Hello -

I'm 26 years old and married with 1 newborn. I am a teacher while my wife is a stay at home mom. We have very little to save for retirement but we still want to get started with something. My school district offers a 403b, but tied to a variable annuity or a loaded mutual fund with high fees. I've also looked into a Roth IRA but unsure of how much those usually cost to run. Is one better than the other?

Thanks!!!!!!!

Hello,

My brother and I run a small 501 c 3 and have 403b in place. 5 of 12 employees use the 403b by way of salary reduction. However, we would like to contribute company monies to the "participating" 5 employees(ERISA), no one else including ourselves. These contributions would be gauged on annual salaries, eg. 10% of the annual salaries.My brother and I would make up 65% since our salaries are higher. I read that top heavy does not apply to 403b's. I also read and was directed by Fidelity and other that there is NO problem here. I am just concerned with the imbalance of monies to the "key" employees. Help.

I have a Roth IRA, that was converted from a regular IRA in 1998. I want to withdraw some of the money that I originally placed in the Roth.... paid lump sum tax on the amount converted. I am 57 years old. Can I withdraw some of my original investment without paying a penalty or tax?

I am working on a determination application for a PSP and I have run into many hurdles along the way. Basically to make a long story short I am would like to see if anyone has a GUST restatement timeline or knows of where I can find something like that. I have read through all the Rev Proc's and GUST restatement briefings and I am not 100% positive I am understanding the timeline. Thanks.

I have a money purchase pension plan that requires distributions of entire account balances before age 70 1/2. The plan also contains the necessary language regarding required minimum distributions. A participant who was past the required beginning date recently applied for retirement and requested a rollover of his account balance to an IRA. (The participant's account balance was not distributed on the required beginning date because the plan had an incorrect birthdate for the participant). The participant was advised by the plan administrator that this was not an eligible rollover distribution because it was a required distribution under 401(a)(9) and plan rules. He was told he would have to take a distribution of his entire account and the money could not be rolled-over.

The issue from my point of view is as follows:

If the plan has the required minimum distribution language and a provision that calls for distribution of entire account balances before age 70 1/2 there seems to be a conflict. In my opinion, it would be reasonable to calculate the participant's rmd, pay that to him, and roll the remaining account balance directly to the IRA. I guess what I am saying is that if the RMD language is in the plan, shouldn't the participant be allowed to take advantage of these rules?

I would appreciate any comments.

i know he cant do it but i have to give them an explanation. the best i can come up with is that ERISA provides that participants must either be employees or former employees and that a trust cant be a participant because it is not an employee. only an actual person can be either an employee or a participant. does anyone have anything better??

Can a plan sponsor rely on a participant's written certification regarding the amount required to satsify a hardship or should the plan sponsor have written documentation to verify the amount?

In days gone by, we told plan sponsors that some kind of documentation of the hardship amount was necessary. A medical bill, eviction notice, etc. But I haven't been able to find anything definative that such documentation is necessary. Was that just a conservative approach to plan administration or is written proof required by a regulation, revenue ruling, etc somewhere?

What happens if an employer offers a Safe Harbor 401k and in the year decides that they cannot do the mandatory match? Also can you amend a Safe Harbor 401k to be a Traditional 401k mid year?

Hi,

Is it legal for a hospital offer a discount/reimbursement to employees on physician services rendered to said employees children? This would be in addition to a 50% reduction of the remaining balance of hosptial charges after insurance?

Thanks

can an employer beyond 70 1/2 continue to make SEP contributions?

Question for all of you that work with QDRO's more frequently than I do: I am an associate attorney, and at a previous firm, I did a fair amount of QDRO review for employer - basically I advised whether the submitted DRO's (sometimes in draft form, sometimes already signed by the court) were "qualified." On occasion, I also assisted a divorce attorney in drafting DROs (or reviewing them) for divorcing clients. It is my memory that, when working for the divorcing party, I always reviewed the Marital Settlement Agreement (MSA) or divorce decree, to ensure that the QDRO reflected the correct division of retirement assets. However, I don't recall regularly seeing (or requesting) the MSA when doing QDRO review for the Plan Administrator/Employer.

Now I'm at a new firm, and there is more QDRO work now coming my way from two Plan Administrator clients. My supervising attorney here says that it has always been his practice to request the MSA as part of the QDRO review for Plan Administrator clients.

My thinking is that the divorcing party's attorney has the responsibility to ensure that the DRO, as drafted, comports with the MSA, and that the Plan Administrator's review is more properly limited to the extent that the QDRO satisfies the requirements of 414(p) and comports with permissible payment terms under the relevant plan.

