Assume a cash balance plan with different levels of benefits for various groups, for example the formula for owners is 20% of compensation and the formula for non-owners is 10% of compensation. Further assume the plan passes the general test. Finally, assume that after the plan has been operating for a few years, a non-owner becomes an owner. Are you aware of a citation that would allow the participant to move to the higher benefit level without creating a backloading problem?

Question: With regard to plan design, is there any reason the plan should not permit a beneficiary to a 401(k) plan to change a distribution option from installments to lump sum, or vice versa?

We have a situation where we are required to garnish wages for a participant pursuant to a Chapter 13 Bankruptcy. Recently the participant has had a reduction in hours and can no longer pay her group term and short term disability premiums because the garnishment consists of her entire check. Should we simply cancel the insurance? Should the participant be given a period of time to make up the premiums? Any help would be appreciated. Thanks.

I've sort of fallen into handling a 403(b) plan; some questions came up and I'm looking for some guidance, since this is not really my area of expertise.

Client is unhappy with investments, and is considering amending their existing PS plan to a 401(k) and getting rid of the 403(b) (the 403(b) has a match if that makes a difference). My initial reaction was "why not just add a different investment choice?" and I'm not sure I got a good answer to that, but if anyone has any general comments on whether or not this is a sound idea I'd like to hear them.

If they decide to go ahead, is there anything special about terminating a 403(b)? Do you just say in a resolution that it's term'd and that's about the end of it? Or does the existence of the contracts mean that the plan goes on indefinitely, even if no new money is added?

Thanks for any feedback.

Hi! I'm a British journalist, working on an article about the long-term problems facing the PBGC. I'll be speaking to the usual raft of pensions industry sages and luminaries, but I'm also keen to get to grips with the underlying issues by speaking to people who are working at the coal face.

I'd be keen to speak with anyone who has been involved in plan terminations, or is considering this option.

If you have the time (and, obviously, the inclination) to contribute your opinion, mail me or PM me, and I'll get in touch with you. I'd obviously prefer to hear from people who are happy to speak on the record, but if you require anonymity, I'd still be interested in your views.

We are considering rolling a QSERP into our DB plan to help rectify disparities created by the $210,000 maximum compensation cap. However, it appears that we would have to list each HCE out by name and perhaps even list his or her new additional benefit alloted due to removing the compensation cap. Is this true? Do you have to spell it out that way in the Plan document and/or appendix. We don't publicize salary ranges for executivie positions. Any way around this?

Can a Plan that currently provides for a normal retirement age of 60 increase the normal retirement age to 65?

If yes, can the amendment be effective mid year?

I'm guessing that anyone who has already attained age 60 must still be considered at Normal Retirement Age, but at what point does the anti-cutback rules apply?

For example, if the amendment is effective July 1 and a participants turns 60 on July 2nd?

Also, if the Plan uses an allocation based on age at normal retirement, and the amendment is made after the start of the plan year, is there an anti-cutback issue if the plan requires last day employment?

Thanks!

Here’s the situation. I have a client with a 401(k) plan who was owned by a few doctors a number of years ago. A few years into the business, each doctor decided to start his own PC and each PC would own the portion of the client entity. All three doctors adopted the client entity’s 401(k) plan. In 2003, one of the partner/doctors (PC owner) decided that he was going to retire. He did so for three months. At the end of the three months, he was hired as an employee of the client entity. My questions are as follows:

1) Does he have to satisfy the eligibility requirements (from scratch) of the plan as an employee?

2) If not, does he come in immediately as a participant using his past service in his own PC?

3) If he made over 90,000 combined in 2003, but only 50,000 as an employee, is he considered an HCE for 2004?

4) For top heavy purposes, is he considered a former key employee going forward?

I have a real issue I have four companies with ownership issues that change yearly.

In 2003, all four plans operated under on plan document - Company A. There was an ownership change in 1/1/2004 and here is where I am as of 12/31/04.

Company A and D share a Plan Doc, B and C have their own plan docs. Owner X is the Dad, Owner Y in the Daughter - over 21, Owner Z is the son - over 21.

Company A (EOY 2003 - Employees= 250) (2004 Employees = 20 EOY) Owner X 90%, Owner Y 10%, Owner Z 10%

Company B (Employees = 51 EOY) Owner X 59.5%, Owner Y 30%, Others 10.5%

Company C (Employees = 38 EOY)Owner X 25%, Others 75% Owners Y and Z have nothing to do with this company.

