the rule does not apply. The regulations say that whether a company is public is determined on the date of seperation from service.

2. Does the transition rule let the terms of the plan be changed such that no actual termination is required to get the severance payment. This is where I need real help.

Thanks

I was always under the assumption that since the RMD was a mandated form of distribution that federal taxes were required to be witheld. However, my provider is telling me that they can be deferred until the participant does his taxes. this doesn't make sense to me. Do federal taxes need to be witheld?

Good morning. Please forgive the basic nature of this question, but this is the first Application for Exemption under 501(a) that I have filed. This is a single employer VEBA. I plan to file the following:

1. Welfare Benefit Plan

2. VEBA Trust

3. IRS Form 1024

4. IRS Form 8718

5. IRS Form 2848

6. Most importantlty, the appropriate User Fee.

Am I missing anything?

Thanks in advance for your help.

Ed

I am auditing a 401(k) Profit Sharing Plan that the plan administrators changed the plan year end from 11/30 to 12/31 in 2005. I know that I can defer attaching the audit report to the short plan year Form 5500 to the following plan year Form 5500. How should the financial statements be presented for the following plan year?

Statements of Net Assets Available for Benefits As of December 31, 2006, December 31, 2005 and November 30, 2005?

Statements of Changes in Net Assets Available for Benefits For the Twelve Months, One Month, and Twelve Months Ended December 31, 2006, December 31, 2005 and November 30, 2005?

At the ASPPA conference there were several references to the fact that current liability calculations for maximum deduction purposes should not include increases in current liability for HCEs in plans that are newly established within the last 2 years as well as to plans amended in the last 2 years. Jim Holland said that the reason is that a plan could terminate and start a new plan to avoid this rule. If that is the only reason for his stance, why wouldn't the rule just include as an amended plan any plan that is established within 2 years of the termination of another plan of the employer? I am hesitant to change my current procedure of using the full current liability for new plans, unless I have to, and I am concerned about my prior valuations. Any thoughts?

Christoper, please contact Dave Baker to advertise on the message board.

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A takeover client wishes to submit their plan to the IRS. Unfortunately they cannot locate the Basic Plan Document for their 1999 Benefits National adoption agreement. It appears they company was sold in 2000 or thereabouts and of course cannot be located.

This was the 'pre-GUST' document and does not have a 'Letter of Notification' to refer back to.

Does anyone have a copy or know where to get a copy for my client?

Thank you all.

In a Corbel Prototype plan, can you insert an eligiblity requirement that excludes part-time employees and still have a 3 month waiting period for all other employees?

What language would you use.

A 501© 3 has come to us and are maintaining both a 401k and 403b. It appears there are a few employees deferring to both plans in same year. I thought you could not sponsor both plans but had to choose one or the other.

Our company uses the company Intranet to communicate company news and announcements to participants. May we post the safe harbor notice and the Summary Annual Report on the Intranet as an effective means of providing the notices?

If you have a plan that covers only salaried employees and the employer does not track hours worked, must you state an equivalency for hours in the document? Is it sufficient to know that all employees are paid for x hours per week (e.g. 37 1/2) without actually tracking the hours?

May an employer sponsoring a self funded health plan mandate as a condition of continuing participation in the self funded medical plan a blood test for all employees coincident with open enrollment (please respond with citations)?

Can anyone tell me where I could find industry standards report for TPA fees?

We had a DOL person tell us our distribution fees ($80) are "exhorbitant". Would like to study.

thanks

Does anyone know of any authority on how years before 1988 (the first year of DFVC) would be treated under the program?

We have a client whose QDRO procedures (for their DB plan) specify that alternate payees can elect to receive a lump sum distribution of their assigned benefit but only if they make the election for the lump sum within 30 days of the date the DRO is determined to be qualified. A lump sum distribution is not otherwise provided under the terms of the plan (other than for a cash out). Does anyone see any issues with this? Could this be considered a significant detriment issue (although the lump sum availability could simiply be removed and A.P.s forced to wait until earliest retirement age)?

I've got several clients that want to allow HCEs to maximize deferrals, but avoid any refunds. Some of the HCEs are catchup eligible. I'm strugling to find sensible ways to formulate "Plan Imposed Limits" that will allow us to define the exact point at which catchup contributions will kick in. Two Questions:

1. Has anyone seen any software (e.g., relius, datair, etc.) that can predict ideal levels at which plans should impose limits???

2. Do you think there is anything that would prevent the following plan imposed limit (based on dates and names)?:

Facts: There are 5 HCEs. None of them will hit maximum ($220k) comp this year. 3 of the HCEs are non-owners. These three have been allowed to defer until this point, but have now been ordered to stop due to testing limits. 2 owner-HCEs have not yet deferred anything. One of them is catchup eligible (as is one of the 3 non-owner HCEs.)

Projection: I'm projecting that (on an annualized basis) there is room for aggregate HCE deferrals to increase by another 5%. I'd like to allow the young HCE-owner to use up that 5 percent. I'd like to allow the other owner to defer (only) the $5k catchup.

Plan Limit: Do you think it's feasible to draft a plan resolutions that limits as follows for 2006 only:

a. Non-owner HCEs cannot make any further deferrals after October 31 - other than catchup.

b. Younger owner-HCE can make deferrals, but only up to 5% of pay;

c. Older owner-HCE can make no deferalls in 2006 other than catchup.

It seems insanely fine-tuned, but permissable, to me. Do you have any thoughts as to alternatives?

Thanks very much.