Are there any current Relius users that have past experience with Investlink (TSM) that would be willing to share some general thoughts on Relius vs TSM?

I have been working through some problems with a VEBA. Currently, the

VEBA (a multiemployer plan) allows a person to take his entire "account" balance upon a 12 month severance from employment. This provision applies regardless of the reason for leaving the trade...including retirement.

The regulations seem to clearly prohibit any severance pay that is triggered directly, or indirectly by a person's retirement. 29 CFR 2510.3-2(b). We also found a couple of cases that which held the same.

Am I missing anything? Is there a rule out there that would allow such a payment to be made?

I wanted to know what the process is to form a Roth IRA LLC and how to handle things like a rollover into it. Very little information is available on the net. Can I do it by myself by getting an EIN, what are the annual federal filing requirements for it and can the LLC act as the custodian of the account FBO of my roth IRA. My reason for the information is the prohibitive recurring fees most custodians charge for holding land within an IRA account. Can anyone help or give advice?

Employer maintains SIMPLE IRA at a financial institution. All the accounts under the SIMPLE is at the same financial institution.

Employer sent in checks to financial institution along with breakdown/allocation sheet.

Employer made a mistake (clerical error) and gave instructions to deposit more than the correct amount to one participant’s account, and less than the correct amount to the other participant. (One person got too much, and the other got too little).

These were employer matching contributions

Can the employer just send a letter to the financial institution to make the adjustment?

Is this affected by the irrevocability of IRA assets?

We have come across the case of a cash balance plan that bases it's interest credit off of S&P 500 rates.

The plan does not allow for distributions prior to normal retirement, so generally, the whipsaw effect doesn't affect the plan. However, the clients are interested in terminating the plan, and if that happens whipsaw will have a big effect, and we feel that the plan will be underfunded on a termination basis as a result.

Are there any issues with amending the interest credit rate to match the 417(e) rates? Are future interest credits a protected benefit?

My instinct is no because the 417(e) rate is variable itself, but I wanted to see if anyone has had any experience with this.

Thanks!

We are in a situation that may be unique, at least it is to us. A doctor who practiced until his recent death (age 87 or so) administrered his money purchase pension plan himself. There is approximately $1,200,00 in plan assets at a brokerage firm. He also filed the 5500's himself, but that's another story. It also appears that the plan has been frozen since at least 1994 sice the 5500's indicate that no contributions were made. The last 5500 filed was an EZ. No plan documents can be found.

We've been retained to correct the plan document problem. We're reasonably sure that the plan was never restated for GUST and EGTRRA. There is a good chance it wasn't updated for TRA'86 either, but we cannot tell without documents. Up until 1980 or so the plan was administered by a bank, so we're fairly certain that a document did exist at one time, but the bank no longer has a copy.

We've corrected for nonfiling under VCP, but never without any documents at all. Has anyone been in this situation? I've considered doing GUST and TRA 86 documents and filing under VCP. However, with no prior documents to begin with, I'm not sure this is the way to go. I've considered filing through VCP as a John Doe submission to get a feel for how the IRS would treat the plan. However, the family wants it resolved and time is important. Any ideas? Thank you.

We may have accidentally mailed a Form 5500-EZ to P.O. Box 7043 instead of the P.O. Box 7042 in Lawrence. We won't know for sure until our return receipt postcard comes back, which may not be for a week or two. This is a PYE 12/31/04 not on extension, due on the 31st / 1st.

I suggested that we mail a photocopy of the original filing to the correct address, and attach a memo stating that it may be a duplicate filing, or it may have been mailed to the incorrect address but that we are not sure. I would rather not put the return on extension at this point.

Any thoughts?

Thanks for your input.

LiP

Hello all,

I've found this board to be very helpful in the past, so I'm hoping to try my luck again today.

I'm relatively new to DB plans. I was asked to do some research regarding a small overpayment in a calendar year one participant DB for 2004 (approximately $500.00). The funding was made based on estimates from the actuary, but turned up lower than the expected at year end with actual information.

I've read prior posts and came across one that referenced the full funding limitation and irc 4973 (if I remember correctly). From what I've read, IRC 4973 states an exception to the DB funding where the employer can elect not to include contributions except above the calculated full funding limitation.

Would anyone be so kind as to help me with the following:

1. How to calculate the full funding limitation (hope this isnt asking too much)

2. Explanation of the exception/is my understanding correct?

3. How would this affect the corporate return for the client - I'm assuming if the contribution is limited to above the full funding that is all they can expense on their return?

Thanks in advance,

Vicki

If electing to take the 28%subsidy. How will your company Price their Retiree Medical plans for Medicare part D?

I have a participant who has re-financed two loans that he has in the plan. The maximum number of loans allowed is 2. He is now asking that we re-finance one of his loans again. Is this possible? Should we have even re-financed the second loan? Thanks.....

Articles and studies about plans providing automatic enrollment and automatic deferral increases are constant. Legislation is pending addressing these issues.

Automatic enrollment has been around for a while and is an option in most prototype documents. But automatic deferral increases is a fairly new thought and not contemplated when most prototypes were amended for GUST, etc.

