We have an active employee who has been enrolled in Medicare Part A for 18 months. He will soon retire. His wife says that her insurance agent is telling her she gets COBRA from our self-insured plan for 36 months from the date of termination. We think she only gets 18 months. Could her insurance agent be right?

Does anyone know the current OA portion of the current OASDI rate?

Background: A plan uses the Unit Credit funding method. The plan is frozen so there is no normal cost. There are amortization charges and credits as well as an additional funding charge.

In determining the actuarial gain or loss for the year, we take the difference between the expected unfunded past service liability (not less than $0) and the actual unfunded past service liability (not less than $0).

For example, lets assume the expected unfunded past service liability is $0 and the actual unfunded past service liability is $0. As such, there is no actuarial gain or loss base for the year. In this scenario, the balancing equation does not balance.

How do you handle such a scenario? Do you simply create a "balancing base" to make your equation balance? If so, is it amortized over 5 years for minimum funding purposes?

Reading from the "Explanation of Provisions" in the Federal Register, Vol. 66, No. 126, 6/29/01, Section B, 3rd paragraph:

"The general rules and regulatory definitions applicable under section 410(b) apply also for the purposes of these regulations. For example, these regulations do not change the general rule prohibiting aggregation of a 401(k) plan or a 401(m) plan with a plan providing nonelective contributions. Accordingly, matching contributions are not taken into account for purposes of the gateway."

In other posts, it has been argued that ANY type of nonelective employer contribution, including QNECs, can count toward the gateway. How are QMACs treated for purposes of 410(b)? As a nonelective employer contribution, or as a matching contribution?

I'm afraid it's the latter, and therefore, QMACs cannot count toward meeting the gateway minimum. But I would love to be wrong. Was there anything on point in the final 401(k) regs? I haven't read them thoroughly yet.

On Wednesday of this week, at two minutes and three seconds after 1:00, the time and date will be:

01:02:03 04/05/06

Are there any federal statutes, regulations, or court cases making the payment of the above fees by a plan's broker/consultant illegal assuming they are fully disclosed (e.g., Schedule C in the context of a welfare benefit trust)?

Similarly, are there any state statutes, regulations, or court cases making the payment of the above fees by a plan's broker/consultant illegal assuming they are fully disclosed (e.g., Schedule A in the context of a fully insured arrangement)?

Please do not venture an opinion without the accompanying citations!

Thanks, Ira

I am 27 and single. My current income is $46,000. My current job does not have a 401(k) or pension program. I have been reading up on ROTH IRAs and I think I would like to start one, hopefully in time for the 2005 contribution deadline. I don't have any experience in investing. I have enough set aside right now to make the max contribution and I could probably continue making the maximum contribution each year. Any advice would be much appreciated.

The other question I have is regarding the cap on contributions. I've seen that you can only make contributions if you are single and earning $95,000 or if you are married and your joint income is $150,000. When you earn beyond that cap, can you still continue to invest the IRA? And will the earnings continue to be non-taxable? I'm not sure where I will be in the future and I have the potential to earn over the $95,000 in the next 5-10 years, so I am curious.

Can a plan that has made the top paid group election also carve out otherwise excludable ee's for testing purposes? Or is it one or the the other?

I am a regulatory compliance officer for a state retirement system, a defined benefit plan. Presently, my primary focus is to ensure compliance with the Internal Revenue Code and state statutes which contain the provisions of the plan.

Is anyone aware of any associations or groups of individuals who are employed in a similar function?

Any newsletters or continuing education opportunities geared to governmental plans?

Can a Roth IRA that was established in 1998 with new IRA funds (not converted funds but new tax year IRA funds) be converted to a Traditional IRA? In order to consolidate yearly IRA account management fees, I want to end my Roth account and move those funds to my Traditional account. The Roth balance is small ($1,000) so the account fees do not make it worth keeping it as a Roth since I have only been eligible to contribute to Traditional IRAs since. I see a lot of comments about "converting back" to a Traditional IRA (recharacterization) but these funds were never in a Traditional IRA. Is there a way for me to keep these funds as part of my IRA but as part of my Traditional account vs. a Roth account?

