Catch Up Contribution rules come in two flavors:

- 414(v) for salary deferral plans (including SAR-SEPs, and SIMPLE IRAs.)

- 219(b)(5)(B) for Traditional and Roth IRAs.

Both Sections have the Catch up dollar limits set to fixed levels through 2006.

After 2006, though, it seems that 414(v) limits are subject to Cost of Living Adjustments whereas the 219 limits are not.

Can anyone confirm this?

Announcement 2004-2 and the W-2 Instructions indicate that employer contributions to an HSA must be reported in Box 12 with code W. Does "employer contribution" include pre-tax employee deferrals to an HSA under a Section 125 cafeteria plan as well as direct employer contributions to the HSA? Cites appreciated.

Is it permissable for a db plan to charge a participant the cost of calculating a benefit certification? if so, and the ppt takes a lump sum, can the plan reduce the lump sum amount by the cost of the calculation? any references to regs, etc. would be greatly appreciated...even if the answer is nope.

What employer contributions can be used to satisfy TH minimum?

I know non-elective contributions and QNECs can be, but can QMACs?

One Trustee's company of a Taft-Hartley Plan is delinquent to the fund to the tune of millions. This has been going on for several years and was just brought to the attention of the other trustees. The company may now be going bankrupt. The trustee is the sole owner. May we go after the trustee personally under the theory that he breached his fiduciary duty to the fund by not disclosing the delinquency? even if the company files bankruptcy? Any other ideas will be greatly appreciated!!

Thanks!

3% SHNEC to all people eligible for 401(k) plus a 2% regular profit sharing contribution, integrated with SS but at 70% of the TWB. The owner and sole HCE is the only employee over the TWB. He earns $115K, with the TWB at 87K (i.e., integration level is ~61K. For the latter formula, you must have worked 1,000 hours during the Plan year.

According to the ERISA Outline Book, if there are different allocation conditions for two independent design based safe harbor formulas, the design based safe harbor is not valid and rate group testing must be performed.

The ERISA Outline Book goes on to say that if the additional PS contribution passes coverage on its own, then the rate group test will be passed (i.e., there is just one rate group).

When I run the rate group test it fails. The reason being when permitted disparity is imputed to his allocation rate, it assumes the integration level is $87,000. Because the integration level in my example is at 70% it's as though the plan is "super integrated." This results in the owner having a higher allocation rate than everyone else. I already verified that if the integration level was 100% then then his allocation is the same as eveyone elses and the rate group does pass. Am I missing something? OR are the ERISA Outline Book, and Relius both wrong????

What am I missing??? Is there an adjustment to imputing disparity when the integration level is a fraction of the TWB?

how do i start an ira with roth and how much can i start out with?

I am preparing a 5500 for a large plan.

Is a Money Market Fund held at a mutual fund company considered interest bearing cash or is it reported as a mutual fund?

I have a self employed individual with employees and a SAR SEP PLan.

For purposes of computing his SEP contribution is his Schedule C compensation reduced by his elective deferrals and his catch up elective deferrals ? I know that is is reduced by the FICA tax deduction and his own contribution to the SEP portion of the plan.

So if he net Sch C after employee contributions is 100,000 and his FICA tax deduction is $9,000 and his salary deferrals/catch up are $16,000 what is his personal maximum SEP contribution??

THanks

Company wants to have insurance company administer loans (approve, pay, collect, etc.). This is an ERISA 403b with employer contributions that is administered by NY Life.

Is this a good idea? We would try to get a hold harmless agreement for tax errors and attempt to allocate fiduciary liability for loan processing under ERISA 405c.

Company wants to have insurance company administer loans (approve, pay, collect, etc.). This is an ERISA 403b with employer contributions that is administered by NY Life.

Is this a good idea? We would try to get a hold harmless agreement for tax errors and attempt to allocate fiduciary liability for loan processing under ERISA 405c.

