Does anyone want to take a stab at whether or not a Med Time Planner or pill storage box is an FSA eligible expense? The box contains a compartment for each day of the week in which the patient is to place medicine / pill(s) for each day. Personally, I use my pants pockets to keep track, but thats just me.....

Does anyone know if the IRS is planning to release a model 402(f) notice updated for Roth(k) deferrals? I was just starting to draft one, and it's rather a bore. Would be a lot easier to wait if they are going to be doing one!

the initial and only plan document was never executed. what is the proper correction method. one of the trustees is now deceased.

A group health plan has 70 employees covered on the plan, but 130 covered units.

All information says that a 5500 needs to be filed if there are 100 "participants" or more on the plan.

The DOL (via a phone call) indicates that a "participant" is an employee. The insurance carrier indicates that a participant is a covered member, which makes sense from the insurers standpoint.

Does this group health plan need to file the 5500? Is a plan participant the employee only?

Thanks very much!

One man money purchase plan pays an in service distribution to a sixty year old participant in 2005. Plan does not allow for in service distributions. The amount paid was $600,000. No withholding no spousal consent. What should we do? I know that we can obtain spousal retroactively but what about the plan provision and the withholding?

Any help appreciated

What books/publications are out there that are recommended for a broad discussion of ESOPs? I'm thinking of ordering The ESOP Handbook by Steven Etkind. Thanks.

A taxpayer has established a SEP plan for his Schedule C income (with no other employees) and has a profit from that enterprise. He also has a farming enterprise with a loss for the same year (also no employees).

Am I correct in thinking that he can use the income from Schedule C to calculate his SEP contribution without combining it with the loss from Schedule F ?

Help, having trouble putting up a post, if this is not right place sorry. Does anyone know if ersia counts layoff time as vesting if you are a plan participant. I know leave of Absence does not but don't know about layoff. Thanks for any help

Is it allowed to have shares of PFIC (passive foreign investment companies) in an IRA account? Some PFIC are traded on the U.S. exchanges and could be easily bought through an IRA account.

Would income still be tax-free / tax-deferred?

Are the respective reporting forms (form 8621) required in this case?

Is it allowed to have shares of PFIC (passive foreign investment companies) in a 401(k) account? Some PFIC are traded on the U.S. exchanges and could be easily bought through a 401(k) account.

Are the respective reporting forms (form 8621) required in this case?

I have Fidelity Self-Employed 401(k) account. I am the owner and sole employee of the S-corporation. My W-2 salary has some components that show only up in box 1 but not in box 3 (e.g. health insurance premiums, HSA health savings account contributions), and some components that only show up in box 3 but not in box 1 (employee elective deferrals).

I can contribute 25% of my annual "compensation".

I know that the elective deferrals count towards "compensation".

Question: Do the health insurance and HSA contributions, that are taxable but excluded from social security tax, count toward "compensation"?

Attached are excerpts from publication 560 and the Plan document, but I can't figure out under which category the health insurance and HSA contributions fall, whether they are fringe benefits, deferred compensation, ..., if "taxable" means income-taxable and/or social security taxable, etc.

Compensation for plan allocations is the pay a participant received from you for personal services for a year. You can generally define compensation as including all the following payments.

1. Wages and salaries.

2. Fees for professional services.

3. Other amounts received (cash or noncash) for personal services actually rendered by an employee, including, but not limited to, the following items.

1. Commissions and tips.

2. Fringe benefits.

3. Bonuses.

However, an employer can choose to exclude elective deferrals under the above plans from the definition of compensation. The limit on elective deferrals is discussed in chapter 2 under Salary Reduction Simplified Employee Pension (SARSEP) and in chapter 4.

Other options. In figuring the compensation of a participant, you can treat any of the following amounts as the employee's compensation.

* The employee's wages as defined for income tax withholding purposes.

* The employee's wages you report in box 1 of Form W-2, Wage and Tax Statement.

* The employee's social security wages (including elective deferrals).

Compensation generally cannot include either of the following items.

* Reimbursements or other expense allowances (unless paid under a nonaccountable plan).

* Deferred compensation (either amounts going in or amounts coming out) other than certain elective deferrals unless you choose not to include those elective deferrals in compensation.

