Would anyone recommend this fund for a Roth IRA in comparison to another of this type? I understand it is a lower risk with a potential of high returns.

New TPA for 401(k) profit sharing plan discovers that the plan failed to make top heavy contributions for previous years. Sponsor is willing to correct now and in the future but does not want to (cannot afford to) file a voluntary corrrection with the IRS and pay the user fee and back contributions. Does the TPA have any liability for refusal or should it resign?

Is there a Statute of Limitations when it comes to the Trustee collecting overpayment of DB to participants?

Per Rev. Proc. 2004-22, prescription drug plans are "grandfathered" so they can be offered w/HSA plans through 2005.

How are insurers handling non-calendar-year prescription drug plans that would run 2005-2006 & HSAs?

Only thoughts I have are

1. make short plan years terminating on 12/31/05.

2. not offer them at all after the plan year ending in 2005.

3. let them be and tell those taking it that they won't be HSA eligible as of 1/1/06.

Anyone know what insurers are doing in practice or have other ideas?

Hi, I have someone asking me the following:

Do Voluntary Life/AD&D Programs need to have a 5500 filed?

It is an optional employee-paid benefit.

Can anyone help me?

Is there a Statute of Limitations when it comes to the Trustee collecting overpayment of DB to participants?

We have a client who wants to set up a plan (employer contributions only) effective as of the beginning of the year. We proposed standard eligibility requirements of 1 year of service and age 21 with an eligibility requirement waiver for anyone actively employed as of the effective date of the plan. The individual preparing the document says that we have a problem due to the "dual eligibility" provisions of 1.401(b)-6(b)(2). On pages 2.6 and 8.97 of the ERISA Outline Book, Sal Tripodi indicates that such waivers can potentially cause coverage problems, but does not provide a clear explanation as to how. I point out that such eligibility waivers are included in standardized prototype plans, which are supposedly designed to always pass coverage. Any ideas?

If an employer decides mid-year to pay the entire cost of a certain class of employees health insurance, can they? What if they call the 'reason' for the 100% contribution due to a promotion? To us there is no qualifying event to allow the change from a pre-tax deduction to no deduction at all, midyear. The other question is, could the employer set it up at the beginning of the year to pay 100% of a certain class?

Say a 40 year old, sole owner/participant of a corporation decides to implement a DBPP.

He can choose age 65 as normal ret and fund the 415 limits from age 40 to normal ret and then take his distribution.

However, what about another approach. Say, instead, the participant chooses age 55 as normal ret, funds the 415 limit and takes a distribution at age 55 and terminates the plan. Then the owner decides to implement another DBPP at age 55 with age 65 as normal ret. Now he gets to fund for yet another 415 benefit payable at age 65.

Does anyone have any thoughts or knowledge as to the feasibility and legality of such a strategy?

Thanks.

Gary

We have a 401k Plan with 3% Safe Harbor contribution plus an integrated profit sharing contribution.

How do we test for coverage? Relius shows 100% benefiting because some employees get the 3% Safe Harbor but not Profit Sharing because not there on last day, which is a requirement for PS cont alloc.

We are a TPA. The investment provider does the daily val. However, the investment provider has not been able to track loans. That is, their system was unable to split principal and interest and update loan balances as loan repayments were deposited. So, it has been up to us to reflect loan activity and balances on the year-end participant statements that we prepare.

Our loans fees charged to the participants were an initiation fee of $100 plus $30 per year prepaid maintenance fee based on the term of the loan. For example, a 5 year loan cost $250 deducted from the participant's account and no subsequent fees.

The investment provider is now able to track loans. Their fee includes an initiation fee plus a $3 per month maintenance fee charged monthly against the participant's account.

So, we have a problem. We'd like to transfer these loans onto their loan system, but we don't feel it's fair to have charged participants our maintenance fee and then turn around and charge an additional $3 per month fee.

One thought we've bounced around is simply reimbursing the participants our prepaid fee (or portion thereof based on remaining payments). However, our concern is the IRS might view the reimbursement as a contribution to the plan subject to 404 and 401a4.

