I ran 401(k) non-discrim. testing on Plan A for 2003 - plan failed and 4 HCE's recevied a refund - prior to 03/15/04.

In March 05 - ER discovers that 401(k) contribution for 12-26-2003 was never remitted to the trust and they send in the funds.

I retest 2003 and fina out plan still fails but refund amounts would be about 1/2 of what was initally paid out 1 year ago.

What corrective path does plan follow? Can HCE's put money back into the plan and then just amend the 1099's and have them amend their personal returns?

Does anyone know where I can find this oldie?

We are thinking about using the Executive Summary report in Relius' ReportWriter, but want a few modifications. Has anyone done this? Does anyone have a version that I could look at? Any help is appreciated.

We are thinking about using the Executive Summary report in Relius' ReportWriter, but want a few modifications. Has anyone done this? Does anyone have a version that I could look at? Any help is appreciated.

Is anyone aware of something in the Florida that says you must have the employees actual consent before taking any funds from payroll and putting them in a 401(k)? If it exists, I believe there would be a preemption issue but i still need to know.

ps. i did see the earlier thread but it was fairly old and did not mention florida.

Any suggestions on the standards that can be used to evaluate investments? Right now, the investment policy states that the investment committee will use Morningstar ratings as the standard. We are looking to expand on that.

DB plan sponsor receives and sends proposed QDRO to it's law firm who ok's it and it is recorded.

Recorded QDRO is sent to actuarial firm who immediately notices what looks like a problem. The QDRO divides an accrued benefit 50% participant, 50% spouse, without any actuarial adjustment, such that spouse who of course is younger is entitled to collect at same time and same amount as participant. This increases the pension obligation because spouse has a longer live expectancy.

What can/should be done other than notifying plan sponsor of opinion? Can it be changed? Must it be changed?

A 401(k) plan was a safe harbor plan in 2004 using a safe harbor basic match formula to satisfy the ADP. In 2005 the plan switched to a non-safe harbor plan using prior year testing. Can the safe harbor match that was made in 2004 be used to calculate the prior year ACP or is the prior year ACP 0% (no additional match made in 2004)?

Thank you.

One of our brokers is dealing with a municipality and they asked if 257 deferred comp plans could be attached by creditors.

Is there even such a thing as a 257 plan? I am just the messenger.

During my parents marriage, my father worked for a large US based company through which he could purchase stock. When he left that corporation 20 years ago, he and my mother moved back to the country of their birth. The country has a strict community property provision in its laws so as to consider that all stock would be jointly owned. It also has provisions in the estate laws whereby if no will exists, all heirs would have equal rights to the property in the estate. Thus, 50% of the stock would be considered part of the estate of the deceased and that 50% would be divided amonst the heirs.

My mother died three years ago and my father is trying hard not to reconcile her estate. His mistress at the time had moved in with him shortly after my mother's passing (they have not married). She is from a different country which is well known for younger women (in this case 40) finding older wealthy men (in this case 74) and disappearing with the man's money. Because of this, the children have decided to force the settlement so that the estate portion would be "saved" but my father keeps delaying things.

We put an "embargo" on the stock, which is serviced through a company in Rhode Island so that the money could not "disappear" which other assets have done over the last 3 years.

We now wonder if he will file suit against the RI company to cash in the stock, circumventing the laws in the country where the embargo is held and the testimony he gave to the judge in last year's hearing about his use of funds.

So the question is, based on this, in the US are there any "estate" rights to stock purchased under a company stock plan? Do the laws of the country where the individuals live have any bearing on the ownership?

Given the scenario that the corporation over last 3 years is no longer making even enough money to pay salaries and that it does not see it getting out of this recession, what can be done ? The money that was in the trust account already funded the VUL policies for employees.

So somehow can the plan be amended or terminated so that the cash values be rolled over to individual annuities or irrevocable life insurance policy trusts to avoid tax consequences for the employees and shareholders who will now work elsewhere or even retire ?

Goal is to avoid tax for the employees, leave/convert VUL insurance policies in place, & not having to pay any ongoing administration overhead.

The plan is set up for multiple employer trust (Master Trust)

The corporation has its own trust, part of the master trust.

