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.

We currently have a plan that utilizes the ADP Safe Harbor Matching Contribution (100% of 3% + 50% of Next 2%). The sponsor is considering implementing an additional enhanced matching contribution. They want to have the option of making this contributiion dependent on the year the company has. And they want it to automatically pass the ACP test.

We had the idea that we would state in the notice that the employer will make the ADP Safe Harbor Match and that they MAY make an additional Enhanced Matching Contribution that will increase the second portion of the ADP Matching Contribution from the required 50% up to a maximum of 100% on the "Next 2%". This percentage will be determined based on the amount of the additional matching contribution the employer can afford to make.

Is this an option for the plan and would this additional "Enhanced" matching contribution fall under the ACP Safe Harbor Enhanced Matching options and thus automatically pass the ACP Test for the year.

Wow is that tough to explain in words.

Thanks

Participant has a hardship which is not included in the safe harbor rules, i.e. downpayment on a franchise. Participant is separating from service and could take total distribution, but the timing of the ability to take the distribution could put an extreme hardship on the family -- i.e. no income until downpayment can be made. Participant has other expenses which do qualify (education expenses for wife). Does it matter where the exact dollars go? I mean all expenses are paid from family resources, so a shortage of one kind effects the ability to pay other expenses.

Wife does get a student loan that could cover just tuition and books for the next semester (not all of the estimated cost of attendance bythe school, room and board, etc.), but the regulation seems to state that education expenses due over the next 12 months qualify.

So, I am trying to figure out what if any safe harbor withdrawal can be made.

Thank you!

Stephanie

Roger Clemens helped the American League get home field advantage (via the All Star Game appearence) for the World Series. Maybe he is still a Red Sox at heart.

Yankees payroll since 2000 : 630 million

# of world series won : 0

I am setting up a transportation fringe program so my employees can pay for their bus passes with pre-tax dollars. We will sell the items to employees at a 7% discount (giving them back most of our FICA savings), so we are essentially just breaking even (excluding the cost of my time to administer, which won't be much, we're only talking about a handful of employees.)

I looked over a lot of the old discussions, and I do not want to set this up like a section 125. I just want to deal with it each month, when they need a pass or voucher, they sign an authorization for it and I give it to them.

In one of my localities, I can get passes on consignment, so then we would just deduct the discounted amount pretax and then we pay for the pass.

In another localitiy, we have to buy vouchers, which the employee would use to buy their pass. Again we would just deduct the discounted amount pretax. We already paid for the vouchers, so this would pay us back for what we already put out.

I think both of those situations are correct, but of course would love to hear if you see a problem with it.

Now I have another locality where I do not think I can get passes or vouchers. So I am trying to wrap my head around how to deal with that so that it would equate with the others. If the pass is $28, then it seems like I would need to reimburse the employee the entire $28, which would be nontaxable, since its an excludable fringe, and then the employee would pay us back the discounted amount pretax. But that seems like double dipping somehow. Does that sound right, or is that an allowable way to deal with it? I think I am thinking about this too much...

Thank you for any thoughts on this.

Is there any information out there (a study, etc.) regarding nonprofit industry standards for employer matching of 403b plans?

we are a nonprofit with approx 25 employees with a $4.0 million budget, looking to redesign our plans.

well, leaving this weekend. hey, if you are going stop by booth -#513 - my company has a booth this year. always nice to put a name with a face, plus I'm 'suckered' into giving a talk at one of the sessions on safe harbor and new comparability. hopefully I can make the talk as lively as some in the past - at least one 'pension' song.