I am hearing that an alternate payee under a QDRO may only name the alternate payee's children (and possibly the estate) as the beneficiaries of QDRO payments.

Is there a restriction?

Thanks!

If a participant has his bene a trust, do you still use the same RMD factor?

Company X offers a 125 plan that includes health care and dependent care flexible spending accounts. Employee A's son, L, has reached the maximum age of 23 and loses coverage under the medical plan and the health care FSA (which we will assume is subject to COBRA). Assume that X has decided to provide COBRA to the end of the year with respect to all qualifying events occurring during the calendar year. Can L elect COBRA for the health care FSA portion for the remainder of the calendar year? I see no reason why L cannot since he is a qualified beneficiary and has lost dependent coverage under the FSA because he ceased to be a dependent under the plan. Any thoughts on this?

Has anyone heard of a triple safe harbor match where you have an enhanced safe harbor match, a discretionary match and a fixed match?

A CPA wants me to take over a 401(k) Plan where each person has an individual brokerage account. The only contributions are Deferral and SHNEC. Since there is no vesting and no Hardship withdrawals allowed, CPA was thinking we don’t need to do annual statements showing the value of each type of money.

I keep thinking there is some regulation that requires that gains must be allocated by source at least annually?

This is a Corbel Prototype and I have not been able to find it in there.

Does anyone know of any requirement like this?

If not, would you consider it prudent in case of future law change?

When you have a SH match, does it have to go along with the typical "100% of the first 3%... etc" ? I have a new client that wants (has) the following:

2 401K plans..... 100% vested at all times

Plan 1 has a 4% max deferral limit in which they match 200%

Plan 2 there is no limit to what they can defer of course as long as they do not go over the 402g limit.

Would plan 1 be considered a SH plan?

Thanks

If someone other than the custodian/trustee prepares the form 990T, who should be signing the form? There is a space on the form that ask's for the signature of an officer and there is also a space on the form for the paid preparer's signature.

I know this has been discussed, but I don't see any clear cut answers to this question:

If an employer utilized the 3 yr testing cycle for coverage testing in 2004, how do they report coverage testing compliance on the 2005 Schedule R (assuming they also must file one and do not meet any of the other exemptions listed in the Instructions)?

Is there any problem with an employer paying broker fees outside of the plan for the participants buying and selling company stock?

A client has a PSP/401k plan. 30 employees: 5 are partners, 5 are non equity partners, 20 staff. Currently the plan excludes the 5 non equity partners (who are NOT HCEs) from the 401k and PSP contributions. They want to change the plan to allow the 5 non equity partners to do the Salary Deferral but still exclude them from the PSP.

The Plan is Top Heavy. Assuming all other testing is ok, will the 5 non equity (NHCEs) have to receive a top heavy minimum contribution?

Employer maintains a safe harbor plan. They are acquiring a number of new employees via an asset purchase. They do not want to provide the safe harbor contribution to those newly acquired employees and have been told they can operate part of the plan as safe harbor but yet go through all of the testing requirements for the "non-safe harbor" part of the plan. I have never heard of 1/2 safe harbor plan. Any comments?

Same employer as above wants to include a related employer (does not rise to controlled group or affiliated service group) creating a multiple employer plan. Their intent is NOT to have the part of the plan for this other employer be safe harbor. Since each employer in a multiple employer plan is basically considered maintaining a separate plan for testing purposes, can a multiple employer plan operate as safe harbor for one employer and not safe harbor for the other?

Company B terminates defined contribution plan. Company B is owned by Company A and part of a controlled group. John Doe worked for Company B now works for Company A who maintains a defined contribution plan also. Under a regular plan termination, John Doe would be eligible to receive a distribution, however, since he works for Company A, he would not be eligible to receive a distribution due to the successor plan rules. Is there any way John Doe could receive a total distribution from Company B's plan?

A sole proprietor employs his wife. She's the business's only employee. The sole proprietor recently adopted a SEP, and he wants to make a contribution for himself, but not for his wife.

I've never heard or read about any family exception to SEP participation. But, the FUTA exception for a family employee keeps popping up in my head, so I thought I'd post this issue just to be sure.

Could someone confirm that there are no special SEP rules for a family member, and that the owner's wife is covered by the same rules that affect any employee?

I am trying to figure out a way for an s-corp owner to receive tax-free dependent care assistance. I know that the owner cannot participate in a cafeteria plan, but is it possible to have a dependent care assistance program under section 129 where the company provides dependent care benefits to the owner, but all other employees (non-owners) must salary-reduce under section 125 to receive the benefits under the DCAP? Does this violate the discrimination rules in section 129? (Technically, the employer is providing the benefits in both situations since the 125 plan converts the employee contributions to employer contributions, right?) Any thoughts would be appreciated!

Participant is unmarried and fills out a beneficiary designation naming his sister as the beneficiary of his qualified plan account. Participant subsequently marries, doesn't change the beneficiary designation and then dies shortly thereafter. Assuming that the qualified plan is subject to the annuity rules, was wife required to consent to the designation of the sister upon marriage or is wife out of luck because the designation was completed prior to her marriage to participant? I don't see anything in 1.401(a)-20 addressing these facts. What if the plan isn't subject to the annuity rules?

Plan has discovered that company match has been capped at $5500 ( 1/2 of 11,000 2002 limit) since 2002. There are two very highly compensated participants affected..one being the CEO. Any issue with making corrective contributions with earnings assuming that there are no ACP issues. The match is computed payroll by payroll and is 50 cents on the dollar up to 6%. Any assistance appreciated

Has anyone sent in a form 5558 to extend the 5500 due date without a signature? I just read the summer IRS Employee Plan News ( http://www.irs.gov/pub/irs-tege/sum06.pdf ) and on page 3 they say a signature is not required if you are extending a 5500. The only time you need a signature is when you are extending a 5330.

My concern is, the instructions state you need a signature. If we send in all our 5558's without a signature and then the IRS decides not to accept them...ugh!

If this is correct, it is going to save us a lot of time on July 27th!

I've got my head spinning on this one for some reason. 401k plan wants to make a discretionary PS contribution but they are planning to terminate by 9/2006. My first thought is sure they can as long as they declare the contribution before the plan terminates. Then, I think, no, the declaration isn't made until the end of the Plan Year and the termination will have happened before that date. Can someone clarify this for me?

I have a situation where a small business owner that has had a DB plan for a number of years and is now past NRA could maximize his LS distribution if he were to take it right now while PFEA is expired and prior to new regs, assuming the new regs make the 5.5% interest rate on 415 lump sums permanent. The plan would continue and the plan assets would just barely cover 110% of Current Liability (based on the Treasury rate CL interest rate corridor as applies since the expiration of the PFEA bond rate corridor, and prior to any pension reform legislation).

Being cautious, I am uneasy about having him take the distribution right now because of the black box of pending legislation. On the other hand, how can there be a problem if the distribution meets all of the applicable criteria based on the law in effect at the time of distribution?

I would appreciate any input and thoughts that will help me sort this out. Thanks.

2004 calendar year 401(k) Profit Sharing Plan (earmarked accts.) that has a discretionary matching contribution. The client deposited the match into the trust (non interest bearing cash account) before the due date of the Corporate tax return (9/15/2005), but the allocation to participant accounts didn't take place until 3/15/2006.

What issues do we need to look at here? This doesn't pass the smell test.

Thanks in advance for any input!!