I owned PSI stock in my IRA. The company went bankrupt, a class action suit was filed, and I received a check for around $100 from the settlement. There is a 1099-DIV included that says it was a non-taxable distribution. However, since this amounts to a witdrawal from the IRA, should I report this as income on my tax return? Where does it get reported so that it does not confuse the IRS computers? Or is it non-taxable? I am over 59.5 so there is no penalty.

Dick

Hi, I will make this quick.

an employee has been required by the doctor to go from 5 day work weeks to 3 day work weeks because of health issues.

the employee emails her supervisor and explains some details of her condition and how she can manage her position working 3 days a week.

The supervisor forwards the email to his "girlfriend" that works at a completely different company and just puts in the forward "FYI".

Can this be ok to do?

Thanks

saaben

Get one of these: http://www.irs.gov/pub/irs-pdf/p590.pdf

1-800-TAX-FORM.

See page 58.

A participant is receiving a distribution under a SERP upon termination of employment. The distribution will be in a lump sum. The wages will be reported on a Form W-2 - At what rate should taxes be withheld? The individual's regular tax rate or can the participant specify what rate he or she wants. Thoughts?

I have a 401(k) from a previous employer (a little over $31,000) that I would like to roll over to a Roth IRA. If I understand correctly, I'll need to roll the 401(k) to a traditional IRA, then roll that to a Roth IRA and take the tax hit.

Can someone confirm this for me?

Also, can I roll a portion of the traditional IRA (say 50%) in 2004 and the rest in 2005 to reduce this year's tax hit?

Also, I would like to know where to invest this money. I'm looking for the most aggressive investment for my Roth IRA that I can find. My goal is to earn as much as possible in the Roth IRA, since I won't be paying taxes on the gains. Also, I can be a little less aggressive in my 401(k) with my current employer to balance my risk. And, since I'm 31 1/2, I have 28 years to go to reach the magical age of 59 1/2!

Any suggestions would be appreciated.

Thank you!

I'm an estate planner advising a client in connection with her closely held business. Acutally business now owned by her four sons. She is the sole employee and wants business to adopt medical expense reimbursement plan. It's tax motivated, the business deducts the expense, not included in employee income. For individuals medical expense deductions are subject to numerous limitations. And reimbursement plan will reimburse for expenses that typical health plans will not cover (OTC drugs etc.)

Anyway, even though there is only one employee is this an employee benefit plan covered by ERISA? if yes what requirements does ERISA impose? Need to give client an SPD? Filings with the DOL? I'm out of my element a little here and want to make sure I'm not missing something big.

One other thing, the employee isn't contributing to the plan. I put the COBRA provisions in about extended coverage etc. is it ok if employee doenst pay any premiums during the extended periods?

Apologies if this has been asked and answered in prior posts, but I am wondering what experiences folks have had in negotiating with the DOL over corrections relating to the late remittance of elective deferrals. More specifically, how far back do you have to go to address this issue?

I am working with a small-ish company that carried over its payroll practices from a much larger company from which it spun off. Recently, the company got a love letter from DOL which led to an audit for PY2000. The audit came up clean except for DOL's favorite topic--late remittance of deferrals.

Since the spin in 1999, the company has remitted deferrals once a month, but has a bi-weekly payroll. I knew there was an issue here right off the bat, and we fixed it from 2000 forward. Now, DOL is trying to hold us up for 1999 too. I would like to tell them to go jump in the lake, but I didn't know whether they take the same sort of position the IRS does on corrections: once you/we find a problem, you have to fix all the way back, even if it's outside the statute of limitations.

We're talking about small dollars here so we may just hold our noses and pay up. Of course, if we have a decent basis for telling them to buzz off, I'd like to do so.

Anyone?

If a person that has reached age 70 1/2, has an IRA that includes after tax money, are they required to take a minimum distribution on the after tax portion of the account?

Does anyone know of a good resource regarding life insurance in db. Specifically, regarding funding technique, Thoretical ILP calculation under 74-307 AND most importantly, distribution options at plan termination and how to handle them.

