I know this is a DB board, but wanted to submit this here, since many DB practioners/actuaries also administer DC plans.

A law firm has two plans.

One for Associates - 401k only

One for Partners and support staff and some other attorneys - 401k, 401m and PS

Under the ABT for the partners plan (for eg.) when computing the allocation (or benefit accrual for cross testing) my understanding is that all non-excudable employees, are given an employee benefit percentage and included in the ABT test, as opposed to just the participants in the partners plan, even if the partners plan is to perform the general test on an individual plan basis?

And furthermore, all allocations (or benefits) are combined from both plans, including elective deferrals?

And that the rate groups for PS non discrim testing are based on just the participants in the partners plan and exclude elective deferrals (just PS allocations included)?

For coverage testing the 401k, the 401m and the PS portions of the partners plan are all tested separately and must each pass?

Thanks and interested in any differences of opinion (if they exist).

This question has come up before but after MUCH searching, I'll be darned if I can find it.

Say a plan and its sponsor co-invest in a piece of real estate. Because of certain minimums, the sponsor would have been unable to invest in that property without the co-participation of the plan.

I seem to recall that the conclusion on the missing post is that this IS a problem because a disqualified person is benefiting (in terms of ability to participate) from the transaction.

Can anyone elaborate?

We will be hiring a new employee who will pay COBRA premiums to hhis previous employer during our pre-ex period. We are considering reimbursing the employee for the COBRA premiums. It appears that Rev. Rul. 61-146 allows this to be done on a non-taxable basis. Correct? Anything else I need to know before we say we're going to do this?

Thanks,

Ken Davis

Plan Year End is 6/30/06.

Owner's D/O/B is 10/7/35, therefore becoming 70 1/2 in May, 2006.

When I calculate his first RMD, can I use the 6/30/05 valuation ending balance, or do I have to do a special valuation to figure out his 12/31/05 balance and calculate it from there? What account balance date would I use for the first RMD and then what would I use from that point forward?

Any thoughts?

Hi, I am in the process of closing out a plan that now has two ppts. One of them cannot be found. I've done my due diligence with search firms and the SSA letter forwarding service. I have the form for the state of Ohio's unclaimed property dept.

My question is: do I submit the gross amount of the account or have Fed withholding taken? Either way he won't receive the 1099-R unless he happends to come forward later this year, which is unlikely. If he ever claims the money from the state, he'll need to remember to include this on his tax return as the state isn't going to issue a 1099-R.

Thanks!

Is there a rate group issue with establishing Employee Groups by compensation level?

A new plan has 620 participants at the end of its initial year.

Can the plan file a Schedule I, instead of a Schedule H? We determine a "small plan" by the number of participants at the beginning of the year. For a new plan, of course, the opening count is 0.

Can I use Schedule I, or would that be cheating?

A 200-participant 401(k) plan is contemplating moving from Fund Company A to Fund Company B. Fund Company A has indicated that it will impose a fee of 1% of the last 12 months of purchases of some of the fund shares, with the total fee being roughly $8,700. The plan sponsor is willing to absorb this cost.

Fund Company A is also indicating that it must assess these fees directly from participant accounts. If it does so, and the plan sponsor immediately makes the affected participant accounts whole, would these reimbursements be considered plan contributions (thus subject to 415 and 404 limits, etc.) or sponsor expenses?

My research turned up nothing directly on point. This does not seem to be quite the same situation as revenue Ruling 86-142 (payment of commissions on securities transactions within a plan are plan contributions, not sponsor administrative expenses.)

Any insight and thoughts would be much appreciated.

Can the trustees of a multiemployer plan force a withdrawal of all employers, thus triggering withdrawal liability? Do the employers have the right to refuse this forced withdrawal imposed by the trustees?

Can anyone give insight on how they set their benefit credits for their full cafeteria plan? Our client is using years of service but wanted to see other options. Thanks!

Plan effective 4/1/04, with 9/30/04 PYE, so 2004 form is filed for the first plan year because it began in 2004.

Now for the 9/30/05 Plan Year, I need to file another 2004 form because that plan year began in 2004.

Will the DOL get confused (i.e., will the software program spit it out)? I'm wondering if my intitial form should be filed on a 2003 form to avoid confusion (obviously, I would indicate the appropriate plan year in the space provided).

Do foreign taxes get reported under expenses or earnings when filing the Schedule I?

Does compensation used to calculate matching contributions in a safe harbor plan have to match the compensation eligible for deferral?

