Plan is in Ohio which has banned common law marriage

since roughly 1991. A participant dies and his "spouse"

seeks a survivor annuity. Unfortunately, she is unable

to produce a marriage certificate or other proof they

were married. Absent this proof, she is not the person

who will be receiving a benefit from the plan.

How is this best handled? Do we give her a deadline

to produce some proof? Do we file a declaratory

judgment action and let the court decide who to pay?

It would seem the ball is in her court to go to

the county where the marriage allegedly took place

and seek the proof the plan needs. However, we

do not want to end up paying the benefit twice.

Input is appreciated.

Due to a downturn in business a company has ceased making contributions of employer contributions to its stock bonus plan. The value of the stock has decreased to less than 10% of the value of the fund. The employer wants to amend the plan to offer actively employed participants who are non-officers of the company the right to sell the shares of employer stock in their accounts to the company at its fair market value (a full valuation has been done recently). Can this be accomplished without violating ERISA's prohibited transaction rules?

Wonder if anyone out there could offer me some good strong advice.....

I'm 50 yrs.old and want to start a Roth IRA and was wondering where to start one. I contribute $1200 per year to a flexible premium deferred annuity which is guaranteed at 3%. I know I should be more aggressive beings I have at least 10 more years to contribute. I want to contribute the maximum allowed. My husband is receiving retirement from the military and has a 401K at his current job. This would be a spousal Roth IRA and I want the best possible investment for the amount of time I have. Any suggestions would be grealy appreciated.

Kathy

PS Plan with last day accrual requirement.

Can I change plan now (in November 2004 but pre-12/31/04) to change the definition of compensation to be period of participation rather than full year (not for TH, just for any additional).

I think there is no accrual of anything until 12/31 so it si ok. But I am getting an argument...

Thanks

Earl

At the end of 2001, a participant was involuntary terminated as part of the plan's partial termination. He became 100% vested.

He was rehired 7 months later. Are his 2002 and 2003 employer contributions also 100% vested or does the regular vesting schedule apply to those monies?

Participant terminated 11/22/04. Turned 70 1/2 on 8/22/02. 1st MRD due 4/1/05.

Can it be done now?

I have a dental practice where one of the dentists has been a 1099 employee for the past few years. On October 1, 2004, this dentist was switched to a W-2 employee.

They have a calendar year SH PS 401k plan with a one year eligibility. Semi-annual entry dates.

Do I treat this dentist as if she were hired by the company on 10/1/04 or can I count her years of service as a 1099 employee?

Thanks.

The document allows for the plan to pay "reasonable administrative expenses" from the plan. The employer contributes shares each year. They would like to deduct the share valuation fee from the ESOP's portion of the annual dividend (actually the s-corp "distribution") prior to allocating the dividend to participants. The ESOP is a minority owner of the company. Is it appropriate for the participant's to pay this expense? The client says that they have no other use for this valuation, it is only done for purposes of the ESOP. I appreciate your thoughts.

I have a situation where an employer has a profit sharing plan for salaried employees only and a separate 401(k) plan for everyone. The allocation formlua is compensation to total compensation. Assume they can pass 410(b).

1. Is this a design based safe harbor or do they have to run the general test?

2. If it is the general test, I am assuming they will have to include all employees regardless of whether or not they are salaried. Correct?

3. If the plan is top heavy, do all employees get the top heavy minimum?

4. Would you answer to 3 above be different if the 401(k) plan was not in existence?

Any cites would be appreciated.

Thanks

The sole owner of a small business is the only participant to make any contributions this year (2004) to the Simple IRA plan.

The company would like to fund a profit sharing plan rather than continue the Simple.

If they start the profit sharing plan for 2004 can the amount contributed to the simple be distributed as a return of excess contributions, since the exclusivity rules will be violated? If the distribution is done before the tax return is due is there still a penalty?

Would the prior year contributions be effected? Is this even possible?

Thanks!

