I thought Relius had the new deduction rules built into the DB system, but I can't find the report.

Where does it show that the unfunded current liability is deductible?

Does it require 100 lives? Is there a plan spec parameter that must be coded?

I have a client who has an IRA that owns some commercial real estate. The IRA is set up and managed well by a custodian who specialized in IRA real estate investments. The lease is coming due on the real estate and in not expected to be renewed. In addition, the value of the real estate is appriciating significantly causing concerns about RMDs down the road. The client would like to distribute the real estate and own it personally but doesn't want to pay tax on the entire amount now. Can he sell the real estate, form his IRA to himself, or do prohibited transaction rules prohibit it?

Thanks for any suggestions on how to get the building into his name personally.

Dean Huber

A DB plan’s death benefit is the greater of PVAB or the (insurance) Policy proceeds. The face amount of the insurance policy to fund the death benefit is 100 times the projected benefits.

The plan has been purchasing Whole Life policies. The sponsor now wants to:

1. Prospectively stop buying additional insurance for existing participants resulting from increases in their projected benefits and for future new participants.

2. Somehow reduce the premiums burden on the existing policies of all participants so more money can be invested in non-life insurance investments.

As to 2, is there an anti-cut (or any other) problem if the policies are converted to Term assurance? I don’t see anywhere in the plan document where it is says that the policies have to be Whole Life – it just says life insurance policies.

Two more fun questions:

1. If you combine a 403(b) plan with a 401(k) plan for the ratio percentage test, do you have to combine the plans for 401(a)(4)? The 403(b) plan is an ERISA plan with both match and discretionary.

2. When doing the ratio percentage test for a 401(k) plan you can exclude the employees in a not for profit entity if they are eligible to make deferrals to a 403(b) plan. What if the 403(b) plan has an exclusion for employees that normally work less than 20 hours per week. Should these employees not be excluded when doing the ratio percentage test for the 401(k) plan?

Thanks

I was wondering how others have handled the following situations with the idea of preserving 404© compliance:

(1) elimination of a fund (give participants x amount of time to get out and if they don't, ...); and

(2) imposition of a cap on how much participants can invest in a fund.

Some fun questions....

There is a parent company that owns two not for profit entities and two for profit entities.

The parent company sponsors a 403(b) plan for the two not for profit enties and one 401(k) plan for the for profit entities. Both plans have deferrals, match and discretionary.

The parent company is a not for profit entity. The employees in the parent company are particpating in both the 403(b) and the 401(k). Don't ask me why or what benefit they think they are getting from it, I don't know.

Since the parent company employees are participating in both plans, I don't think the 401(k) plan can any longer exclude the employees in any of the not for profit entities from the ratio percentage test. Would you agree or do you think they can still exclude the employees in the two not for profit entities, just not the employees in the parent company?

I'll put my other questions in a separate post as not to overwhelm.

Thanks

Can someone give me a definition of "Casual Employee"? I looked it up in Tripodi's ERISA Outline book, but can't find one.

Thanks!

i know an ESOP must report on the 5500 the income distribution it receives as an S-Shareholder. where/how is this reported on the 5500?

Our client has a Top Heavy 401(k) Profit Sharing Plan with a new comparability profit sharing formula. Onc employee out of the 7 HCE/Key employees has a life insurance policy in the Plan. This client traditionally makes large employer contributions to the Plan.

However, due to cutbacks in reimbursement for services (doctor group) by health insurance companies, they are in a crunch for cash. The plan sponsor has already paid the life insurance premium for the policy, which is about 4.57% of the HCE/Key ee's projected annual compensation. The sponsor has also funded about $25K (they advance fund during the year).

My first thought is that the client is on the hook for at the very least 3% for non keys and 4.57% for the remaining keys in the other HCE/Keys's group.

Is there any other way out of funding more than $25,000 based on the fact that the plan sponsor paid the life insurance premium ?

Thanks for any thoughts on this problems.

Plan is a multiemployer plan in the lumber industry with very low level of active participants. Plan still has union employees, but is not collectively bargained. Does it cease to be a multiemployer plan? Has it experienced an ERISA 4041A(a)(2) termination?

I've just taken over a 401(k) plan and I found that no schedule p has ever been filed for it... It was my understanding that all plans need to file a Schedule P signed by the trustee. Now I deal with mostly db plans, so maybe this is common for 401(k)'s. btw... the company is a normal s corp

Hello,

Can I collect NYS Workers' Compensation & Social Security Disability at the same time?

I am an RN who was injured in 2002 on a previous job.

I currently have an opened Workers' Compensation case. Though I have submitted and been approved for reimbursement of multiple medical bills, I have not yet lost any time from work related to these injuries.

In April 2005, I became medically sick and have not yet returned to work. My medical condition, alone &/or in combination with my WC injuries, will require that I apply for Social Security Disability.

Many thanks in advance for your replies.............BLB

what is the compensation for members of an LLC taxed as a partnership? the members were given "W-2" compensation (incorrect, but that is what happened)and had losses on their K-1s for their share of the company's loss. does it make a difference if they are investor only or managing members?

I have a client who wishes to encourage those dependents who are eligible for coverage through their employer to take that coverage. In order to succeed in getting dependents to take coverage through their employer, there will likely need to be some financial incentive offered. Does anyone have any experience in doing this? What has worked? Are there any problems or pitfalls to avoid when doing this?

If NY co reincorporates but does not change its name, does it have to terminate its benefit plans and establish new plans under new entity?

I recently read that the conversion rules changed for 2005. According to the article, individuals are no longer required to include RMDs when determining Modified Adjusted Gross Income.

Where would I find the official IRS guidance on this?

I see a post from 1999 regarding using social security retirement age as the normal retirement age when doing cross testing.

Do current software packages that do cross testing, either for an average benefit test or a general test, provide the option of using the normal retirement age as defined in the plan or social security retirement age? Whichever provides the best results?

Thanks

Just got the case of a client who worked for a company with a defined benefit plan. He separated from the employer in 1998 and received a lump sum distribution in 1999 of his account balance (rolled over to IRA). His next employer was later taken over by the same company and he then participated in the same plan from roughly 2000-2003 and then retired. Another lump sum distribution was made of his account balance in 2004 (also rolled-over). The plan reps contacted him by letter in July, 2005 and claimed the second represented an erroneous distribution and demaned a return of the entire balance---providing no detail of accrued benefits. The plan reps waited only 9 days before filing a Federal suit to seek return of the entire second distribution and a restraining order against alienation of the funds. My client doesn't have good personal records to figure this out (there may well be some overlap in the second distribution, but how much??) and is now faced with the expense of defending a federal lawsuit and a hearing on the restraining order in one week.

Questions (1) anyone with any similar experinces and suggetions: (2) was the plan required to attempt some alternate dispute resolution before filing a federal suit?; (3) what is the most efficient way of resolving this matter?

Any thoughts are appreciated.

i know the ESOP must report on the 5500 the income distribution it receives as an S-Shareholder. where/how is this reported on the 5500?

what exactly is an 11-k? Is a plan required to file if it offers company stock as an investment option?