A DB plan was amended during the current plan year to freeze accruals, before any benefits accrued during the plan year. I want to take into account this amendment when doing the beginning of the year valuation for this plan year. I don't want to go the 412©(8) route which requires applying to the DOL. Can I take into account this amendment?

The client terminated the MPPP two years ago and has been working to distribute all of the assets. Well, all assets were distributed early in 2005. Part of these assets were life ins. policies. It seems now that the Ins. Co. that provided these policies went through some kind of sale and has notified our client that additional money will be coming as a result of the ins. company sale. They can't tell us, however, how much it will be and when it will come. My question is whether or not the Trust has to keep the MM account open with the broker. It seems to me that if the INs. company issues checks in the name of the trust at some point in the future, the trust will need someway to deposit and then distribute these amounts. Suggestions?

Since an LLC owner does not receive w-2 compensation (just pass-thru comp), you will not know until the year end what amount should be reported as income, and hence what income to match. Are there any restrictions for an owner of an LLC to fund their account with the employer money throughout the year, before they know what the year end income will be? Or if they overfund, do they just have to take a distribution prior to the tax filing due date (like a traditional IRA)?

Please advise. Thank you!!!

Beneficiary owns various shares of stock direct and by application of the family attribution rules. Beneficiary is also the general partner of a limited partnership. I don't have the exact details yet on how this is structured, but in general terms, how do you attribute the stock in such a case. Assume I understand that the stock held by a parntership is attributed to the partner proportionately. I just haven't seen any guidance how to answer this question under 318 in the context of a limited partnership. Thanks.

Can anyone tell me where I can get totals on multiemployer plans and participants for welfare and pension plans?

Thank you

I am a computer programmer who has worked in the health care arena for the past ten years. Over the last year or so I have developed a system to help self insured entities control the cost of providing health care to their employee population. I am hoping to get some feedback from this group on the system. It contains 4 main applications:

Claims Review

This is a standard set of reports to help identify where claim dollars are going.

Some of the reports are: Cost by Benefit Category (Network & Non-Network Breakouts), Top Providers/Facilities, Cost by Diagnostic Category (MDC), Cost by Lifestyle Category, Network Savings

Trend Analysis

These reports show the cost trends broken down by the same set of reports listed above. Primarily I see these used for both early identification of (over) utilization and also to provide ROI validation of disease management & wellness programs.

Network Analyzer

Through the mining of historical claims that were originally repriced from a variety of PPO networks and the use of some algorithms I developed based off of this data and in comparison to the Medicare fee schedules I am able to take any distinct sponsors' claim set and reprice that claim set through all of the networks I have historical information on. I in turn can then reprice the fall out claims against the same networks that allow themselves to be 'wrapped' around another network for additional savings. I developed this in response to companies making network changes and basing the decision on discount averages supplied by the networks themselves and only being able to validate these discounts after a change has been made.

Plan Modeler

A user could define an entirely new SPD in the system and the Plan Modeler re-adjudicates that entire claim set to determine not only the savings/cost to the plan sponsor but also the exact impact to each employee. The user can use either an actual historical claim set or a historical claim set that was re-priced using the Network Analyzer.

I would like to see if these applications would provide sufficient value to their users or if there are other items that would be helpful to everyone.

If anyone would like to see the reports produced I would be happy to send them samples with blinded data, or I could send anyone a username/password for the website so they could run the applications against the companies loaded in the system (all data is blinded).

Thank you all in advance.

- Marc Pinkston

Hi - I was hoping to collect some thoughts on HIPAA security policies and procedures requirements. I've been looking for a good template to use for creating policies/procedures for our plan, but haven't really found one.

For a self-funded group health plan with a third-party administrator, what exactly are the requirements for establishing policies and procedures? Company employees do have some access to PHI. I've seen one approach is to say that since the plan does not have any of its own employees and does not own the equipment or media used to maintain/transmit ePHI, the risk analysis outcome is that the plan does not have control over most of the standards that HIPAA imposes, e.g., workforce security and information access management. The plan, being the only real "covered entity", then simply puts into place business associate agreements where necessary, appoints a security official, and ensures that the plan is properly amended for plan sponsor compliance. This approach then assumes that the plan sponsor only has the obligations imposed through the plan document, not including the establishment of policies and procedures.

Any thoughts about this approach? It seems like if this is correct, then most plans would not need to address most of the security standards set out in the regs - surely that can't be right. Am I missing something? And, can someone point me to a good template?

I have a DB plan that covers the owner and 4 employees. The owner is maxing out his benefits at the 415 dollar limit. My client just informed me that during 2004, he changed his corporate tax year from 6/1 - 5/31 to a calendar tax year. For the short tax year of 6/1/2004 - 12/31/2004 he deducted the full 6/1/04 - 5/31/2005 plan year contribution. So he and/or his accountant decided to us the contribution for the plan year that begins in the tax year. Then for the 2005 tax year, he'll be deducting the 6/1/05 - 5/31/06 plan year contribution.

