We have a health plan that simply defines dependent as a child until age 19 (23 if full-time student) and the parent provides over 50% of his or her support. The WFTRA, however, broke the definition of dependent into two categories. My question is whether it is necessary to amend our definition to include the age, support and residency requirement for a "qualifying child?" We only cover children who get more than 50% of their support from their parents, so the way I see it we will always satisfy at least the "qualifying relative" definition. Any thoughts?

We have a DB plan with a provision that if a person comes back to work within 5 years they can repay a prior lump sum payout in order to get service restored.

My questions are as follows:

If the person needs to repay $74,000~

Can they pay any of the amount needed with money in their checking or savings account? I am under the impression that they cant since the plan is tax qualified.

If they can pay from personal funds, is there a limit to the amount they can repay from them - Code Section 415 limit of $42,000 per year????

Would this impact how much they can contribute to other plans, like a 401(k) during the same calendar year?

It is my belief that all money they use to buy back service must come from another tax qualified source, i.e. conduit IRA, etc....

Any help you can provide on clearing this up for me would be greatly appreciated!!!!

Thanks

Is there alternative contribution formulas for a SEP - i.e. integrated with SS or is the only acceptable formula pro-rata?

Employer recently changed custodians for its SEP. In the process, several individuals chose to have their accounts at a different institution. Employer asked them to provide the account information and employer made SEP contribution to those accounts. (Contribution made approximately July 2004; calendar year plan.)

Employer has now learned that some of those accounts were an employee's existing traditional IRA, and not an IRA devoted solely to the SEP. Is this a problem for the employer? For the employee? What actions, if any, should/can employer take with respect to the contributions already made?

(Employer was switching to monthly contributions in 2005, but they are being held up for the accounts in question.)

A one-participant DBPP has a total of say $125,000 in plan assets, where say $75,000 is due to a rollover from another plan. Therefore, the DB assets for funding is close to $50,000.

Is this plan required to file a 5500-EZ in this case? Based on the form instructions I did not ascertain any definitive indication.

Thanks.

Effective 01/01/04,an employer adopted a regional prototype PSP with a 401(k) provision.

Employer accidently checked a box to state that HCEs aren't eligible to participate. This is wrong wrong wrong and certainly wasn't the employer's intention. The HCEs enrolled in the plan last year and made elective deferrals contributions throughout 2004.

How can this problem be fixed? Can the employer make a retroactive change to the adoption agreement? Does the employer need to use a correction program and pay a user fee?

Thank you in advance. I slipped on some ice yesterday and broke my arm and wrist. Today, I'm trying to get some work done and am reaching out for whatever help I can find.

The prior TPA used K-1 income and reduced it by a Schedule E for unreimbursed partnership expenses. Is this correct? Where can I find instructions on what to reduce K-1 income by?

I have a DB plan that requires contributions from eligible ees. Automatic deductions from compensation. I've never seen anything like this. What could be the purpose? The plan has been restated with all the bells and whistles, so it's been looked at during the past few years.

Is this permissible.

The IRS has issued PLR 200453015 which permits a participant who is a 5% owner to rollover his account balance to a Q plan of a separate employer where he is an employee but not a 5% owner and defer commencement of MRD until he retires. The only requirement is that the owner must take his MRD for the year of the rollover from the transferring plan. This ruling should be applicable to similar situations such as a rollover from an IRA to a qual plan or 403b annuity after 70 1/2 or rollover from a Q plan to a 403(b) annuity.

Is there a government guidelined format for submitting a new new comparability plan? or will they except any format? if there is a format, does anyone know where I can find a copy of what they want it to look like?

Thanks Andrew

We use Autodoc for Plan Documents. There is no defination of age contained in the Plan.

Do we use age nearest or age last birthday? Since the Plan does not contain a defination, I feel we can use either, so long as we apply it the same way each year.

Thoughts?