Company D (Employees = 40 EOY) Owner Y 100% - Owners X and Z have nothing to do with this company.

What are the control groups?

Also, as far as the 5500, how is it filed for 2004? Who is combined?

Thanks!

Is there a deadline by when a company must match their employees deferrals in a safe harbor plan?

Good Morning:

Does anyone have or know of any kind of "White Paper" or other research that shows the benefits of adding a deferral feature to a Profit Sharing plan.

We have a prospect, an old line manufacturer, who has had a PS plan, but never added a deferral feature. When our sales people met with the

prospect, the prospect said they were afraid that adding deferrals would cause them to be a "top hat" plan (I assume they meant top heavy). I don't have any

census information, but assume they have the "normal" percentages of HCE's and NHCE's. I also do not know if they have any Non-Qualified plans or

not.

According to the sales people, the HR person wants to add the feature, but needs something in writing that states the benefits of adding the deferral feature,

but also points out any items to watch out for when adding this feature. Something from a respected, independent source like a trade group journal

or law firm, etc.

I need to get this white paper to the client before I can get out to talk to them.

Your help is greatly appreciated.

Regards,

Willow

B.Sc Finance Part-Time in BMUniversity at Switzerland,Europe & Geneva.

The program of Bachelor (BBA or BSc) includes either a full-time program of 3 years or a part-time program over 4 years. It is conceived to distribute to the students an understanding of the concepts and practices in finance and in management, as well as forces leading recent economic changes. The University leans on teachers who have a great professional experience and a very high level of theoretical knowledge and can commuicate their knowhow. The programme is of particular relevance to those working in, or planning to work in: Orientations: Corporate Finance Private Banking Banking Insurance Total number of credits required: -180 credits (which represent 1800 contact hours plus a total of 3600 study hours) Length of study : -3 year for the full time program -or 4 years for part time program -The pogram has to be finished in a max of 6 years .

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A group of actuaries is considering a meeting in Los Angeles, possibly June 6 or July 11, at the Price Raffel offices in Century City. We hope to prepare a breakdown of the proposed new 415 regulations issued today. The meeting might be expanded to other topics as well. If you are an enrolled actuary interested in a peer-group discussion, feel free to contact me directly for more information and details.

The IRS has issued a draft version of the 2005 form 8606. Still no mention of accounting for rollover of after-tax assets from QP.

d8606.pdf

I am a brand new attorney ( I have been sworn in for less than 24 hours) and I have a question about employer contributions to a NQDC plan. I am working on revisions of a plan that was redrafted earlier this year to comply with 409A. Are there any limits to employer contributions? (this is not a 457 plan). They use the title "Long Term Incentive Plan" for the employer contributions, but no explaination of what this means.

A guy wanted to purchase real estate from himself using pension assets from the plan he sponsored.

Told him PT, no direct sales with interested party and plan.

He then offerred to sell the real estate to a separate party for $1 then to have the plan purchase it for $1, thus avoiding the direct sale.

It does not seem reasonable. Perhaps it would be considered a PT by means of an indirect sale or some other reason.

Curious to hear them.

And finally, if the plan purchased this real estate for $1 then the plan would likely be severely overfunded for the remainder of the plan with surplus assets at termination if the real estate is worth say $500,000 for example, thus an insane high return on investment.

A signficant # of participants have been missed for passed few years. Will client have to redo the PBGC for each year and redo the FSA for all prior years that were effected? Would this also effect the prior corporate returns which would then have to be amended.?

Does anyone know of any reason that a governmental plan could not exclude part-time employees from the Plan? Obviously, this is unacceptable in a private-sector plan due to Section 410; however, because governamental employers are exempted from 410 and it appears that the pre-ERISA 401(a)(3) does not apply, would this be acceptable?

We generally think of welfare plans as being contract rights that can be transferred from one sponsor to another in an asset sale, although they are just terminated in most cases. What about health FSAs? Transferring one in an asset sale seems so much like a rollover of the unused amounts that I am cautious. Simple example would be an asset sale where all employees go over to purchaser and purchaser wants to assume all plans. Can the health FSA go over?

At what point do you value the assets for the exemption? Are receivables included? For example a single k has $80,000 as of 12/31/2004 and will contribute $40,000 for 2004 on 9/15/2005. Is a 5500 required to be filed for 2004? Is it the account value AT ANY TIME during the plan year?