Is there any "guideline" per se regarding the fees that a consultant receives when placing welfare coverages with a TPA, stop loss carrier, etc.? My current employer - I wasn't employed when the contract was negotiated, is paying the consultant 15% of the stop loss - specific and aggregate premiums - as their "fee." Is there a norm and, if so, what it should be? I think $50,000 is a little much for a plan with 200 employees. Am I wrong?

Thanks for any help.

Dolores

Client has 401k Plan with 3% Safe Harbor and does max PS every year.

Client is unhappy with the cost of administration because independent audit is expensive.

Is there any way to get around audit reqs, such as breaking plan into 2 or 3 separate plans with same exact benefit structure in each plan?

One of my sales people would like to set a plan up that when a distribution is paid the distribution fee will come form the forfeiture account. I am aware the the ruling has come out that it is ok to take a distribution fee from a pariticipant account. Is it still ok to label a distribution fee as a General Administrative fee and take it from the plan then the participant who is actually the cause of the fee being incurred would not pay it but all other plan participant's would?

What will be Tax Year if we are filling a return for a short plan year say if it is first plan year beginning on May 1st, 2004 and ending on Dec 31st, 2004.

What Tax Year we will report in Plan Info Worksheet??

Thanx in Advance...

Amit

I might possibly qualify for a Medicare Savings Program through my state (CT) which could save me about $2K for the year. There is an income limit but no assets limit. The problem is that in addition to my SSDI income, I also have to claim my interest (on a CD) and dividends (from mutual funds) earned as part of my income and this puts me just over the allowed income limit. My specific question; Is there somewhere I can put my money (for the next calendar year) where it will grow, but not yield interest and dividends annually? I realize that growth stocks fit the bill, but I’m conservative and inexperienced in investing. I currently only have about 5% of my savings in Apple stock. I don’t know if it’s wise to put more money into just individual growth stocks. Do I have any other choices, given this specific situation?

p.s. I am 38 yrs. old

If employer maintains a VEBA to fund its insured retiree health plan, which includes a drug plan, is the retiree drug subsidy payable to the employer or to the VEBA?

Is there an inurement issue if the subsidy is paid to the employer?

I'm working on Form 5500 for a new client. The previous accountant had made a mess of things, and the Beginning of Year balances on Schedule H are wrong...by some very material amounts.

I know that I can't change the opening balances, and that my options are to:

1. Amend last year's return (don't want to do that), or

2. Make an adjustment to net assets on this year's return (sounds good).

But, where do you plug the adjustment on this year's Schedule H? Good ol' Form 990 provides a very convenient Line 20 for making adjustments to net assets. There's no similar line on Schedule H. How do you plug the difference?

Believe it or not, I've never encountered this situation until now.

How does everyone handle benefits when an employee goes out on military leave? We extend COBRA for medical/dental/EAP/physical after 30 days, but what about other benefits like LTD, Life, AD&D? Do you carry for the term extended to other Leaves? (we carry for 12 months) And then if you term these benefits do you still leave ee active but on military leave? What's the limit for leaving on military leave - 5 years?

Is there any exception from 20% withholding on distibutions on account of disability ? Presumably most disability distributions are still eligible for rollover treatment (except the rare very severe ones that may be excluded from income altogether) so I'm inclined to think they are subject to the 20%, but would appreaciate any opinions/thoughts. THx.

Advisor wants to put in whole life policies for owners and term policies for staff. No doubt this flies in the spirit of the (a)(4)-4 regs on discrimination within benefits, rights, and featurs. However, is there something "explicit" that states the polcies have to be of the same type ? Did the guidance on insurance that the service issued a year or so ago (mostly directed at 412i policies) address this issue ? Just looking for something specific if it exists to show the advisor.

How would a Company decide how much to charge for COBRA on a medical expense reimbursement plan? Can they simply charge 102% of the maximum amount available under the plan? The plan is fully funded by the employer from their general assets.

edited

Wife's out of town on business and kids are at school, so I guess you're the only ones to crow to. 20th anniversary today and my mother turned 80!

Snide comments always accepted!

Has anyone ever had this problem? You enter a new plan into Relius (a takeover) and enter beginning account balances. When you try to post the gain for that year, you get an error message that it cannot post because there's a zero basis. The census account screen shows beginning dollars and units, but there's no beginning cost basis. Is this related?

This is a PS with 1 employer account and 2 rollover accounts, all cash.

I'm trying to find the answer to a trivia question. So far, I've come up short.

There have been 3 players born in Maryland who hit 40 home runs in a season. Who are they?

I've come up with:

1. Babe Ruth (well, duh)

2. Jimmy Foxx

3. ??? I don't know

The answer isn't Al Kaline, Harold Baines, or Cal Ripken. Despite their brilliant careers, none of them ever hit 40 in one year.

A sole proprietor is the only participant in a qualified plan. The individual dies, so there's no longer a plan sponsor or administrator. Who can sign the Form 5500-EZ?

NOTE: This isn't an orphan plan; there's a successor trustee. But, the trustee doesn't sign and file Form 5500/Form 5500-EZ.

The statute defining adjusted gross income for purposes of the Roth conversion privilege provides that AGI is calculated excluding required minimum distributions pursuant to IRC Section 401(a)(9). The final regulations, however, provide for the following:

1.408A-3, Q-6. Is a required minimum distribution from an IRA for a year included in income for purposes of determining modified AGI?

A-6. (a) Yes. For taxable years beginning before January 1, 2005, any required minimum distribution from an IRA under section 408(a)(6) and (b)(3) (which generally incorporate the provisions of section 401(a)(9)) is included in income for purposes of determining modified AGI.

(b) For taxable years beginning after December 31, 2004, and solely for purposes of the $100,000 limitation applicable to conversions, modified AGI does not include any required minimum distributions from an IRA under section 408(a)(6) and (b)(3).

This language does not say that RMDs of 401(a) plans may not be excluded. It is simply silent. Both the BNA portfolio series and CCH state that any RMD is excluded. But, I have seen many commentators who say that only IRA RMD's may be excluded.

So - what does this community think?

Thanks for any insight.

new client wants to utilized VCP to correct failure of updating plan for GUST/EGTRRA/401(A)9 etc. 2 participant psp. since i have never had to file a VCP and am not an enrolled agent, i am not eligible to include Power of Attorney. it would be a waste of my time, money, etc to become an enrolled agent unless i was doing VCP filings frequently. what options do i have other than to prepare the application and have the plan sponsor sign off on it? any unenrolled agents have experience with this?

Small 401(k)/Safe Harbor Plan. The company had extentions on their taxes for 2004. They just submitted their 2004 SH contribution and the 2 HCE (both owners) figured their final 2004 income and sent in 2004 employee deferrals for themselves. Is this considered a late payment? Do they have to mark yes on the 5500 and pay in excise tax etc?? Any suggestions? Thanks!

We have an employee who is on the Company's medical plan. Her husband works for another employer and will be going on long-term disability effective Oct. 1. Can her husband enroll in our Company's plan or is this not considered a qualifying event? I’m assuming his coverage will terminate since he will be going on LTD.

Thanks for any insight.