My boss, on the other hand, says that the Plan Administrator is responsible for administering the Plan, and that this INCLUDES being sure that the QDRO, as drafted, comports with the MSA.

Seems to me that it may be tricky to always request an MSA copy, especially in the case of proposed versions of QDROs.

Any thoughts out there? Is his preference to ALWAYS see a copy of the MSA quite usual and reasonable? It seems to me to go a little too far, but I'm willing to be corrected.

We have an HCE who terminated & rolled his 401k account to IRA that is due a refund due to our test failing

What needs to be done to get this out of IRA

How is the taxation handled in IRA

are there any excise taxes for IRA?

thanks

We are a small TPA and are exploring adding either a debit card or value added card to our FSA accounts. Does anyone have any reccomendations on a quality vendor for either type of card?

when determining ownership percentages, is the % of total shares used or the % of vested shares?

OK, so we know about the substantial and recurring deposit rule in 3 out of last 5 for a PSP&T, but we now have a Plan that was submitted for terminaton in 2005 that the reviewer wants us to go back basically to the last year a substantial contribution was made and vest prior terminees who received distributions in the subsequent year.

IE: 2 terminated ee's in 1999 (last year of PS contributon), received distributions in 2000.

Company had a MP/PS combo that was merged in 2000. Company fell on hard times and although intended to resume PS contributions when conditions improved, finally decided to terminate plan in 2005.

Agent wants those 2 partically vested terminees fully vested, in effect going back to a plan termination date of Jan 2000, citing the regs that the termination occurs "not later than" the last day of the following plan year.

I personally think this is a pretty hard line to take. In effect, if we fully apply this logic, we should never make a distribution in a Plan year where the Employer "might not" make a contribution, since we might have to go back and fully vest a paid out terminated employee. Of course, we won't know until the end of the year that the employer cannot make a contribution, so we have to wait for the following year, and have the same problem. Sounds like a catch 22 to me.

Presumably, this agent's supervisor agrees with him. I kind of think that using the 3 out of 5 rule would at least get us out 2 years to the end of 2001.

I have been wrong before, but this seems kind of Rube Goldberg to me.

Anth thoughts?

Suppose you have a company with a 1/31/06 year end but a plan year beginning 10/1/2005 and ending 9/30/2006. The plan is a db and would have a beg of year valuation. My understanding is the deduction can be for the plan year beginning in the fiscal year.

Question: could a 2006 deduction be had if the plan were adopted after 1/31/2006?

Does the loophole still exist where you can get around Roth IRA contribution limits by contributing nondeductible amounts to a traditional ira for previous tax year then immediately convert it into a Roth IRA?

e.g. 2005 MAGI is 98K meaning you are limited to contributing a maximum of $3200 to your 2005 Roth IRA. After Jan 1, 2006 and before April 15th, 2006 you make an $800 nondeductible Traditional IRA contribution, the next day you convert your new Traditional IRA to a ROTH IRA which is a tax-free conversion since there are no gains (your MAGI for 2006 will be less than 100K).

You just effectively contributed the full $4000 to your ROTH IRA. This trick works as long as you MAGI stays under $100K

Is there anything to prevent this from happening?

(This technique was published by Roy Lewis on the Motley Fool back in 2001)

Hi folks. Hopefully somebody here can point me in the right direction.

It is my understanding that in 2004 Congress passed legislation that granted funding relief for some pension plans, and that relief is set to expire. I'm looking for more details on this act, and unfortunately, haven't gotten too far using google. I am also interested in whether or not Congress is going to extend that funding relief. Any help or links are greatly appreciated.

TIA

The official IRS website indicates that the new user fees take effect in two phases ... one in February, 2006 and the second in July, 2006. It would appear from this site that the $125 VS user fee for 5307 applications is July 1, 2006.

However, a representative on the IRS Hotline indicates that the new fees are effective for filings made on or after 2/1/06. She indicated that while the IRS website was confusing, they are processing applications under the impression that the new user fees are in effect. The Appendix to the appropriate Rev. Proc. is not all that clear. On the fourth page of the Appendix, it indicates that some fees are effective on July 1st.

Most posters here believe that the new user fees applicable to determination letter applications are effective February 1.

Any thoughts? Thanks. Ed

IRA contributions are limited to the lesser of a set dollar amount and 100% of compensation. Assuming the 100% of compensation is the lower amount, can an individual invest 100% of compensation into the IRA and pay any sales charges by check (from passive income)?