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?

I was contacted by an individual, one man show, took a loan from the plan, only made an annual payment (principle and interest). I know the rules... at least quartely payments and if a payment is missed it is allowed to be made up as long as it is done before the next quarter.

My question... are there any exceptions to the rule... can he make annual payments? Semi-annual?

He is looking at a deemed dist... trying to help him out...

I am 27 years old and invested in a 401k plan at work, do I need an IRA or am I okay with a 401k for retirement needs?

I am 27 years old and invested in a 401k plan at work, do I need an IRA or am I okay with a 401k for retirement needs?

Suppose the accrued benefit in a 412(i) plan is defined as a unit benefit accrual (for example 2% of HC3 multiplied by years of plan participation payable at NRA) instead of the cash surrender values as allowed in 411(b)(1)(F).

The plan is going to terminate and assets will be far below the amount necessary to provide the accrued benefits (lets assume lump sums will be paid).

At this point I figure the plan has two options, but I am looking for a third.

1. Pay the entire accrued benefit to the rank-and-file and short the HCE,

2. Ask for blessing from the IRS to pay the accrued benefit to the extent funded to each participant, rank-and-file and HCE alike as mentioned in 411(d)(3).

Does anyone out there think that one may be able to take a deduction up to unfunded current liability as allowed under 404(a)(1)(D). The problem as I see it is that because section 412 does not apply to a 412(i) plan that one does not calculate current liability for a 412(i) plan (is everyone else out there just as tired of 412(i) plans as I am?)

Any other suggestions regarding how the plan sponsor could make a large deductible contribution when the 412(i) plan terminates?

An ESOP owns 100% of the corporate stock currently outstanding. There is a group of corporate officers who own options to buy stock in the future.

I realize that none of the stock allocated to participants is attributable to them for purposes of determining ownership. But is the stock owned by the ESOP included in the denominator in determining ownership percentages?

For example if an ESOP owns 100,000 shares of stock, and Employee Joe has an option to purchase 5,000 shares of stock outside of the plan, how is Joe's ownership percentage in the corporation computed for determining whether he is a > 5% owner?

Is it 5,000/100,000+5,000 = 4.76%

or is it

5,000/5,000 = 100%

Thanks for whatever insight you can provide. Again, I understand that none of the shares in the ESOP are attributable to Joe, therefore they clearly are not to be included in the numerator of the ownership fraction. What I am concerned with is whether the ESOP shares are to be used in the denominator of the fraction.

Once upon a time, the IRS took the position that if the investment of a term vested participant's account balance was more restrictive than that availbale to an active participant, the consent given by the terminated participant to receive his distribution was invalid since the disparity in treatment (i.e., pooled funds vs fixed income money market) resulted in the participant being coerced to take a distribution.

I cannot remember the citation ofr this position. ANy help?

401(k) Plan with safe harbor match. Eligibility is 1 YOS, 12 months, over 1000 hours, age 21. Dual entry dates (Jan 1 & July 1). The owner's son completed over 1000 hours in calendar 2002, turned 21 in March, 2004. He worked 509 hrs. in calendar 2003 and 526 hrs. in calendar 2004. My question is, does that completed YOS over 1000 hours from 2002 stay with him until he reaches age 21 since he didn't have breaks-in-svc in '03 and '04 (over 500 hours each)? This seems like it should be a basic thing, but I'm not getting a grasp on it this busy Monday...........thanks in advance for all thoughts.

Plan effective 10/1/2000 and had a short year 10/1/2000-12/31/2000. The valuation date was 10/1/2000.

The second plan year was calendar 2001. The valuation date used was 1/1/2001 and the Schedule B reported a change in valuation date/funding method subject to automatic approval under RP 2000-40.

Now the plan year has again changed to a 4/1-3/31 year causing a plan year of 4/1/2004-3/31/2005, thus making a valuation date of 4/1 desirable.

Is this a change in valuation date/funding method? Do we have to file for approval since the 4 year period has not passed?

Note that at no time was a change from a date other than the first day of the plan year used, so no change was made to the first day of a plan year.

Help please. Thanks.

Profit Sharing Plan has a 2 year waiting period....if the plan is top heavy does an ineligible participant become eligible in the first year???