We have a client that sponsors a defined benefit plan type supplemental executive retirement program (the type of plan the IRS refers to in IRS Notice 2005-1 as a "nonaccount balance plan"). The SERP is subject to Code Section 409A. The question we have is (1) whether the SERP is subject to the deferral election requirements and (2) if so, how the amount of the deferral each year should be computed. If the SERP is subject to the deferral election requirements (and we cannot figure out a reason why it would not be), then the 2005 deferral election must be made by March 15, 2005. If the IRS does not issue further guidance between now and then, the deferral election will have to be completed before the IRS provides guidance on how a deferral to a nonaccount balance plan is computed. We recognize that a good faith interpretation of the rules may be necessary and are wondering if any other practioners are dealing with this same issue. Thanks in advance for any comments/suggestions.

I also posted this question in the Distributions & Loans Forum....I wanted to make sure everyone got a chance to take a look, so I also posted here!

Okay, I understand the loan repayments on a deemed loan generate basis and are not considered employee contributions for purposes of the nondiscrimination test under §401(m) nor for purposes of the §415 limits.

My question is, how are these repayments treated for future distributions? For all of the recordkeepers out there.....(or anyone else who can answer this!), how are the loan repayments put back into the participant's account?

For example, you have a deemed loan repayment of $3,000. The original loan was taken out as $2,000 deferrals, and $1,000 match. When you process the deemed loan repayment, do you have to deposit back into the account as deferral and match, or can you redeposit it as after-tax?

If you have to deposit it as deferral and match, you now have basis in "pre-tax" sources? If you redeposit it as after-tax, are they now subject to after-tax withdrawal requirements?

Any cites would be greatly appreciated!!

Hi...I am interested in knowing if there is a maximum contribution allowed in a life time and not in a calendar year.

I am aware of the annual limits but I am curious if someone is labeled as a (HCE)Highly Compensated Employee is there a limit on how long one can contribute or a max they can contribute? If the employee is earning $150k plus can the employee contribute (the annual max) for the next 30 years as long as they are employed? Or is there a max. or can you cap out?

If someone can give me any guidance or point me in the direction that can help it would greatly be appreciated.

Thanks in advance.

I'm just signing up for my company's 401k program. They use Fidelity and there are 3 index funds I'm thinking about equally putting my contributions into. I'm 27 years old so I know I should be on the aggressive side. They are:

NTGI S&P 500 EQ INDX

NTGI RUSSLL 2000 IDX

NTGI EAFE INDEX

However, other than on my 401k's website, I cant find any mention of these funds. Nothing comes up when I try to google them, unlike the Vanguard funds I have in my Roth. The first one looks like Vanguard's S&P 500 Index fund, the 2nd looks similar to Vanguard Small-Cap Index fund, and the 3rd is an International fund.

Does anyone know if these are descent funds, if having these 3 would give me enough diversity, and if I should also throw a small percentage into a bond fund just to be careful?

What are the thoughts out there against excluding hourlies from participating in a 401(k) and limiting participation to salaried only? I'm trying to make a case for opening eligibility up, and I'm being met with arguments. We have a db plan that includes everyone, but our 401(k) is very restricted (only salaried). I've tried the argument that this will look like a discriminatory HCE set-up and didn't get very far.

This is a factory situation, but low turnover of hourly employees.

Is there any reason why a not for profit organization that has only one employee cannot setup a premium only cafeteria plan?

Are there rules analogous to 412©(8) for amendments INCREASING benefits? What is the deadline, anyway?

2.5mos > PYE?

Tax Return Filing Date?

Tax Return Deadline (assuming refiling)?

Other?

TIA!

Mark

An employee's entry date for the 401(k) plan is 1/1/04. He terminates on 12/26/03. Yet, the paycheck for the payroll period ended 12/26/03 is paid on 1/2/04. Could that person have made a 401(k) contribution for that payroll period ended 12/26/03? In my case, he did not. Should he be on the 2004 ADP test with a 0% deferral rate? Or is he excluded from the 2004 ADP test because he physically did not work in 2004?

some of the companies leased employees are allowed to participate in the profit sharing plan but since the company does not have a 401(k), they would like to participate in the leasing companies 401(k) plan. can they participate in both plans if one is a profit sharing and the other is a K plan?