An individual is a 50% partner in a partnership that sponsors a SEP. This individual also has unrelated self employment income from a business in which he is the sole employee and 100% owner. He would like to open a SEP for that side business. What are the concerns for that new SEP (i.e. are the combined contributions limited to the 415 limit)?

New company started 4/1/05 by two shareholders each over 5% owner. New employee hired 9/1/05.

New Plan says all employees hired as of 4/1/05 eligible with no service requirement but all other employees require 1 year with over 1000 hours. Does this pass 410?

Can someone please let me know how I find my site ranking on google? Much appreciated.

Our plan allows for hardships for the purchase of a primary residence. Two employees (who are married to each other) have submitted hardship distribution requests from each of their accounts.

Earlier this month and prior to the settlement on their new house, they maxed out their loan options in each of their accounts. They have presented the Settlement Statement from December 9th as documentation to support the purchase of their primary residence. The transaction was finalized on that date and it appears that all funds were distributed at that time.

I do not consider this to be a true immediate and heavy financial need at this point. The settlement is not contingent upon the cash from the hardsip distribution - for all intents and purposes - it's a "done deal".

Am I right?

It doesn't help much to see on the front of the faxed request "We would like to request this due to a recent purchase of our first primary residence. We would like to have new appliances, and curtains and such."

I must provide guidance to our Plan Administrator and I'm relatively new to the 401(k) area of benefits. Any thoughts would be greatly appreciated.

The preamble to the 409A proposed regs say that a split dollar arrangment is not subject to 409A if it provides "only death benefits." What if the arrangment also provides for the payment of the underlying policy's cash value upon termination of the agreement and/or cancellation of the policy? Does this blow the exception?

An employer maintains a single employer collectively bargained defined benefit pension plan. A Pension Committee is the named fiduciary and plan administer of the plan. Under the plan document, the employer appoints members to the Pension Committee. The union has requested that it be allowed to appoint 1-2 union members of the Pension Committee (which would be a minority of the total members of the Pension Committee). Would this violate the Taft-Hartley Act because the employer does not have exclusive control over the plan or can the union appoint some members provided that the employer still dominates and controls the vote of the Pension Commtitee? The 2nd Circuit's 1968 case, Independent Association of Mutuel Employees of New York State v. New York Racing Association, Inc., 398 F.2d 587 has been crticized by other Circuits. Any help would be greatly appreciated. Thanks.

A calendar year plan is attempting to terminate in 2005. They have already distributed assets but apparently there will be dividends which post and will not be able to be taken out of the trust prior to 12/31/05. Can the 2005 Form 5500 be their last one or will they have to submit a form for 2006?

A Plan matches the first 4% of deferrals at 25%. The next 2% (up to 6% deferrals) are matched at 100%. Does this Plan need to be tested for Benefits Rights and Features? After all, everyone can defer up to 6% if they want do.

Can the BRF test be done on a disaggregated (otherwise excludible) basis?

How is the test corrected if it fails? Do additional match contributions

need to me made to NHCEs?

Thanks!

FTWilliam advertised on Benefitslink plan documents at very reasonable prices. Has anyone used this service and if so, any comments on the checklist, plan document, etc.?

I have read conflicting information regarding the eligibility of over-the-counter meds reimbursed through a HSA. Are they eligible?

When calculating a minimum distribution for a participant that has an outstanding loan balance under the plan, do you use the entire account balance including the outstanding loan balance?

Thanks.

Okay, sorry for what may seem like a stupid question, but I have to ask it b/c I dont think it works, but my boss for some reason thinks it does, here it goes.

401(K) Profit Sharing Plan with Prior Pension Plan Assets merged in.

All participants are still employeed with balances, can you draft something in the document that states all money will be rolled out of the plan into individual IRA's except the 401(k) money? I have never heard of such an idea before, considering everyone is consider "active". Any ideas!

If a partner of an LLC died during 2005, and his compensation will not be determined until 2006, can a 2005 deferral contribution be made at that time.

Thanks!

To the general administrator of the message boards,

I think it would be helpful to have a separate forum for 409A. This huge topic is generating numerous discussions (and will certainly continue to do so), but the discussions are scattered among various places on the message boards.

If a SIMPLE IRA participant earns $10,000 in w-2 wages, could he defer the full $10,000 into the SIMPLE IRA and get a 3% contribution from the business. This would mean the participant would actually have $10,300 put in for a year in which he earned only $10,000. Is this possible?

Participant is hired 3/24/04 works 1000 hrs and terminates 9/20/04.

He gets rehired on 6/6/05 and works the entire 2005 plan year, obtaining another 1000 hrs.

Would he become eligible 7/1/05 since he worked 1000 hr the first year and got rehired in 2005?

We have a plan for a large company that owns several hotels and restaurants. They would like to implement a negative enrollment program but would like to exclude from the negative enrollment those employees whose compensation is primarily made up of tips. They feel it would be unfair to those employees because of the uncertainty of their income from week to week. They do not want to exclude these employees from the plan, they just don't want them to be subject to the negative enrollment.

Can they do this?

Plan has a normal retirement date of age 65. Lost participant terminated before age 65 is found at age 67. If the plan payments are retro to age 65, I understand that the regs require interest on the back payments. But does the spouse have to consent to a joint and survivor annuity retro to age 65 by seeing a comparison of the spousal benefit at age 65 vs age 67? Is the QJSA a greater benefit commencing at age 67 than age 65?

The assets the QDRO's are dividing are from my 401K and my retirement. My ex-lawyer, I fired him, did anything my ex-wife's lawyer wanted. He was supposed to write the QDRO for me and even collected the money for doing so but never wrote the QDRO. My ex-wife's lawyer wrote many QDRO's each full of errors that my lawyer passed on to me to sign and return. No chance! My lawyer ignored the fact that having her lawyer write the QDRO's was like allowing the wolf to guard the chicken coop. The ex-wife's lawyer expects me to sign the junk QDRO's that he has puked out, giving benefits that the ex-wife is not entitled to. That is not going to happen. I am aware that the court or the plan administrator will not accept a QDRO written by a layperson so I have to have a lawyer on my side. I have written the QDRO's as needed. Yes I know that they can be tricky, but from what I have seen I have a much better handle on it than either my ex-lawyer or the ex-wife's lawyer.

Can I have a lawyer review my QDRO’s, add his signature, add mine and submit this to the plan administrator, and if accepted as a QDRO, send it to the courts? Or in other words do I have to get my ex-wife and her lawyer to sign the QDROs?

IRS announced a new schedule of user fees that applies starting February 1, 2006.

http://www.irs.gov/pub/irs-tege/ir-2005-144.pdf

http://www.irs.gov/pub/irs-tege/ep_user_fee_appendix.pdf

Some of the increases are pretty dramatic.

For example,

Form 5310 (for plan terminations) increases from $225 to $1,000

all Private Letter Rulings will cost $9,000 (regardless of plan asset amount). Currently, it costs only $625 for plans with assets under $250,000.

What do you think of these increases?

Is there any way to get IRS to scale back these increases?

..... Jeff