Client XYZ, Inc. will do business under an assumed name of ABC. Client wants to name plan doc. as well as reflect on all participant communications ABC Retirement Plan. The Form 5500 will include client's name as per the Articles of Incorporation. Any reason why client cannot use the assumed name as referenced above? Thanks.

[size=7]I am facing more tax debt than anticipated for 2005 and it was suggested I check into opening an IRA or a Roth IRA before April 17th. How would this help me as far as the amount of $$$ I owe the IRS and State?[/size]

With the temporary window afforded by the lapsing of PFEA, one of my clients is questioning whether it would be smart to amend his plan to provide for a fully subsidized Early Retirment Benefit at his current age of 54. His accrued benefit is equal to 100% of high 3-year average compensation but is significantly less than the IRC 415 dollar limit at age 54.

If we make this change, am I correct that his maximum lump sum would be based on the APR using 30-year treasury rates and 94GAR at age 54?

What can an employer do, if anything, if it knows that the maximum OASDI has been paid on behalf of an employee. For example, say Employee works for Company A from 1/1 to 6/30 and then is transferred to Company B, which is a subsidiary of Company A. Employee's is paid well, so Company A paid the maximum amount of OASDI during the first couple of months of the year. Company B knows how much Company A has paid in OASDI. Is Company B still required to pay OASDI on Employee's salary even though it knows that the full amount required to be paid for that individual has already been met? The same thing can occur if Employee works for Company A and Company B at the same time.

It seems odd that the employee can get the tax credit for his/her overpayment, but an employer cannot get a tax credit or take other action for its overpayment.

Is there a statutory maximum for claims submitted after the end of the plan year. The claim was incurred and paid for by the end of the year (and no 2 1/2 grace period). The plan says 180 days but the claim was denied. Thanks.

I'm sure someone knows the answer to this question. Is imputed income for a grandfathered split-dollar arrangement for a former employee reported on a W-2 or a 1099R? Thanks.

Are distributions from a medical benefits account established in a qualified retiremnt plan pursuant to IRC Sections 401(h) and 420 treated the same as distributions from other health plans, such as a flexible spending arrangement or a health savings account?

I have just had a discussion with an accountant. He is claiming a single life qualified 401(K) Plan can be set up in 2006 for 2005. It is a January 1 to December 31 plan year. I need to find a site where I can cut and paste to show him that it must be set up in the plan year it is for. Unless....

Thanks

We recently acquired a company in a stock (not cash) transaction. Our company has a 401(K) plan. The acquired company 401(k) plan was terminated prior to the deal. We received an FDL on the acquired company plan termination and began distributions. We can not locate 50 or so participants from the terminated plan even after sending certified letters, IRS locator service, etc. (everything required in FAB 2004-02).

Question: Can we distribute these "lost participant" balances to IRA's (as described by the Bulletin) even tho we have another on-going defined contribution plan to which these balances could be transferred ? None of the guidance seems to contemplate having two DC plans and one being terminated.

Thoughts ? Thanks.

when shifting adp percentages to pass an acp test.... doesn't the adp test have to pass prior to shifting to acp and also pass after shifting to acp?

i have a dilema with a provider......... adp and acp originally failed. provider took hce adp percentage that the test would need to be at to pass and shifted from that.

example: original adp test results: HCE ADP= 7.02%

NHCE ADP= 3.33%

HCE would have to be at 5.33% to pass test

original acp test results: HCE ACP= .21%

NHCE ACP= .08%

HCE would have to be at 0.16% to pass test

provider shifted adp to acp by utilizing the 5.33% number and shifting from that. can this be done?

thanks,

Kim

We are once again at our Renewal Date for Health Insurance.

We currently have two tiers of Employer Contribution, 80/20 for Managers, and 65/35 for staff level employees.

The question at hand is.... Can we "Grandfather" in employees that are currently on the 65/35 health plan, and change our contribution for the same staff level employee as new participants enroll in our program to something different like 50/50?

if an employee receives both a W2 and a 1099 from their employer, what definition of compensation (W2, 415 or 3401) would the plan need to use in order to use both numbers for profit sharing contribution purposes.

obviously i am aware of th risks, manipulation, etc,....but w/ time on my side, if i find some good ones fo the long haul, it'd be nice to KEEP all the profits! do some banks or b/d's have differet rules and resrictions, or can i do what i want, when i want with who i want? how about commissions? are some better than othrs? any recommendations are much appreciated. thanks in advance.

Help, please. This isn't strictly an ESOP question, but I wasn't sure where to post it.

My daughter's company granted her stock options. (I haven't seen the plan or SPD, so I don't know whether these are NSOs or ISOs). She was granted 800 shares at a grant price of 9.275 and 300 at a grant price of 9.80. She quit her job late December to attend school, beginning this semester. She had to exercise by 1/20, so she did so on 1/18.

Yesterday she received "confirmation" from Smith Barney. The 800 shares were exercised at 22.005 (so the gain was $10,184; the 300 shares were exercised at 22.000 (so the gain was $3,660.) Smith Barney is withholding $4,909.65 and $1841.22, respectively. That's overall about 49%. Can that be correct? We expected the gain would be taxed as income, and we also expected her income this year would be pretty low because she is now a full time student. Yes, if they overwithheld she'll get it back, but she could really use the money now for school expenses.