Question - in order for an employer to utilize the automatic deferral increases, do you feel the plan document must specifically permit these increases? Or do you think if it's included in an annual notice (perhaps in the annual auto enroll notice if that too is being used) and in the SPD, that would suffice?

For those who may have employers using the automatic deferral increases, what have you/sponsors been doing?

Husband owns 100% of small business.

Wife is Husband's sole beneficiary.

Husband has daughter (now over 18) from previous marriage.

Wife has never legally adopted Husband's daughter.

Husband dies in car wreck.

Subsequently, Wife is now 100% owner of small business.

Husband's daughter works at small business.

Q: Is Husband's daughter Key, HCE, etc?

Can an office manager that is not an officer of the company sign the front page of the 5500 for the Plan Administrator or the Employer? This is a single company 401K. She is a trustee of the Plan. And I do mean signing her own name.

The new bankruptcy law appears to exempt participant loans from the bankruptcy process. I read the changes to state that the filing of a bankruptcy petition should not stop an employer from withholding loan payments from an employee's compensation (exempt from automatic stay). I also read it to state that a bankruptcy plan cannot alter the terms of a loan from a 401(a) plan and that compensation used to pay such a loan cannot be considered disposable income. Ultimately, it appears as though an employer should not have to do anything (with respect to a participant loan) when an employee files for bankruptcy.

An attorney recently drafted a new bankruptcy provision for a participant loan policy that says that the employer should cease withholding loan payments from an employee's compensation: (1) at the request of a participant in bankruptcy; or (2) on request by court order. Although I would not advise an employer to violate a court order, neither situation appears to warrant a stay under the new Act. Anyone care to comment?

The following question is so elementary, that it can get overlooked.

Say a client establishes a pension plan.

When setting up the pension account, clients run into difficulty, and financial institutions don't know how to handle the question "can you open a pension account for me?"

They respond with all sorts of forms (irrelevant or inapplicable) or that they can't do it, etc. Many banks, etc. think that they are being asked if they can provide the plan documents, administrative tools, etc. and thus get confused or say they don't do it.

My belief (and what I did for myself) is that all you need to do is establish an account called say The ABC Company, Inc. DBPP, give them the trust ID #, and Corp EIN if necessary and deposit and invest money.

When I told this to a very newvous client, he kept asking is that it are you a hundred %, and so on.

So my question is "Is this absolutely all that is needed to communicate to a client or should anything else be addressed?"

Thanks.

The subject company has an operating SIMPLE IRA plan established through Nopain-Nogain Mutual Funds. I haven't read the plan document, but I am assuming it designates Nopain-Nogain as the only financial institution that can accept IRA contributions. The employer would like to offer increased investment options to their employees by opening the plan up to include investments from BrandX Mutual Funds too.

Section Section 219(g) describes the types of plans which an employer cannot make contributions to during the same year they make contributions to a SIMPLE plan. The plans listed in Section 219(g) include SIMPLE plans, therefore it appears an employer cannot have two SIMPLE plans during the same year.

So, I am concluding that the only way to acheive what the employer wants is to wait until the end of the year, terminate the current SIMPLE plan with the designated financial institution, and adopt a new plan without a designated financial institution effective January 1st. (And providing at least 60 days advance notice of the change) This will open the plan up so that the employees will be able to direct their IRA's be placed anywhere, and not just limited to Nopain-Nogain and BrandX. Is there any way to limit the plan to just these two investment sources (who are competitors)?

Here's a fun one (at least fun for us benefit geeks). Is an employer responsible for computing and reporting the additional interest? Also, is an employer obligated to report and withhold the penalty amount. We have a situation where an employee will recieve an amount which will be subject to both the additional interest and penalty amount. I just don't know how to handle it. I would appreciate any feedback from anyone that has come across this situation or has a better handle on it than me. Thanks.

My eyes have glazed over reading the final regs. Three things:

Item #1------ 1.401(k)-1(a)(4)(ii) - "Treatment of Elective Contributions as Employer Contributions" - states that deferrals are treated as employer contributions under IRC 404. I thought EGTRRA changed this. How is this applied?

Item #2------ Same cite says deferrals are treated as employer contributions under IRC 411. Some comments say this means that a participant who is zero vested in Employer contributions but has made deferrals is not treated as non-vested for purposes of rule of parity for vesting. Even if this is so, does this also apply for rule of parity for eligiblity as well?

Item #3------- Taking this further to the deemed cashout provision, is this to be interpreted that in the case of an employee who has deferred, but is zero vested in Employer contributions, such employee's non-vested Employer contributions may not be forfeited immediately upon termination if the deferrals remain in the plan?

Thanks for any help in sorting this out.

Here's what should be a simple question, but the question has thrown me. Can a health care FSA be offered to retirees? I know a cafeteria plan must be for employees and cannot be created just for retirees. But the definition of "employee" includes present and former employees. So, doesn't that mean that an FSA can be offered to retirees as long as its also available to active employees? Or am I missing some other provision of the rules?

I have a situation where a new plan would like to seperate certain HCE's and allocate a different %. Is it acceptable to define the following:

Non-partner Physicians (they happen to be HCE's)

Other Highly Compensated Participants

Thanks.