One of the transactions available for correction under the VFC Program is for loans made at a fair market interest rate to a party in interest. Assume that a plan has made loans to a participant, but that the loans were not made in accordance with the plan document. That would be a qualification failure. However, it also appears that this loan would not qualify for the prohibited transaction exemption for participant loans because the loan was not made in accordance with the plan document. Please note that ERISA Section 408(b)(1)© states that, to be exempt, the participant loan "must be made in accordance with specific provisions regarding such loans set forth in the plan". As a result, it would appear that a participant loan not made in accordance with the provisions of the plan would be a prohibited transaction (since it does not satisfy the requirements to be exempt). Can you use the VFC Program to correct this prohibited transaction? Thanks for any help you can provide.

I have a PS plan that has MP assets in it since 2002 (an EGTRRA merge). We have been keeping track of all the assets separately, but recently the financial advisor made some transfers between the PS and MP assets, so now the MP assets accounts have some PS money in it. It is becomming a night mare trying to keep track of what is PS and what is MP with every buy and sell and dividend distribution. The assets are in a Schwab brokerge account.

If both plans were set up exactly the same: no hardship distributions, no in service distributions, annuity form of payment, same eligibility requirements, same vesting, etc. Why do we have to continue to keep assets separately?

Could we amend the plan to state the fact that the PS plan has retained all the requirements of the MP plan so therefore the assets will not be kept separately.

We could then have the financial advisor transfer all the MP assets into the PS account, and do away with the MP accounts.

Is there any guidance on this? Can anyone help me with this?

Thanks!

New beneficiary designations were rejected by a TPA as missing critical information, family law attorney sends the third corrected that OK. But, no confirmation was given that it was received.

Participant dies, of course, now TPA says they never received the third and final corrected copy. Attorney didn't send by registered mail, just has the 3rd copy in her files.

New beneficiary wants to avoid court battle. Anyone dealt with similar facts, have cites or white paper on the issue to suggest? Thanks.

With the passing of EGTRRA, it is now allowable to rollover pre-tax money from an IRA to a QP. It is also allowable to rollover pre-tax and after-tax from one QP to another QP.

Can a participant rollover after-tax funds from a QP to a "Condiut" IRA, and then from the "Conduit" IRA to another QP (assuming the QP accepts after tax)? Or, does the after-tax loose it's rollover ability once it hits the IRA?

Is it possible to design a cross-tested 401(k) safe harbor plan with the following:

Husband and wife

4 eligible NHCE

Offer the 3% non-elective to all participants including the Husband and Wife. Allow the Husband and wife to contribute max. 401(k) contribution (13k) each. Give the NHCE an additional 2% Profit sharing contibution, to satisfy the Gateway min. In order to pass cross-testing, can we eliminate the wife from receiving a Profit Sharing allocation. If so, does the 3% have to be used in the testing or does she not benefit for cross-testing purposes.

Any suggestion other than completely excluding her from the plan?

Company A had underfunded DB plan and is a member of a controlled group with Company B, which has no employees. Company B is not a signatory to the plan.

Most employees are shifted to Company B which is more financially viable and Company B is sold to Company C. Shaky Company A still has pension plan.

After 1 year Company A is insolvent and PBGC takes over pension plan. Can they claim assets of Company C?

Would the answer be different if the time frame were 6 months, 2 yeare, 5 years? In other words, if there is a lookback period, how long does it last?

A plan is top-heavy for the 2003 plan year. The employer needs to make a top-heavy minimum contribution to non-key employees for the 2003 plan year. The employer wants to know the latest date this top-heavy minimum contribution can be deposited. They don't care what year they take the deduction or how it applies to 415 - they just want to make it as late a possible.

What is the latest date an employer can make the top-heavy minimum deposit? I cannot not find this in the 416© or the regulations. Please help.

A 501©(3) organization which has a number of current employees would like to make 403(b) nonelective contributions only on behalf of its retired executive director for up to 5 years after retirement. The former executive director would not be considered highly compensated under 414(q), but was highly paid compared to other employees of the organization.) I don't think I need to worry about nondiscrimination; however, any thoughts as to whether I can take the position that this arangement is not subject to ERISA because it does not provide retirement income to "employees" (i.e., it covers only one individual who is not a current employee)?

If an employee passes away during a plan year....does a contribution in a Keough Plan still have to be made for this employee if he had worked most of the year?

Thanks!