I am working on a one-man sole proprietor DB plan with a calendar year plan year. He has already made the minimum contribution needed for 2004, but can make an additional deductible contribution for 2004 if he chooses to do so.

He has yet to give his tax info to his accountant, so his tax liability for 2004 has not yet been determined.

I understand that he is able to make additional contributions up to his deduction limit until his tax filing deadline of October 15. Our actuary has also stated that only contributions made by September 15 are reported on the 2004 Schedule B.

My question is: Do the assets on Schedule I include the additional contributions, which would then result in a discrepancy between Schedules B and I?

I tried searching but couldn't find anything.

Is it possible to have a 401(k) act like a DB plan? What type of plan provisions need to be in place to past the discrimination testing? just curious.....

Client is 66, still working (and plans to until age 70). She is not collecting any Social Security, having decided to wait for the higher payout at age 70. Between her SS benefit and her pension plan (which has a COLA), she expects to replace nearly her current annual income of about $60K. She will have only living expenses in retirement as her mortgage will be fully paid off.

She has been funding a regular IRA which now has a value of approx $60,000. She stopped funding that a few years ago, and started funding a Roth IRA instead. I am wondering whether it makes sense for her to convert the old IRA account to a Roth IRA, thereby avoiding RMDs starting at age 70-1/2, so that she can have the flexibility of accumulating her IRA funds in the event she lives for a very long time (she is concerned as longevity runs in her family). At my behest she spoke to the bank officer where she has her IRA account and he advised her not to convert based on the tax liability she would incur in converting to a Roth.

I also am wondering whether there are any differences to the account beneficiaries (her three children) if her account is held as a regular IRA vs. a Roth IRA.

I would be interested in getting any thoughts on either of these issues. Thanks.

If a cross tested profit sharing plan passes ratio % as a whole and each rate group passes ratio % test( using EBARs) does average benefits even come into play? Does the answer change if there is a 401(k) and/or match component?

Is long term care tax deductible (premiums) for the employer and the employee receiving the benefit or just one or the other?

Thanks

(just curious)

Alternate payee, wife, wants to omit social security number from the QDRO and disclose it via a separate document. Her concern is identity theft. Her statement is that the QDRO is a public document. (I'm not sure how the supporting disclosure of her SSN via the other document would not be public unless it's sealed????)

OK to do this and what would be the required procedure to make sure this requirement of the QDRO is met?

A large (and ever growing) controlled group has several Plans. Some have an Employer Match, some do not. All Plans pass coverage separately, except one which relies on the Average Benefits Test (there is also a DB Plan). All are tested separately for ADP/ACP.

One Plan wishes to be a safe harbor plan. Is there any problem with one plan in a controlled group becoming a safe harbor Plan? Is this addressed anywhere? I see the references in notice 98-52 to aggregation and disaggregation but it does not specifically address controlled group.

If an HCE transferred from the safe harbor plan to a plan in the group that does not have a match would the match have to be refunded to him? Would any problems of this nature be solved if HCEs were prohibited from receiving a match?

Thank you!

An employer with a 125 plan wants to increase decutibles, but only require employees to pay the old amount and therefore reimburse employees who exceed the old deductlbe amount up to the new amount. Is the payment from the employer to the employee for the difference in deductible taxable to the employee? I'm not much of a tax guy.

An employer with a 125 plan wants to increase decutibles, but only require employees to pay the old amount and therefore reimburse employees who exceed the old deductlbe amount up to the new amount. Is the payment from the employer to the employee for the difference in deductible taxable to the employee? I'm not much of a tax guy.

I am a "newbie" ... are there some sources I can go to which publish what health insurance trend has been for 2005? Our firm just got our 1/1 health insurance renewal. My carrier had trend of 12.5% and I'd just like to see how that compares to the industry average. I tried mercer.com and couldn't find anything, and on milliman.com they only have 2004 trend. Where can I look to see what insurance carriers are averaging for 2005? If anyone could give me some advice I'd sure appreciate it.

A start up will pay COBRA premiums for new employees until they have enough employees in California to quality for a group health plan since most of them are out of state currently. The maximum head count will be under 20 once the company is in place.

Since the premiums are paid by the new employer for the COBRA premiums for continuation coverage from a previous employer on behalf of their new employee, two questions:

1) Are these COBRA premiums deductible to the corporation as an expense if they provide this for all the new employees in lieu of a group health plan?

2) Are these premiums tax free to the employee or taxable income?

I know that most do treat them the same as group benefits and have had no tax issues but wondering if it is sanctioned by IRS or not. On one hand, they are the new companies employees and these are employee benefits. On the other hand, the benefits are not tied to the current employer but to the previous employer.

I would really appreciate your help on this because I looked through tax facts 2005 and other publications and could find no mention of this.

THANK YOU!

Can an employer, with two classes and waiting periods for benefit eligibility, offer a Cafeteria plan with two waiting periods?

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Hi,

Can anyone please tell me if small business owners are allowed to defer after the plan year has ended? That is, can they defer at the same time that they are making their profit sharing contributions.

Thanks.

Reg

We no longer wish to maintain our volume submitter specimen plan. Does anyone know what we have to do to discontinue it? Is there any guidance regarding what kind of notice must be provided to adopting employers, etc.? Thanks.

A DB plan has held a small amount of employer stock for several years. The stock has done fairly well and we were just told that it represents about 18% of the plan assets.

The employer can sell enough stock to bring the level in the plan down to below 10%, but was there a prohibited transaction (and applicable penalties due) for the period that the employer stock exceeded the 10% limit?

An employer asks if he only pays people via 1099 does he have to let them participate in a business retirement plan. Does anyone have an answer to this?

According to the DOL regulations Sec. 2520.104-20(b), the cancer plan doesn't appear to be excepted from the Form 5500 filing requirement, but I was under the impression that if a plan has less than 100 participants and is fully-insured, it didn't have to file a Form 5500. Am I missing something? Any thoughts would be greatly appreciated.

Our small (but growing) TPA firm is looking for a flexible loan amortization software (either an Excel macro or stand-alone). The one in Relius is OK, but lacks some printing options we would like. We wouldl ove to find something that allows us to change most of the variables. Can anyone point one out to us?

We have a client that sponsors two DB plans, one for hourly employees and the other for salaried employees. Both plans are underfunded on a termination basis (417 interest rates).

The client wants to merge the plans into one plan. In order to comply with 414(l) what do we need to do? What type of statement needs to be attached to the form 5310-A?