A small MP plan has several violations going back to the plan's 1999 inception, including no 5500 filings, document not updated for starters. The accountant determined the annual contribution for the plan, but did nothing else plan related. Our TPA firm was brought in to help clean up the mess, which apparantly has ruffled the accountant's feathers. We would like to see payroll records going back to 1999 to confirm that deposits were correct, as well as to get accurate partiicpant figures in order to complete the 5500s from 1999 - 2005. Accountant has told the owners "since you have hired a TPA, we are not going to retrieve this data".

Is the accountant obligated to provide this information? A reasonable fee would be in order of course. How would you proceed?

What kind of retirement plan is this? Can this be rolled into a 401k?

My employer will match only 25% of our contributions and only at the end of the year for contributions made to our 401K and may even announce a 50% match at the end of the year. The mutal funds availabe in our 401K plan are not really satisfactory to me, so I would prefer to invest my money in an account that has accesss to stocks, options, and bonds. I am searching for a way to get the employer matching but still move the money I've put aside out of the account. For example, Could I make contributions to the 401K plan and then withdraw them and pay the 10% penalty, before those contributions are ever matched? In this way I end up basically netting a 15-40% gain. In other words, will taking a loan out or withdrawing funds affect the employer matching(I realize I can't withdraw the employer matching till I am vested)? Then I could increase the contributions we make to my Wife's SEP to reduce our taxable income to compensate for not using the tax advantages of the 401K.

Any ideas? The funds really stink 4-8% returns, and I am getting about 30-60% by investing on my own, this makes a HUGE difference.

ADP test failed, refunds made by 3/15/06. Later discovered that an HCE was coded as an NHCE, so test fails worse. HCEs were not happy about getting refunds in the first place, now will have to get more. Before calling the client, my supervisor wants to know all options. One I am not sure of, can they re-deposit the refunds they got and do QNEC instead?

Any help is appreciated!

Are you interested in a C4 Study Group for up coming exam in May?

Does anyone know, or care to venture a guess, as to what the "phase-in" over 4-5 years might mean for replacing the 417(e) rate for lump sum purposes under the Senate & House Bills ? I keep seeing a snyopsis of the two currently passed bills (House, Senate) stating lump sum rates a yield-curve "phased-in" over 4 or 5 years and wonder if it's likely to similar to the Gatt rate phase-in where you had an option to adopt it within a window period of a few years, or likely to be a mathematical phase-in where the impact is slowly phased in (e.g., 20% the first year, 40% second year....) ? Any thoughts or guesses ? I have a client's considering a plan term and the plan's somewhat under funded so I'm wondering if there's likely to be any relief on the lump sum values in the next couple of years (of course if it only applies to new accruals it won't help much).

hello,

Wife and I are planning to open up a ROth account. SHe is ten yrs older than i am and will hit 59 and a half sooner. My question is if there are any limitations to us opening up the roth in her name and then contributing the maximum amt allowable. This way, we will have access to the distibutions when she hits 59 and a half.

thanks for any inputs

My wife and I made $4k 2006 Roth IRA contributions in Januay,2006. However, due to an unexpected income last month, our 2006 AGI will exceed $160k. What are our options?

Thanks in advance!

I have a question about whether to pay taxes on a Roth IRA conversion for 2005 or whether to wait until 2006.

I had money in a state Teacher Retirement System account (pre-tax). I took it out in late 2005, and put it into a Traditional IRA, which was then recharacterized into a Roth IRA. But, by the time it was recharacterized, it was already January 2006.

Can I pay taxes on this for 2005? I haven't gotten any sort of form from the company handling my IRA (they said they will send it out for 2006). I'd much rather pay it in 2005 than in 2006, since I'll be in a completely different income bracket next year.

Thanks,

Brendan

One of my plans has six divisions and all adopted the same plan document. I used to attach six Schedule T with 5500. Since there's no schedule T any more, shall I just check that one box on line 9 of schedule R? Thanks.