Are there any rulings regarding purchasing land from your IRA?

Plan is a large multiple-employer 401(k) plan which has adopting employers all across the country. Typical adopting employer is a small firm which is on the very "low side" of sophistication. Processing is further complicated as adopting firms have varied payroll cycles (no standard). Deferral data is required to be sent to a "central site", which processes actual deposits for all adopting entities. Given that the 15th of the following month is no safe harbor, how should (or can) one determine when deferrals should be deposited to satisfy the "timely standard" of the DOL?

We recently received payment of the plan's share of a class action settlement on our Company Stock. Although it is a nice payment, it only represents about one tenth of one percent of the Company Stock Fund.

The plan's recovery was based on its calculated loss, which was in turn based on net omnibus account level purchases over a period from 1999 to 2003 at a price higher than the specified trigger price. We could allocate the recovery to a participant level based on a calculation similar to that of the claim. But that raises the following issues:

- Many of the participants have terminated, and taken a lump sum. We could track them down but it would be expensive.

- The recovery was based on days with net trading activity resulting in a purchase over the trigger price. It was not based on participant level transactions.

- The cost of an allocation based on the original claim calculation would be very expensive.

So the decision on how to do the allocation is undoubtedly a fiduciary decision, but I am looking for ideas on what might be a reasonable, cost-effective approach.

ok - this one goes back a ways...I know there were posts, but have been unable to find them...

What, if anything, would happen if an Employer was making the 401(k) deposits on say, Wednesday, but the actual payroll check date is Friday? Wasn't there something in the Regs about this being a "bad" thing because participants were receiving an allocation to their 401(k) account prior to actually receiving their payroll $ ? Most paychecks checks are paid for time worked, so the employee has earned that money already.

Any & all thoughts appreciated.

Does anyone have a copy of the "Padilla Memo". The memo issued by Carol Gold on March 13, 1998? Thanks.

Have a company that decided to terminate its 401(k) Profit Sharing Plan. As of the end of the plan year (12/31/2005) they had not yet paid out the trust assets.

We are assuming that on page 2 of the 5500 where you detail the employee count, those participants (who are still active employees with the plan sponsor) would be counted as active participants with account balances. Or, would you consider them terminated with future benefits?

ok, no missing bodies or anything.

Plus this is the Simpsons and I am going to assume you have watched them too many times to count.

I haven't, and I am not a big movie fan, but I was still able to identify from the pictures most of the movies they were imitating/making fun of/spoofing/whatever.

but heck, its Friday, sit back and have some fun.

21 movies to identify

A plan has 5 active participants and 1 terminated participant. Two of the actives are owners. The 3 non-owners are laid off.

a) Did the plan experience partial termination?

b) If yes, does the previously terminated participant become 100% vested also?

c) Suppose only one employee was laid off (1/3rd of non-owners). Is there a partial termination? What if two were laid off?

Our plans provide for a specific lifetime maximum on "medical coverage." Can we count the premiums we as a company contribute for the medical coverage in this maximum? Is there any case law out there on this?

A single participant with > 10 years service is terminating on 6/30 and is set to receive a lump sum on 9/1.

The question is will there be any benefit if she dies between 7/1 and 8/31?

The plan document seems to discuss what happens when a married participant dies prior to receiving benefits but not for single participants. However, there are two sections I am not quite clear on as I've never had to interpret them:

Election of Beneficiaries

Each Participant shall designate in writing in the form and manner prescribed by the Committee a Beneficiary to receive the benefits payable under the Plan by reason of the Participant's death if Sections 5.2 (Retirement Annuity Requirement) or 5.3 (Survivor Annuity Requirement) are not applicable....

Procedure in Absence of Election

Wherever provision is made hereunder for the payment of any death benefit not governed by Section 5.2 (Retirement Annuity Requirement) or 5.3 (Survivor Annuity Requirement) and there shall be no properly designated surviving Beneficiary, such benefit shall be paid to the following person or persons if they are living on the date of the Participant's death...:

a) Spouse; or, if none, then

b) Equally among the Participant's children; or, if none, then

c) Participant's estate

Thank you.

Employer has a 401(k) plan. Employees are paid a low base wage and also collect tips. Although the full amount of the tips are reported as income, the employer allows the employees to take cash tips home with them the day they are earned. This leaves very little actual compensation for purposes of elective deferrals and the payment of participant loans.

In a case where there is insufficient compensation to make the deferrals AND the loan payment, I believe the employer is responsible to contribute the compensation toward the deferral first. Anything left over would then be used to pay the loan. Someone is telling us that if there isn't enough compensation to make the full deferral that the employer is responsible to make up the difference. This makes absolutely no sense to me. Does anyone have any thoughts on this?

I'm having an interesting discussion with an ERISA attorney, and anyone's thoughts or input would be appreciated.

The attorney believes that Schedule C, Line 2, Box (b) can never be answered "None". She argues that the ERISA definition of a "party-in-interest" includes a "person providing services to the plan". If an individual or company is being listed as a Schedule C service provider, the entity is, by definition, a "person known to be a party in interest".

