I Know self employed business structures (sole props, partnerships LLCs) dont. Are all c and s corps required?

What types of contributions are possible? Cash only? Or are other types of assets allowed? What are the rules?

Are custodians limited to companies with offices in the U.S.?

One of our clients was recently told by their payroll company that he had read that the safe harbor match contribution must be contributed each pay period, as the salary deferrals contribution. This make no sense to us, but my manager asked me to look into it.

Has anyone out there heard of such a requirement?

Thank you.

I am wanting to set up a Roth and would like info on what the "custodian" actually amounts to. I have Scott Trade & Edward Jones accounts, have requested an app from Scot and received info from Legg Mason. What would be the differences in using a broker such as Scot or contributing directly to a fund family such as Legg. (Fees?) Also, can I change custodians at a later date? I am in my mid 50's and will probably work at least 10 more yrs. I'm in a tax-deferred 457 plan and want to start a Roth before April 15 so that my holding period will begin in 2004.

Info will be appreciated. (Including links or reference material.)

Mrcharols

If an owner of a partnership receives regular earnings through payroll that generate a W2 and files a K-1 for his/her share of partnership income, do you add the W2 and K-1 together for plan compensation purposes?

It has been my understanding that a partner in a partnership should not have W2 earnings and it is their earned income from their K-1 that is used for qualified retirement plan purposes. Has anyone come across a partnership, or sole prop for that matter, that receives W2 income? And if so, what amount is used for compensation for plan purposes (i.e. testing, benefit calcs)

Can an Employer sponsoring a cross tested 401(k) PSP that had made quarterly deposits throughout 2004, decide to change their minds now and reduce the employer allocation formula for 2004? Specifically, the client wants to remove ER PS contributions from each Participant's PS source. This is an allocated plan. Bottom line: they feel 7% is too rich of a benefit and they want to scale it back to 3% for 2004 and for future years.

USERRA requires the employer to offer COBRA-like continuation rights to employees going into military service for medical coverage for up to 24 months. Any thoughts on whether this applies to a medical flexible spending account?

If a plan switches to a safe harbor match from a discretionary match and there are discretionary match forfeitures in a suspense account can those be used to offset future safe harbor match contributions?

A participant called and said their electronic filing was rejected because the employer ID did not match to anything in the IRS' records.

This sounds familiar...I think I had one of these last year...don't quite remember the outcome.

Any experience with this? Could it be related to the IRS' program to de-activate numbers that aren't used regularly? (But that shouldn't be the case with this plan, which has had fairly consistent activity.)

A client with a new HR administrator is trying to figure out the history of the company's 403(a) plan. There are records indicating that it used to be a 403(b) plan but was restated as a 403(a) plan in 89. That is before my time, was there some sort of transition relief that made that possible back then? There are other documents that indicate the 403(b) plan was considered terminated, my guess is nothing was documented consistently. Thanks

I need some help with the following RMD:

Participant is a terminated vested non-5% owner. Employer was unable to locate him until this year, which is why he did not go into pay status at age 65.

Plan actuarial equivalence = UP84 (pre and post retirement mortality) @ 7.00%

DOB = 10/1/1933

Initial distribution year = 2004 (first RMD must be paid by 4/1/2005)

Monthly accrued benefit at 12/31/2003 = 165.93

Age at 12/31/2003 = 70.25

Present value of AB at 12/31/2003 = 165.93 x 90.5175 = $15,019.57

Applicable divisor from Uniform Life Table = 26.5 (using participant's age in 2004)

Required Minimum Distribution that must be paid by 4/1/05:

$15,019.57 / 26.5 = $566.79

Two questions:

1) Is the above calculated correctly?

2) How do you calculate the amount of the next Required Minimum Distribution (that must be paid by 12/31/2005)? (Please use actual numbers)

I need to know the deadlines for amending plans to comply with these two law changes. I know they go way back and I can't find my old stuff. OBRA 93 change for rollovers and 401(a)(17) reduction to 150,000.

A public company wishes to use company stock in their 401(k) plan (as a match or profit sharing contribution, and an investment option). Are there restrictions on the amount of stock used as a match or a profit sharing contribution? Is a stock match/contribution the same as a cash match/contribution for 401(a)4 testing and safe-harbor?

I have seen previous discussions concerning a KSOP plan design. Based on what I have read, it seems that the primary advantage to creating a 401(k)/ESOP plan would be that the dividend would be tax deductible. Is this correct?

A company has a 401k plan with less than 120 participants. They have acquired a

second company. When the second company's employees become eligible they will have well over the 120 participant count that requires an audit. Is there any

problem in establishing a second identical plan for the new company's employees to avoid the audit requirement for both plans? Is there any problem in including

all new hires in the original company in the second plan to assure that the first remains below the audit level of 120 participants?

We have a plan changing from a fiscal to a calendar plan year. We will have a

short (1 month) plan year. The plan uses the prior year testing method. For the calendar year following the short 1 month plan year, is it proper to use the NHCE

%'s from the 1 month year?

Just a confirm. Client is non-gov, not for profit entity. Has 401(k) plan that the key ee maximizes by contributing the full 16K for 2004. Can they contribute another 13K in the 457(b)? I also assume no catch-up available in the (b)?

Thanks

Does a spouse have to be named as a beneficiary in a 457(b) governmental deferred compensation plan?

If a 401(k) plan is established via a collective bargaining agreement, is it necessary to do ADP/ACP testing?

If necessary to do the testing, what do you do if it fails? If the plan were a DB or DC plan you have the 415 limits, but you do not test discrimination under 401(a)(4) because the benefits are negotiated.

Are there any cites pro or con?

Not surprisingly, I am confused by the final regs and the exception for the 12-month rule for safe harbor plans in the year a plan terminates.

The plan makes the 3% not the match.

The regs say the plan will not fail to satisfy the requirements for safe harbor if it satisfies the requirements through the date of termination and EITHER 1) treats any suspension of safe harbor matching as a reduction or cessation subject to a 30 day notice requirement or 2) the termination is because of business hardship or transation described in 410(b)(6)©- probably a merger or acquisition.

Can anyone determine what this means for plans that make the 3%. Neither of these would apply if there is no match made. So, either it means 3% plans automatically satisfy 1 or satisfy neither and therefore must provide the 3% for the entire year or lose safe harbor status if it termintes mid-year.

Help!

Thanks