My sister is no longer working for the school, but she receives contributions, which they say she will continue to get for five years. (They call it post separation amounts).

Can she take a withdrawal from, her 403(b) or will she have to wait until she stops receiving these amounts?

I am being told by my district that because I have a loan against my 403b assets that I cannot continue my monthly contributions. No one at the district can point to that in writing, except to say that the district's Third Party Administrator says so. Does anyone know if this is true or not?

I am aware that a surviving spouse who inherits an IRA from a deceased spouse can roll over the IRA and will not be required to take required minimum distributions until he/she reaches his/her required beginning distribution date.

Does anyone know if the law has changed for non-spousal beneficiaries so that now they too can roll over an inherited IRA and not be required to take required minimum distributions?

Does anyone know the statute or regulations that cover this area?

Thanks to everyone and have a wonderful weekend.

I have the option to start in the begining of July - 401(k) with my new employer . I have an existing Traditional IRA with Mutual Fund with less that $ 5000 in it. What is better in my case? To have both or to rollover my IRA to 401? My employer will match up to 5% of my contributions.

Thanks in advance!

You might be a redneck Jedi if...

1. You ever heard the phrase, "May the force be with y'all."

2. Your Jedi robe is a camouflage color.

3. You have ever used your light saber to open a bottle of Bud.

4. At least one wing of your X-Wing fighter is primer colored.

5. You have Bantha horns on the front of your land speeder.

6. You can easily describe the taste of an Ewok.

7. You have ever had an X-wing up on blocks in your yard.

8. You ever lost a hand during a light saber fight because you had to spit.

9. The worst part of spending time on Dagobah is the “dadgum skeeters”.

10. Wookies are offended by your B.O.

11. You have ever used the Force to get yourself another beer so you didn't have to wait for a commercial.

12. You have ever used the force in conjunction with fishing or bowling.

13. Your father has ever said to you, "Shoot, son come on over to the Dark Side...it'll be a hoot."

14. You have ever had your R-2 unit use its self-defense electro-shock thingy to get the barbecue grill to light.

15. You have a Confederate flag painted on the hood of your landspeeder.

16. Although you had to kill him, you kinda thought that Jabba the Hutt had a pretty good handle on how to treat his women.

17. You have ever accidentally referred to Darth Vader's evil empire as "them damn Yankees."

18. You have a cousin who bears a strong resemblance to Chewbacca.

19. You suggested that they outfit the Millennium Falcon with redwood deck.

20. You were the only person drinking Jack Daniels on the rocks during the cantina scene.

21. If you've ever heard "Luke, I am your father...and your uncle!"

Question-

We have a prospect - has an existing 401(K) Plan.

Seems as if for several prior years, the company has "accrued" a Company

Match, took a deduction on the Corporate Tax Return, but did NOT ever fund

the contributions.

1) Can the client go back and file amended tax returns and revise the

Participant Accounts to eliminate the Match that was never made ?

2) Would this require the use of one of the IRS VCR programs ?

Or is the client "obligated" to make the Match Contributions ?

3) One opinion is that the IRS would consider it a prohibited

transaction - essentially a "loan" from the plan equal to the Match

Contributions.

Do you think that this is the case ?

Any suggestions ?

Can someone please direct me to a site where it indicates which state's do/do not allow for automatic enrollments (or you may refer to it as passive or negative election enrollments.)

Thank you

Our company would like to set up a Cafeteria Plan mid year 7/1/2005.

1. What would the effective date of the Plan be 1/1 or 7/1 and would the limits need to be reduced for the time the Plan not effective. i.e 2500 for dependant care instead of 5,000.

2. If a participant does not return his enrollment form on time can they do it the next entry date within the same year or must the wait until the next Plan year or 1/1/2006.

3. Can a participant elect to no longer put away money once an election has been made if they do not have a life cahnging event.

Has anyone ever heard of a group of government employees taking their "share" of plan assets and trasferring to a defined contribution plan? In this case the group comprises 75 employees of a total of about 600 actives, but there are 300 inactive employees including 200 retireds.

The goal here is to allocate the funds in a fair and equitable manner, leaving the remaining employees in no better or worse position than those exiting the plan. The plan currently is about 90% funded on a FAS 35 basis, and about 70% funded on a plan termination basis. (The government entity does not intend to terminate the plan.)

Is it necessary to perform a full-blown ERISA 4044 allocation, or would some other method produce roughly equal results?

Several TPAs have told me that a former participant in a dep care FSA (employment terms mid-year) with an unused balance at date of termination can continue to file for claims incurred after the term date for the unused balance, to end of plan yr.

For health care FSA, have to go on COBRA, make after-tax pmts., etc.

What differentiates this in Sec. 125 (or 129)? In other words, why not let the health care FSA participant just continue to file claims incurred after term. date without bothering with COBRA?

