Hi there,

Can anyone please help me with this situation? This is the scenario: male employee A has a live-in girlfriend. They have a child together. The child is on employee A's health insurance and employee A also has a Dependent Care FSA for this new child. The girlfriend is not on the employee's health insurance. If the girlfriend loses/voluntarily leaves her job so that she can stay at home, would this be considered a qualifying event so that employee A can decrease his Dependent Care FSA?

I know that this would be a qualifying event if they were married, but how does the IRS view live-in girlfriend/boyfriends?

Any help would be greatly appreciated. Thank you!!!

The employer is in the process of changing to a new trustee for the company's 401(k) plan. Prior to this change, employees were investing all over the map. For the most part, they've been able to transfer things over without too much difficulty, but there's one investment that the new trustee says they won't take on.

There are significant penalties if the participant liquidates the investment now. I suppose we could set up a separate trust for that investment, but I'm wondering if the participant can be forced to sell.

I log into my company computer system from home using a remote desktop connection. I am able to log onto Relius Admin and Govt. Forms without any trouble but I have problems with Relius Documents. I was wondering if anyone else logs into Relius this way and would be willing to answer some questions.

The auditor of our health plan insists they need claims info. to complete the Form 5500. Accordingly, we asked them to sign a BAA, but they are only willing to sign a confidentiality agreement (which doesn't meet the requirements of a BAA). Has anyone run into this problem? I can't think of an exception to HIPAA for an auditor. Thank you in advance.

Can the state legislature take money that a university contributes for optional retirement plan participants to help fund those in the defined benefit plan? This is occurring because the defined benefit plan now has expected unfunded future liabilities. I thought that the fiduciary duty would be to all employees and this would be a violation of IRS code 401(a)(2), exclusive benefit rule and 401(a)(4), requirement that plan benefits not discriminate in favor of certain employees.

If so, would I take the case to the attorney general or could I start a class action suit as well?

One of the attorneys we (a TPA) do business with is telling his clients that they may take participant loans with an interest rate equal to the current "applicable federal interest rate" that is used by the IRS for imputing interest on an interest-free loan. This concerns me because that rate, for a five year loan, would be approximately 3.85% at present. That seems kinda low, doesn't it?

Is anyone having any doubts about implementing this grace period in light of some of the questions raised with respect to COBRA? We have put the brakes on implementing at this time after having read some of the concerns raised in the administration of COBRA (we handle it internally so are even more concerned about compliance).

If professors are given paid time off each year to go on monthly (or longer) sabbaticals, do they earn hours of service for allocation and vesting purposes? The school states that they are given sabbaticals to go research, meditate, etc. and feels that they should be given service while they're away. Any help would be greatly appreciated.

Am wrestling with how much to get involved with clients. Interpretation of CMS guidlines on CC Determination (Not Actuarial Attestment) seems to indicate this can be done by someone w/ claims/analysis background. Yet, carriers are charging up to several thousand to do this, which makes me wonder if I’m missing something

This 5500 season, our law firm has received auditors' request for information that include "non-standard requests" falling outside the scope of the ABA's Statement of Policy Regarding Lawyers' Responses to Auditors' Requests. In particular, we have received requests to "confirm all information brought to [the law firm's] attention indicating the occurence of a possible illegal act committed by the Company, the Plan, or any of their agents or employees." Our malpractice carrier has generally advised that we should not respond to such non-standard requests and tell the auditors that it would be inappropriate to respond under the terms of the treaty.

I am curious whether others have received similar requests and, if so, how are you responding.

I asked this on the terminted plan board, but it does not get much activity, thought i would try it here.

I have a company that terminated their k plan in January of 2005 when they got bought out by another company. The February deferrals started going to the new company's plan.

Do I test the terminated plan just for Jan. deferrals?

Something feels wrong about that...?

thanks all

A time-consuming task is the organizing and filing of monthly statements we receive for participants with brokerage accounts (Morgan Stanley, Merrill Lynch, etc.) Does anyone know of any brokerage firms which have a procedure whereby TPA's can automatically receive electronic copies of statements? If so, could you provide me with a contact person at the brokerage firm.