When paying out non-spousal beneficiaries, is a code of "4" always used on the 1099-R? (401(k)/profit sharing plan)

I know that when a lump sum payment is issued, code "4" is used, but I am unsure how to code the 1099-R when the non-spousal elects the life expectancy option. I would assume it should be the same code, but you know what assuming gets you.

It seems odd that you could have a 35 year old beneficiary receiving payments for 35+ years coded as a death distribution.

How are you dealing with a startup company in which everyone employed by the company is making over $90,000? There is no lookback data to determine if they are highly compensated. Should I just use the same rationale as a person that is hired during the year and is highly compensated? That would mean that all of the non owner employees are non highly compensated for the first year.

I've talked to a colleague that said the 2 companies he has worked for in the past has used curent compensation for the first year of a company's existence. He did say he didn't know if that was right or not, but it's what they did.

I was talking to my Fidelity representative about SEP IRAs, SIMPLE IRAs, and self-employed 401(k)s, and he mentioned that there would be a new kind of retirement plan coming into effect in 2006 that will be much to my (and others') benefit: the Roth 401(k).

I've done some searching on the internet, and have found some useful websites, most notably Roth401k.com, which is a sister site of LifeTimeSavingsAccount.com, which is a sister site of RothIRA.com. I'd suggest everyone check it out. It will be a very beneficial plan.

It appears that essentially what will happen is it will be possible for employees to contribute after-tax dollars to a Roth 401(k), which would grow tax-free (instead of tax-deferred, where you pay at the income-tax rate upon withdrawal in retirement). However, employer's won't have to allow their employees to contribute to a Roth 401(K), so talk to your employer's about it, and those you work with. The university I work for hasn't even implemented Health Savings Accounts yet.

Any thoughts, articles, or comments are appreciated.

Our CPA firm does plan administration on DC plans only. We have been asked by a tax client about setting up a DB plan.

Can anyone recommend a good DB consulting/actuarial firm in Indiana? The only one I am familiar with is McCready & Keene, which I believe is very good. Any other suggestions? Thanks.

we are a large self-funded ERISA-exempt health plan. we've read about the results some large employers and government entities have had with full scale dependent eligibility audits. and we have questions.

1) does anyone know what action those employers took when the employee failed to submit the requested documentation of their dependent's eligibility? (essentially ignoring the request as opposed to responding that the dependent cannot be documented.)

2) do employees who enroll ineligible dependents and who don't take advantage of amnesty periods lose the right to continue any and all coverage under the plan when the employer becomes aware?

3) does anyone know what action employers take when the employee terminates employment before the dependent benefits have been fully recouped?

4) how do fully-insured plans react to the discovery of ineligible dependents?

5) are there other legal processes or penalties are imposed?

thanks in advance for your input!!

Can a welfare plan borrow money from a pension plan?

This is probably too easy, but for payroll purposes, when an individual makes a 401(k) contribution, is that 401(k) amount subject to FICA? Does it make a difference if the 401(k) amount is made from a company bonus as opposed to regular payroll?

For a safe harbor hardship withdrawal format, is “proof of need” required (eg: eviction notice, college bill) or merely advisable? The plan document doesn’t specify.

Is the election to use the Top Paid group an administrative election or does it have to be in the plan document.

I use the PPD/Corbel doc and the appendix A asks for an election. Would it take a plan amendment to change that for a future year.

And, what would be the timing on that amendment (I fugure that would be like the timing on a current to prior change - open to discussion).

Thank you.

I have a top heavy plan that passes gateway using "smoothly increasing" bands. The allocation rates range from 21% of comp down to 3%. The plan fails the average benefits percentage test to the point that the lower allocation groups need to be increased to the 8% range. I also have a few active participants that have not met the hours requirement for the 8% allocation, but must receive a 3% top heavy allocation. My question is if i have to increase the allocation rate for some of the bands to 8% does that prevent the plan from using the "smoothly increasing" method to pass the gateway?? Must i then give 5% to the Top Heavy only participants?? Thanks.