Most docs we have reviewed or written state participation ends at term of employment.

Thanks.

After 2005:

1. Can a deferral agreement/election that is made, be rescinded? And,

2. Under what circumstances can a nq plan be terminated.

Huge thank you

Just picked up a client that didn't make their 2000 ($30K) or 2001 ($9K) money purchase contributions. Luckily, the plan was converted to PS in early 2002, so there were no more required contributions. And now we want to make things as right as can be, given the circumstances.

If I understand the pyramid-like way this is supposed to work, I think I submit the following Forms 5330 with the penalties like so:

2001: $30K * 10% = $3,000

2002: ($30K * 2 + $9K) * 10% = $6,900

2003: ($30K * 3 + $9K * 2) * 10% = $10,800

2004: ($30K * 4 + $9K * 3) * 10% = $14,700

2005: ($30K * 5 + $9K * 4) * 10% = $18,600

Total penalty due: $54,000

And don't even get me started on earnings calculations... unless, that is, they're counted in the accumulated funding deficiency (which I don't believe they are).

Does this look right? I know I can't be the only one with a plan like this... thanks.

This company at one time had over 30 participants. Now there is one last terminated participant who has a loan. He wants to repay the loan prior to rolling it over to an IRA. Is there any reason why I cant file a 5500 EZ?

A 40 year old participant in a PS plan (with rollover money) is looking to take a hardship withdrawal for almost all of his account balance for the purchase of a home (1st time home buyer). Am I correct that this is not an eligible rollover distribution and therefore taxes do not need to be withheld? Also, the 10% early distribution tax does apply so he could gross up the hardship amount to cover the 10% penalty. Finally, can the TPA fee be paid directly from the participants account?

Thanks

Should you use code 3e, or any other code on the 5500, to identify a volume submitter plan?

I am very new to this area and do not work with IRAs much and given that Section 529 plans are relatively new, I am hoping someone can help me. My question is:

Can an owner of an IRA make a death beneficiary designation in favor of a Section 529 plan/acct?

Contributions to a defined contribution plan generally must be made by the time for filing the employer's tax return, plus extensions. What is the contribution deadline for an entity that is not required to file tax returns?

Cites would be helpful.

Employee terminates employment 12/31/04. Anniversary date of PSP is 6/30. Plan says terminated participant's account balance will be distributed as soon as administratively feasible after anniversary date coinciding with or next following date of termination of employment. Broker was notified in writing that no distributions were to be made without authorization from Plan trustees. Terminated participant talks to broker and broker distributes 10K out of terminated participant's account in March 2005 without communicating with trustees. From the dollar perspective there won't be a problem b/c participant's account balance is sizeable enough that the early distribution of the 10K won't create an issue of trying to get money back from the participant. However, it seems there is an operational defect as well as a reporting problem that has to be dealt with. Not only has the distribution been made prior to the distribution date in the PSP, but now distributions will be in two different Plan years. Also, the Plan only allows for one lump sum payment. I understand from the accountant that the coding on the distribution will be an issue. It won't work out the immediate issues but would an indemnification/hold harmless type agreement from the broker and possibly the participant as well suffice as to the consequences of the operational issues? Need some suggestions.... Thanks.

Employee terminates employment 12/31/04. Anniversary date of PSP is 6/30. Plan says terminated participant's account balance will be distributed as soon as administratively feasible after anniversary date coinciding with or next following date of termination of employment. Broker was notified in writing that no distributions were to be made without authorization from Plan trustees. Terminated participant talks to broker and broker distributes 10K out of terminated participant's account in March 2005 without communicating with trustees. From the dollar perspective there won't be a problem b/c participant's account balance is sizeable enough that the early distribution of the 10K won't create an issue of trying to get money back from the participant. However, it seems there is an operational defect as well as a reporting problem that has to be dealt with. Not only has the distribution been made prior to the distribution date in the PSP, but now distributions will be in two different Plan years. Also, the Plan only allows for one lump sum payment. I understand from the accountant that the coding on the distribution will be an issue. It won't work out the immediate issues but would an indemnification/hold harmless type agreement from the broker and possibly the participant as well suffice as to the consequences of the operational issues? Need some suggestions.... Thanks.

First, I apologize for putting this in (probably) the wrong forum. I'm just concerned that no one would look at the "investment" topic.

Anyway, we have a large ($20MM) plan with American Funds A shares. They'd prefer not to go to R4 shares.

We are wondering how serious of a problem it is to not have a good "safe" option. The CMT (cash mgmt. trust) yields a pitiful .35% - there is no real GIC/safe option that returns what one might expect for that class.

The gvt. bond fund is not a "safe" option that is a member of this asset class. We'd prefer to stay on the current platform (old TRAC/DISC system).

Any suggestions? Is this a fiduciary breach?

thx!!