Can an unmarried employee change his distribution election after he's already started receiving pension benefits?

I am desperate for some help regarding the following scenario:

We have a DB plan that is converting into a DC plan. However, there are some EE working under a CBA and some EE who are over 65 years-old who are going to stay in the "old" DB plan without being moved over into the new DC TSA plan. So, in effect, a 64 year-old EE will be moved over while his/her 65 year-old colleague WILL not.

In addition, under the new TSA plan, the participants will receive 18% more in contributions than under the old DB plan. So, in effect, the 65 year-old EE will not receive as much as their younger counterparts under the TSA because of their age.

Now, here are my questions:

1) Does this differential in contributions for 64 year-old EE and 65 year-old+ EE violate the ADEA since the 65+ EE technically are receiving exactly what they are entitled to under the old plan even though they do not have the same level of benefits under the new plan? They are going to be in the new TSA DC plan, but they are not going to be grandfathered in at the same 18% rate. However, they are going to receive everything they were promised under the old DB plan--there is no cutback or discrimination under the old plan. They will continue to accrue service credits under both the old and new plans but the level of benefits isn't going to change from what they were promised under the old DB plan.

2) Has anyone read any articles about converting DB plans to DC plans in any notable magazines like the ASPA or Journal Of Pension Compliance that might be helpful in this matter? Anything that deals w/ converting a DB plan to a DC plan would be helpful at this point.

Thank you in advance to anyone who can help me w/ this issue.

I am desperate for some help regarding the following scenario:

We have a DB plan that is converting into a DC plan. However, there are some EE working under a CBA and some EE who are over 65 years-old who are going to stay in the "old" DB plan without being moved over into the new DC TSA plan. So, in effect, a 64 year-old EE will be moved over while his/her 65 year-old colleague WILL not.

In addition, under the new TSA plan, the participants will receive 18% more in contributions than under the old DB plan. So, in effect, the 65 year-old EE will not receive as much as their younger counterparts under the TSA because of their age.

Now, here are my questions:

1) Does this differential in contributions for 64 year-old EE and 65 year-old+ EE violate the ADEA since the 65+ EE technically are receiving exactly what they are entitled to under the old plan even though they do not have the same level of benefits under the new plan? They are going to be in the new TSA DC plan, but they are not going to be grandfathered in at the same 18% rate. However, they are going to receive everything they were promised under the old DB plan--there is no cutback or discrimination under the old plan. They will continue to accrue service credits under both the old and new plans but the level of benefits isn't going to change from what they were promised under the old DB plan.

2) Has anyone read any articles about converting DB plans to DC plans in any notable magazines like the ASPA or Journal Of Pension Compliance that might be helpful in this matter? Anything that deals w/ converting a DB plan to a DC plan would be helpful at this point.

Thank you in advance to anyone who can help me w/ this issue.

I need to have a sample, prototype agreement for outsourcing Cobra administration to a third party vendor. My legal area wants sample language that should be standard in contracts like this. If anyone has an agreement to share, can you please email it to me at ann@sageviewconsulting.com. Thank you.

Retirement plan client called and asked about filing a 5500 for their cafeteria plan. I wasn't sure so figured I'd solicit help from the experts.

Plan has three components: Medical Premium payment, Dependent Care Reimbursement FSA, and Unreimbursed Medical Care FSA. Up until this last year all were funded with employee dollars.

The last 5500 was filed in 2001. It was filed along with only a Schedule F. Plan has (and always has had) under 100 participants.

The medical premium is paid every pay period. But, obviously, the FSA's have assets that need to be tracked.

I don't believe a filing is required, but should they have been filing? If so, what Forms should have been included?

This year the plan also has a matching feature where the company will match 25% of all employee dollars contributed to the medical FSA up to a max match of $455. Does that change the answer? No HCE's participate so discrimination testing issues.

Any help provided will be much appreciated.

I am curious if there are different opinions on this question. If a change in pre-retirement interest from the previous valuation is made, do you think that interest rate is in effect for the entire plan year or starting with the valuation date? I understand it's a moot question for a BOY valuation date.

But for an EOY valuation it does have an effect, so I am curious if everyone has the same opinion. I will withhold my opinion for now.

I am preparing a final 5500ez.

Question :

All my plan assets from a profit sharing plan went directly into my IRA account. Is it proper ot list it on line 10d. ?They were rollovers as well as direct transfers.

Thank-you