Established in 1997 & funded thru 2001.

Proprietor has a normal SEP. My understanding is that the normal limits are 20% of income.

If instead a Simple IRA is established for 2004, I understand that they get a maximum of 10,000 plus 20% of income.( 11,000 income, over 50)

Maximum deduction of $12,700

Can this be set up now and contributions made before 04/15/2005

My father-in-law died on 6/6/04, he was 83 and had been taking RMDs since age 70-1/2. In addition to the spouse of his deceased brother, he was the only other remaining participant in a Profit Sharing Plan. The plan had a benificiary designation on file that his most recent spouse had signed (waiving her right to plan assets) which named his living trust as beneficiary. The benificiaries of the living trust are his four children (from previous marriage). The pension funds were not broken into separate accounts prior to his death. As the executor of his estate, I am trying to determine the options and requirements we have to distribute the pension funds to the multiple beneficiaries of his living (now irrevocable) trust. Can the funds be separated into respective shares now? Should distributions be made over the life of each child, over the life of the oldest beneficiary, or over what was his remaining life expectancy? Are there any roll-over options for the children? Where do I go to get a comprehensive overview of the issues relating to this situation? I would greatly appreciate any guidance!

In 1998, I began a Roth IRA and contributed annually the maximum amount allowed, however, at the end of 2003, the value of my Roth had greatly been decimated and I closed my Roth. All in all, I contributed $8,000 and its current value when I closed the Roth was roughly $5200. I had the 10% withdrawal penalty since I was younger than 59 1/2 at the time and filed my taxes as such with my tax preparer. Today I received a letter from the IRS stating that on my 2003 taxes, an omission of the $5200 was not claimed as income nor was the $520 penalty, resulting in my owing the IRS an additional $1800 (includes $94 in interest). I have a meeting with my tax preparer tomorrow but I would like anyone's input regarding my situation. I was under the impression that I could withdraw my contributions at any time tax and penalty-free and that I would only be taxed on the "earnings" portion of my Roth which I had none. To say I was caught off-guard would be an understatement. Any thoughts would be appreciated.

I'm reviewing assets for an end-of-year valuation and have discovered that part of last year's contribution was made by transferring shares of stock (nothing privately held-all on the market) into the plan. The funding deadline was several months ago.

This is of course a prohibited transaction, but does this also constitute an invalid contribution? In other words, can the contribution of the stock count toward satisfying the minimum funding, or is there a funding deficiency because of the fact that it's a prohibited transaction?

Has anyone heard anything further on when the IRS might be released the updated model 402(f) notice? I had seen things from seminars and articles that the IRS was working on a revised model 402(f) notice for the automatic rollover rules. Thanks.

Given the scenario that the corporation over last 3 years is no longer making even enough money to pay salaries and that it does not see it getting out of this recession, what can be done ? The money that was in the trust account already funded the VUL policies for employees.

So somehow can the plan be amended or terminated so that the cash values be rolled over to individual annuities or irrevocable life insurance policy trusts to avoid tax consequences for the employees and shareholders who will now work elsewhere or even retire ?

Goal is to avoid tax for the employees, leave/convert VUL insurance policies in place, & not having to pay any ongoing administration overhead.

The plan is set up for multiple employer trust (Master Trust)

The corporation has its own trust, part of the master trust.

Established in 1997 & funded thru 2001.

Seeking advice on what to do.

Can you exclude military pay for elective deferral and match? Or does that go against USERRA?

My client is an incorporated dental practice with a 10%! Safe Harbor NEC 401(k). The are two other dentists sharing office space, receptionists, billing clerk etc.

All employees are paid W-2 from the corporation. The two other dentists (being treated as sole-properietors) reimburse the corp for a pro-rata share of rent, insurance and pension contribution. There is no written partnership agreement.

One sole prop has a SEP and a part time employee he considers his (I guess he pays her directly). He wants to contribute for 2004. Any issues?

I don't have all the details but can get as much as necessary.

New client with 2 partners.... each partner filed for the SS4 for the new plan. Anyone dealt with this situation? Do you simply not use the extra SS4 ? do you notify Uncle Sam?