Thanks for your help.

Please forgive what I suspect is a dumb question, but my company, owned by a public company, was sold to a private investment group. This instigated a new 401(k) plan. 40% of my original plan was the public company's stock. Just after the sale, the employees were given documents to rollover the old 401(k) into the new plan.

Being the procrastinator I am, I missed the 90 day deadline to turn in the paperwork. Panicked, I asked them what this meant. It was explained that I only had a deadline after the paperwork was filled out and notarized (I'm on a joint plan with spouse). All I had to do was file new paperwork for a new 90 day deadline. Well during this time, it so happened, the original company's stock went vertical and that plan increased in value significantly....in the meantime, my new plan didn't do much of anything...so now I'm thinking its better for me to leave the old plan as is. Of course I realize the opposite could happen, but knowing the company well, I'm confident that won't happen.

My question is, can I do this? Can I hold two company 401(k) plans at the same time? I have NO idea if I'm under same time limit or even if there are legal issues. I realize I'm not contributing to the old plans, but nonetheless, it is performing better. Thanks for any information

I realize that an employee of an LLC that also is a member of the LLC cannot participate in a cafeteria plan sponsored by the LLC. Do any attribution or constructive ownership rules apply when an employee is not a direct member of the LLC, but is an "indirect" member? For example, assume that a corporation owns 100% of the LLC and an employee of the LLC owns 1% of the corporation. In this example, is the employee deemed to be a 1% member of the LLC for purposes of eligibility to participate in the cafeteria plan? I think the answer to this is no, but I want to make sure that I am not missing anything. Any help would be greatly appreciated. Thanks in advance for any responses.

XYZ 401k plan transfers from Investment company A to company B. A advises client that the GIC surrender charge is $5,000. B agrees to make up that loss to the affected participants. A liquidates, and wires to B, less the $4,500 charge (read on).

B prices the contract according to the $5,000 charge. Later we find out that A mis-quoted the charge. The charge really only was $4,500. And in fact when the plan's funds were transferred from A to B, A really only did charge $4,500. However B did not find out about this until after it had already deposited $5,000 into the contract as per agreeement.

$500 is now sitting in the forfeiture holding account and B is asking the TPA (me) what to do w/ it.

$500 just so happens to exactly = the GIC surrender imposed by A on a participant that terminated employment and withdrew from A several months prior to the transfer from A to B. It's pretty clear that A mis-stated the contract surrender (A did put in writing that the amount was $5,000).

Should B just pull $500 back out and take it back? They are not willing to re-configure the contract pricing although they state the impact to the pricing of this $500 is "minute."

Or - does this money have to stay in the contract. If yes, then should the money go back to the terminated participant that lost it in the first place? Or, should it be used as forfeitures? Or, should it be allocated to all eligible participants as "earnings?" Or something else?

Thanks for any help.

Discussions have been occurring regarding the proper computation of optional forms of benefit.

What is the proper method of computing the optional form of annuity in the following case:

Actuarial equivalent

Interest 6% (Pre and post)

Mortality 1994 GAR

Normal form Life annuity

Applicable interest rate 5%

Monthly benefit at 65 is 1,000

What is the monthly benefit under a 10 year certain ONLY optional form??

Thanks for any and all comments.

The final regulations permit matching on catchups "... if a plan applies a single matching formula to elective deferrals whether or not they are catchup contributions, the matching formula as applied to catch-up eligible participants is not treated as a separate benefit, right, or feature under §1.401(a)(4)-4 from the matching formula as applied to the other participants."

Fine, but I have a client that allows participants to make catchup contributions throughout the year, at a dollar amount per payroll period. The matching formula is 100% on first 6% deferred, including catchups. Up to 50% of comp can be deferred. Each paryoll period their system calculates a match on the regular deferral field and also matches a separate catchup field up to 6% of comp each, with an aggregate annual dollar limit for 2006 of $13,200. (6% of $220,000)

Assuming that everything orginally deferred as a catchup, turns out to be a catchup at the end of the year, then we end up with really disparate matching percentages. It appears that we have both a potentially discriminatory match and / or that we are failing to follow the plans matching formula. Perhaps we don't have a problem, (particularly if we raised the deferral limit to 75% of comp to pass the universal availablity safe harbor). Any thoughts? Can we, should we, have ADP combine the regular deferral and the catchup into one field and then calculate a match on that field?

EE A: $220,000 Comp, $20,000 deferral, $13,200 total match, 6% of eligible comp.

EE B: $150,000 Comp, $20,000 deferral, $9,000 match regular + $4,200 catchup match, 8.8% of comp.

EE C: $100,000 Comp, $20,000 deferral, $6,000 regular match + $5,000 catchup match, 11% of comp.

EE D: $ 50,000 Comp, $20,000 deferral, $3,000 regular match + $3,000 catchup match, 12% of comp.

EE E: $ 30,000 Comp, $15,000 deferral, $1,800 regular match + $1,800 catchup match, 6% of comp

If a holistic practitioner performs a thermogram is it necessary to request a letter of medical necessity from a primary physician? If no primary exists, is a letter from the same practitioner performing the test acceptable to document the medical condition he is treating? Would we be justified in requesting that the services be submitted to insurance first? What other forms of documentation should be requested to validate the expenses as eligible under a health care FSA?