This is the first time that I've ever encountered this interpretation. I've worked with countless Schedule C filers that, on advice of and review by legal counsel, answered "None" if the service provider isn't a plan fiduciary.

What's your take on this?

We have section 105 health care reimbursement plan which reimburses employees for out of pocket medical expenses. We have a plan document for this benefit and it extends to all full time employees.

However, we also have an arrangement with some employees to reimburse them for individual health insurance premiums but we have no plan document as I did not believe one was required.

Can anyone confirm this for me?

Would such a plan allow for the reimbursement of "group insurance" that was not the employer's? For instance, some of our employees are covered through Tricare (Retired military) and they pay Tricare premiums to the government. It is a group plan but I do not believe their payments are pretax so would we be allowed to reimburse them for this expense as though it were an individual health care cost?

Thanks for any help/guidance.

Lisa

Below is the applicable ERISA statute and the relevent underlying reg. that applies to general account contracts:

103 (a)(2)

(2) If some or all of the information necessary to enable the administrator to comply with the requirements of this subchapter is maintained by—

(A) an insurance carrier or other organization which provides some or all of the benefits under the plan, or holds assets of the plan in a separate account,

(B) a bank or similar institution which holds some or all of the assets of the plan in a common or collective trust or a separate trust, or custodial account, or

© a plan sponsor as defined in section 1002 (16)(B) of this title,

such carrier, organization, bank, institution, or plan sponsor shall transmit and certify the accuracy of such information to the administrator within 120 days after the end of the plan year (or such other date as may be prescribed under regulations of the Secretary).

2520.103-5

***

© Contents. The information required to be provided to the

administrator shall include--

(1) In the case of an insurance carrier or other organization which:

(i) Provides funds from its general asset account for the payment of benefits under a plan, upon request of the plan administrator, such information as is contained within the ordinary business records of the

insurance carrier or other organization and is needed by the plan administrator to comply with the requirements of section 104(a)(1) of the Act and Sec. 2520.104a-5 or Sec. 2520.104a-6

I'm wondering about the "upon request" wording in the reg. It has always been my understanding that the information must automatically be sent out regardless of whether requested by the administrator. This seems to be the DOL's position and the statute seems to bear it out. But the reg seems to say that it is required but only if a request for the information is made, i.e., no request insurer does not have to provide. So what is it, automatic or not. How does the "on request" wording in the reg square with the other guidance. The schedule instructions are ambiguous on this issue, i.e., just say "required"

I'm looking for some clarification on the distribution codes that are applicable on a distribution of excess contributions from a ROTH IRA. The instructions for the 1099R lead me to believe that code J is always used for this distribution with either 8 or P. Is this the case, or should code J not be used if the participant is 59 1/2?

Quoted from the instruction: "However, for the distribution of excess Roth IRA contributions, report the gross distribution in box 1 and only the earnings in box 2a. Enter Code J, and Code 8 or P in box 7. "

I've heard differing opinions, just wondered what anyone here thought.

Can someone point me to a good source to explain 403b plans... the ins and outs... differences between a 403b and a 401k?

Appreciate it!

Can I use VCP in this situation: a 401(k) plan was never properly adopted, but was operated for several years, then terminated. Distributions are now being made, and the adopting employer no longer exists. Can VCP be used to fix this situation? Thanks for any advice.

I just read something that stated that after tax contributions (not Roth contributions) are limited to 10% of total compensation. I always thought it was just limited to the 415 limit. Does anyone know anything about this?

We have an accounting client that has recently asked me to look at their options for retirement plans. They told me they had a Simple Ira in place. After reviewing, this is the list of problems they have:

1. There plan document is a SEP plan document.

2. They have been remitting employee deferrals "when they get around to it" - maybe once a quarter...randomly at best.

3. They have excluded a part time employee that should have been included for 3 or 4 years.

4. They have been withholding employee deferrals AFTER TAX - yes - I said after tax!!!!!

5. The match for 1 employee has been done consistently incorrectly.

I know this "plan" is screaming for the VCP - I just have never had to do that before. Can someone give me ideas on how to file - or if I can with a Simple Ira - and what they would be looking at for maximum penalties??? what is the basic process for going throught the VCP?

thanks for any help-

Beth

Company put a 401(k) plan into place on 1/1/05 - that is the effective date in the Plan document. In addition to an employer match , the Plan also provides company contributions to all eligible ee's (those with 1,000 hours of service) whether or not they make a deferral contribution. The company contributions are to be made each "payroll period" - a term that is not defined in the Plan document.

The company(which pays biweekly) did not start salary deferrals until the 2nd payroll paid in 2005 (1/20/05) and they did not make the employer contributions for the 1st payroll (1/6/05). I believe that decision was based on the fact that the wages being paid on 1/6 were for time worked in 2004.

It seemed to me that the discretionary contributions were due to the ee's for the first payroll paid in the plan year and we raised that point with the TPA. They suggested we consult our ERISA attorney. The response I am getting (filtered thru the HR Director) is that we owe the ee's the matching contribution on the deferrals they should have been allowed to make for that first payroll (plus earnings) But no opinion is being given on the employer contributions.

Your thoughts ?

Thanks in advance