Any thoughts or suggestions?

A new PS/k plan was adopted 9/1/04 effective 1/1/04 for 2 Drs. and 3 NHCE's. The 401(k) provision is effective 1/1/05. The plan is on a VS doc. As of last Friday the Drs. decided that they may want to remove the salary deferral feature from the plan (at least temporarily).

Any problems with that and, if not, what's the best way to handle it?

Realize if Bypass is properly setup and Custodian approves, an IRA can be funded by disclaimer to the Bypass. Several operational questions:

1. If the estate is such that the deceased individual really didn't have any IRA, but most of the estate is comprised of the surivivor's IRA, can the survivor transfer some of their IRA into Bypass to be able to fully fund? If that's allowable, would the RMD be based on the survivors life expectancy, or that of oldest beneficiary?

Does community property state versus separate property state laws have any impact?

2. Finally, if it is possible to do number 1 above, any problem with the survivor paying the taxes if she qualifies to convert some of her IRA into Roth, and then transferring the Roth to the Bypass to complete funding? Again, will the RMD be on her life expectancy or the beneficiaries? Does community property state versus separate property state laws have any impact?

Know this a lot to cover/answer, but I'm involved in a complicated settlement where the CPA is uncomfortable with the IRA and Bypass funding. This client has an estate of 4.5 million, and 3.4 million is the survivors IRA, and the house and other intangiables are 400K of the remaining 1.1 million.

I have a regular trading account with Scottrade and am thinking openning a Roth IRA account with them. Anyone who has a Roth IRA account with Scottrade can share his/her experience?

The new deferred compensation provisions under the Jobs Creation Act (Sec. 409A) except bonus or other deferred compensation that is paid out within 2 1/2 months into the year following the year the compensation was earned.

Does that mean that a perfomance bonus earned in 2005 that is completely paid out to the participant by March 15, 2006 is not subject to the requirement that the deferral election be in place on or before June 30, 2005??

I'm very confused on when catch-up are applied to an ADP failure. Can someone confirm logic below that Catch-up is applied as the last step before refunds:

Owner A age 45 $80,000 defers 5% or $4,000

Owner B age 51 $150,000 defers 5% or $7,500

Plan only support 3% HCE deferral, so $4,600 in refunds is required and split $550 to Employee A and $4,050 to employee B. Since B is catch-up eligible in 2004, he gets a $1,050 refund. Is this correct?

Does anyone know where I can find language that can be sent stating that they need to take a Minimum Required Distribution etc. Thanks

Seeking advice about vesting amendment from 100% immediate to 3 yr cliff.

Say this is done 12/1/2004 - calendar yr = plan year .... all computation periods = plan year where applicable. Yr of service = 1000hrs not elapsed time method. Would this suggest the following?

* All p/p's with 3 or more yrs of service through 2004 plan year end can elect to stay on the 100% vested immediate schedule for all contributions (applicable to the source the amended schedule applies) made through plan years up to and including 2004?

* Do new contributions for 2005 and future years of same source have to be recordkept under old schedule for only those that met the three yrs of service rule - OR could new schedule apply to new contributions irrespective of the grandfathered schedule for certain 3 yrs of service people applicable to those benefits accrued through adoption of vesting amendment?

Thoughts are appreciated.

Here are the facts. Husband and wife are married at the time of the husbands death. This is his second marriage. His will states that the new spouse should receive an amount equal to the elective share in NJ of his estate. The only real asset the husband had is an IRA. However, the IRA lists his children as the beneficiaries. The children were listed as the beneficiaries prior to his new marriage and the new spouse has no idea about the children being named.

Can augmenting the husbands estate make the spouse eligible for 1/3 of the IRA or do the prior benefit designation forms rule on this.

Any help would be great. Thanks in advance.

A pension plan rolled over too much money to an IRA and now wants the money back.

I believe the money has to be returned immediately since it was an ineligible rollover. I also believe that if it remains in the plan it is an excess contribution and must be removed.

Would appreciate learning your thoughts on this.