Also, I use blaze valuation system. Seems to be good for plans with LI. Any thoughts? How is SMART. thnx

Is it possible to have a controlled group or affiliated service group involving not-for-profit organizations? Specifically, we have a client who is a labor union that established a 401k plan solely for its nonunion employees. One of the employees is paid by a separate entity named The Welfare Fund. Can we add the Welfare Fund to our prototype document as a participating employer?

It seems that everyone thinks that this is sanctioned by both the IRS and DOL. My question is in what guidance did the IRS sanction it? I've been referred to Rev.Rul. 2004-10, but that addresses administrative fees charged to termed participants and not to actively employed. Are people simply using this as a basis to say the other is o.k. too?

Client just had a much-needed turnover in HR Department and the new director has discovered numerous Welfare Plan Form 5500 delinquencies, and numerous missing Form 5500 records. It's very hard to tell what plans have neen filed and for what years. We are looking at 2-4 plans.

QUESTION: Is it a good idea to contact the DOL to determine which plans have filed and for what years? Has anyone had experience with this? My inclination is to just assume that if we can't find it, it wasn't filed, and use the DFVCP $4,000 per plan cap instead of mucking things up with the IRS/DOL. I would want to include a cover letter explaining that we have refiled everything due to the defincient recordkeeping of prior HR personell.

Any thoughts? Good idea, bad idea, other idea?

The president signed it this morning.

As a law student trying to write a neutral paper on the theoretical goals and financial implications each presidential candidate's healthcare plan, I am having substantial problems dissecting the numerous analyses I've read.

Ideally, I would like to see if it is possible to find the most compelling aspects of each plan, and construct a broad overview strategy that seeks to combine the best tools with optimum goals. How can I start this admittedly ambitious task when the numbers derived among all of my research just don't agree?

I have to present to the Board a suggestion on how our plans should handle the new involuntary cash out rules. Does anyone have any sites that give pros and cons of amending the plan to only cash out if under $1,000 or the benefit of cashing out under $5,000 to IRA. Am looking for different points of views.

thanks in advance

A company has a Prevailing Wage plan. They had an employee who received a contribution within his first week of employment. We had not been informed that he had been hired. We received the money and set up an account and a time to meet with him to fill out necessary paperwork. He quit the company the next day. The day after that he died. We have no paperwork and therefore no beneficiary sheet. He was not married. 100% vesting on entry into the plan. Account is worth a little over $25. What do we do with the money? Thanks!

I was just informed that my client cannot afford to pay their Safe Harbor Contribution for the 2003 plan year....all valuations, statements and tax returns have already been completed and filed.

Can anyone advise me as to what their options may be? I am assuming they have to make the 2003 contributions regardless, and then I would just have them amend the plan to make discretionary contributions only from this point forward...any ideas?????

Can anyone comment on allowing a participant to choose to have their loan deemed? Or, allowing them to choose the tax year it is deemed?

I know there are alot of issues around this, I am trying to compose a comprehensive list.

1. Not following the terms of the loan policy (which most likely will require payroll deduction)

2. Could be viewed as an in-service by the IRS?

3. Deemed loan is still an outstanding loan, and Plan Sponsor has the duty to try to collect on the loan (any cites for this would be helpful)

Also, if you could point me toward an prior posts on this topic. I have tried the search feature and come up empty handed.

Thanks!

Need help. We have a client that was a participant in a 403(b) annuity. She is now deceased. She had already begun receiving minimum distributions. Her two children are named beneficiaries.

After reviewing the regs, it appears that you treat the 403(b) the same as an IRA for RMD purposes and that the beneficiaries can roll the proceeds into a 403(b) or IRA in their name f/b/o deceased participant. The beneficiary would continue taking minimum distributions based on their own life expectancies. Is this correct?

The insurance company maintaining the 403(b) has indicated that the proceeds may not be rolled over. They have indicated the funds must stay with them, but can be paid out to the beneficiaries based on their life expectance.

Is it true that the beneficiaries can not transfer or roll the 403(b) to another vendor? Perhaps I am missing something.

Thank you.