Fidelity Basic Plan Document:

"For an Employee who is not a Self-Employed Individual, “Compensation”

means, subject to the limits of this Section 2.9, wages, tips and other

compensation paid by the Employer and reportable on Internal Revenue

Service Form W-2, excluding deferred compensation, but (for Plan Years

beginning after December 31, 1997) increased by amounts withheld

under a salary reduction agreement in connection with a cash or deferred

plan under Code section 401(k), a SIMPLE retirement account under

Code section 408(p), a simplified employee pension under Code section

408(k), or a tax-deferred annuity under Code section 403(b), and any

amount which is contributed by the Employer at the election of the

Participant and which is not includable in the gross income of the

Participant by reason of Code section 125 (cafeteria plans), Code section 132(f)(4) (qualified transportation fringe benefit programs) (for Plan Years beginning on or after January 1, 2001), or Code section 457 (deferred compensation plans of tax exempt organizations)."

My question surrounds the eligibility definition of a Dependent FullTime Student. If a Health and Dental Plan

allow the definition to be age 19 unless FT student under AGE 26, but HCSA follows IRS dependent definition of FT student thru Age 23, then HCSA claims filed for expenses on FT dep child covered under health plan that is 25 years old would HCSA reimbursement really be allowed based on IRS definition of dependent?

Vickie

I feel as though I am starting so late but I know that now will still be better than later but I was just wondering on anyones opinion of TD Waterhouse.

I am 38 years old and have run the numbers over and over again on the Roth and traditional IRA calculators(on different sites Legg Mason, TD Waterhouse, my credit union site, ect.)

It seems that if I contribute the full amount to a Roth IRA for 30 years and start taking distributions at the age of 68 I will have aquired roughly 1.5 million (at 9%) and will be able to live off of an annual 50k to 70k (annual interest only )after switching to a conservative 7%.

Can anyone help me with these figures , I have never invested before but have always had it on my mind and feeling that I must do this now.

I have an appointment with a TD Waterhouse financial planner next week so I can start with 2005.

My two questions are: is this very realistic and what is your opinion of TD Waterhouse (I know they are suppose to be a discount brokerage) just want to feel ok with working with them.

I will also be contributing at least the same amount as the Roth IRA to a seperate fund outside of an IRA so I can have other income opportunities that I can always work with (I know I have to be diligent for the next 30 years and I will)

Thanks

1. IRA owner Ed takes a withdrawal from IRA.

2. Ed loans the money to Tom with a promise from Tom to repay the loan within 60 days, so that Ed can replace the money in an IRA.

3. Tom uses the money for a real estate development.

4. The entire development and all of Tom's worldly goods are destroyed by Katrina and Tom can't repay the loan.

Does Ed get any relief from any of the Katrina related legislation? I don't think so. Anyone have any ideas?

Thanks.

Company A's 401(k) permits the employees of Company A's affiliates to participate in the plan. Company B (an affiliate of A) was formed in 2004 and it adopted a 401(k) plan of its own with a more generous match than Company A's plan. However, employees of Company B were never offered participation in Company A's plan (by mistake of course). Does this have to be corrected?

The reason why I ask is because the benefit that the Company B employees received was better (matching contribution) than the benefit they would have received under Company A's plan. There is just no way that deferring under Company A's plan would be better. If there was no harm, can't we just amend Company A's plan to exclude Company B employees prospectively? Would it make a difference if Company A's plan permitted hardships or had more distribution options than B's?

I will earn about 4K from a part time job. At this job, I am a participant in a SIMPLE plan. I want to contribute all of my income from this job to the SIMPLE and then contribute 4K to a Roth IRA using other money.

Is this possible? Would contributing all of my income from this part time job to the SIMPLE result in me having no earned income and not being eligable for a Roth IRA contribution?

Thanks.

Any updated word on Roth 401(k) model amendments?

I assume a Plan will be able to treat regular before-tax deferrals and Roth 401(k) contributions differently for some provisions, e.g. in-service distributions, loans. Allow them from one source and not the other. Anyone operating that way pending amendment clarification?

A colleague of mine thinks he can set up a safe-harbor 401k plan with a 3% QNEC and a year end "cash or deferred" PS contribution. I tried to explain to him that if only a few participants defer their contribution into the plan and all the rest take it as cash, the plan won't pass the ADP test. He says it is a safe-harbor plan and not subject to the ADP test. Am I wrong? He says you can have a CODA with a safe-harbor plan but I think he is twisting the facts. Please help!

When implementing a Disease Management program or Wellness Program, when is it necessary to include the information in the Plan Document for a self-funded plan? These are not required programs but do they follow under ERISA? Can employee communication of these programs be separate from the Plan Doc or SPD?

Financial institution did not get an RMD processed until 6 days after 12/31/05.

We are requesting a waiver of the penalty.

Should a 1099 be issued for 2005 or 2006?

Thanks