First, does anyone see a problem with me switching the W-2 pays used from the current year pays to the prior year pays since the tax due date (without extension) will be before the end of the plan year? For my 6/1/04-5/31/05 plan year I used the pays earned during the plan year, but for 6/1/05 - 5/31/06 plan year I want to change my assumption and use the pay earned during the prior year (so I'd be using the same pay for two consecutive years.

Second, should I switch the plan year to a calendar year?

I have a DB plan that covers the owner and 4 employees. The owner is maxing out his benefits at the 415 dollar limit. My client just informed me that during 2004, he changed his corporate tax year from 6/1 - 5/31 to a calendar tax year. For the short tax year of 6/1/2004 - 12/31/2004 he deducted the full 6/1/04 - 5/31/2005 plan year contribution. So he and/or his accountant decided to us the contribution for the plan year that begins in the tax year. Then for the 2005 tax year, he'll be deducting the 6/1/05 - 5/31/06 plan year contribution.

First, does anyone see a problem with me switching the W-2 pays used from the current year pays to the prior year pays since the tax due date (without extension) will be before the end of the plan year? For my 6/1/04-5/31/05 plan year I used the pays earned during the plan year, but for 6/1/05 - 5/31/06 plan year I want to change my assumption and use the pay earned during the prior year (so I'd be using the same pay for two consecutive years.

Second, should I switch the plan year to a calendar year?

Is it the responsibility of the TPA to change the 1099R for the IRS Code and taxable distribution amounts if the participant elects to rollover the funds at a future date? Example, If a participant receives 8,000 of a 10,000 distribution, and elects to rollover the 8k within the 60 days, does the TPA provide 2 1099Rs, one to show the rollover of 8k and one to show 2k as taxable and include 2k taxes withheld? Or does the participant need only work it out with the IRS on their own?

What if the participant rolls over after the end of the year and within the 60 days?

Are church plans that are partially self funded regulated differently than employers in the private "commercial" sector?

Would it make a difference if there was more than one church in the same denomination as to how it might be regulated by the states?

Don Levit

This has not come up at our firm before. I think I know the answer, but would like to hear from others.

Someone with a low salary deferred about 96% of salary. After allocation of match and profit sharing, the total annual addition will exceed 100% of compensation. Can the excess above 100% be reclassified as catch-up. The excess is a total of about $75.

Thanks.

A calendar yr plan's entry dates are 1/1 & 7/1.

A participant who was eligible to enter on 07/01/04 terminated on that date with 1,040 hours of credited service. Hours required for benefit accrual are 1,000.

Assuming, he worked on 07/01/04, does the participant accrue a benefit under the plan?

I think he does.

Father and son are 50% owners in an incorporated business (Company A). Father and son are the only employees.

Son has self employed income from a flower and gift shop (Company B) that is run by him and his wife. Son is the 100% owner of the gift shop. The Son and his wife are employees and they have 2 other employees.

These have not been part of a group under common control.

Company A sponsors a profit sharing plan.

December 1993, the father dies leaving the son as 100% owner of Company A. They are now a group under common control.

Does the grace period for participation due to a change in the controlled group? When does the grace period end?

The answers seem to be yes and December 31, 2004. Any corrections? If this is accurate, can I file the IRS Form 5500-EZ for 2004?

Can a pre-service claim be denied for failure to obtain precertification if it is required or is the remedy for this failure imposing a penalty?

Is it possible to also get contributions to an employee after he/she stops working?

I.e. as an early retirement incentive, ABC College gets employee to accept

early retirement and stop working Sept. 1, 2005.

The college tops up so the entire $42,000 limit for 2005 is used.

In addition another $42,000 is placed in January 2, 2006 and finally

another smaller amount [to make the total addition payments equal to the lesser of $100,000 or one year's salary] is made on January 2, 2007.

Did I see this on this board?

Has there been either administrative action or legislative action since 1/1/2001?

Question about this use case:

401(k) plan

Mary makes $100,000

Plan limits are:

Pre-tax 40%

After-tax 40%

Total 40%

No employer contributions

Plan administers 50+ catch-up as a single rate arrangement whereby employee’s pre-tax contribution rate is intended to express both pre-tax and 50+ catch-up

If Mary wants to contribute 18% pre-tax for 2005 ($14,000 pre-tax $ limit + $4,000 catch-up $ limit), what’s the maximum after-tax Mary can contribute - $22,000? Or is it $26,000 because you don’t count the catch-up $ for purposes of the plan limit.

If $22,000 then Mary was able to increase the total pre-tax contributions she could otherwise make (from 14000 to 18000) without the 50+catch-up feature but her total permitted contributions remained unchanged at $40000.

Ta da!

http://www.careerjournal.com/salaryhiring/...614-intro1.html

We're finding many instances of employees leaving during the year with a debit balance in their FSA. They may have elected $1200 in their FSA, which means a $100/mo payroll deduction, filed claims earlier in the year, and were reimbursed the full $1200. In this scenario, they might have been reimbursed $100 x months not active more than they contributed.

A 1999 article in Benefitslink indicates that an employee may be asked to repay the amount, but, not forced. Is this still the case?