And if anyone has a suggestion for an efficient way to deal with brokerage statements, please let me know. Thanks.

Multiemployer PS Plan credited account of p for year in excess of 415© limits. RP 2003-44, App. A indicates that excess amount should be put in unallocated expense account to reduce ER contributions in future years and while suspense account remains, the ER is not permitted to make additional contributions to the plan.

Does this mean that the suspense account should be applied (allocated) to reduce contributions of all the ERs in the plan as to the entire universe of participants, just as to the participants on whose behalf this particular ER contributes on, or just as to the account of the participant whose account exceeded the 415© limit?

Employer is terminating a profit sharing plan that provides for joint and survivor annuities. TPA is suggesting elimination of this distribution option to help speed things along. However, termination date has already passed. Can employer amend the plan to eliminate the JSA post termination date? I am aware of PBGC Reg. Section 4041.8, which would prevent this amendment to a terminated DB plan. Is anyone aware of any comparable guidance for DC plans?

Thanks in advance,

Amy

An employer has a 401(k) plan that excludes union employees. The employer acquired another company which has some employees (who enjoy the benefits of salary deferrals) who will be forced to go union. They will be enrolled into a collectively-bargained plan which does not allow employee contributions.

The acquiring employer wants to appease them someway by looking for options for them to defer. My thoughts are to amend the plan to allow union employees to participate in the salary deferral component of the plan but not the employer portion. Are there any concerns that I should be aware of? My understanding is that the union employees are tested separately for coverage testing. If no union EEs are HCEs, there should be any testing issues.

Is there a point at which you can "give up" trying to retrieve overpaid pension benefits from an estate?

We have four pension plans in a Master Trust. 3 participants from two of the plans died in 2004, but we were not notified until after an additional benefit was paid (example - we paid on the 1st of April, but the retiree died March 29th; he/she wasn't eligible to receive the 4/1 payment). We send our entire retiree database for a death records search twice a year, and 2 of the notifications came from there.

We have made several attempts to get the money back from the estates, but with no luck. Plan 1 is owed $3,000 (total Plan assets = $83.6M) and Plan 2 is owed $2,000 (total Plan assets = 19.5M).

Since our company just hired a corporate attorney, we are going to have him send a letter, but are not anticipating a response. In the total scheme of things, the amounts seem so small that it's not worth doing anything, but do we have to?

HELP!

How do you handle repayments on a previously defaulted loan, both for accounting and 5500 purposes? defaulted loan was treated as a deemed distribution, participant is still employed, and there is no distributable event.

We filed the extension form 5558 for a client for their profit sharing plan for plan year ending 12/31/04 in time but they just called to tell me that their other vendor did not file the 401k extension in time. Does anyone know if they can still send the form in and are there any penalities if they send it in late. thanks

HELP!! I have read everything I can find that is remotely related to this situation and have given myself a headache.

Sub-organization of church has a part-time employee who will, effective 9/1, be no longer eligible under the church-sponsored health plan which is changing the definition of eligible employee from 20 hours per week to 30 hours per week. The health plan is offering COBRA to the now ineligible employee. Organization would like to continue paying a portion (80%) of the employee's premiums, which are now COBRA premiums. I believe that this can be done under Code section 106 without being included in the employee's income; I also believe that the employee can keep using the employer's cafeteria plan to pay his portion pre-tax. My question is HOW?

If it will only be for one employee in this one situation, does the employer need a written plan? Can the employer simply keep paying its portion to the insurance company or must it reimburse the employee after he pays? Would it be sufficient for the employer to send the employee a letter outlining his COBRA eligiblity and stating that the employer will continue to pay 80% of the premium either directly to the insurance company or to the employee upon receipt of proof of payment?

WHERE can I find some practical guidance on setting this up??

Thank you in advance!

If an ESOP is terminated in connection with a merger and the consideration for the merger was all cash - do participants in the terminated ESOP have the right to request a stock distribution? Does the answer change is the deal was part stock and part cash? Since ESOP participants were given the right to choose cash or stock merger consideration - is the company obligated to give them a second choice?