If I aggregate a DB and DC plan for 410(b) & 401(a)(4) testing, what benefits, rights and features must be common to both plans ? I believe distribution options would need to be the same (e.g., lump sum, J&S) but would vesting schedules have to be the same ? any other categories I need to be concerned about ? Thanks for any thoughts.

I'm a relative newbie to this message board, and I'm always impressed by everyone's knowledge and the very advanced level of discussion.

What's your background? Are you a TPA or actuary? Or, do you work in some other field that crosses over with the issues discussed here?

I'd like to pose a question to the 403(b) plan practitioners:

When 403(b) plan deferrals are matched to a 401(a) qualified plan, what are the mechanics of the ACP test?

There's clear, substantial authority concerning ACP testing of matching contributions made to a 403(b) plan (i.e. when the plan receives both the employee salary reductions and the employer match). But, I haven't found an answer for 403(b) plans and QPs that work in tandem. Do you treat the matching contributions as if they'd been made to the 403(b) plan (rather than to the QP) and perform the test accordingly?

If you have a Profit Sharing/401(k) plan with an annuity requirement, and a participant would like to use his account balance to purchase an annuity,how do you code the 1099-R showing the funds are being distributed from the retirement plan? Or do you even need to issue a 1099-R?

Daughter is hourly employee at a large (100 plus employees) sec 501©(3) exempt private foundation in Calif. Daughter injured in car crash, is temporarily disabled and is receiving Calif state disability benefits. Employer is making up difference between disability benefits and regular pay and is charging against her accrued sick leave. The makeup pay is equivalent to about 4 hours of pay per day, but she is being charged a full day against her sick leave.

Daughter's question to me - can they do that? My response - first we have to detremine whether foundation ee h&w benefits subject to ERISA or state law.

My question to you - is an exempt private foundation subject to ERISA? If so, is a sick pay plan required to have a plan document? And should the disability supplemental pay plan have a plan document?

Employee handbook contains vague statement about sick pay and nothing re disability makeup.

Employer is somewhat defensive when daughter tries to get info as to what defines her entitlements (and they admit this is the first time they have dealt with this type of situation). Will appreciate any comments.

Having a tough time trying to figure out if my thinking is correct.

If a cross-tested PS plan is established 9/1/04 with a short first plan year ending 12/31/2204, I realize I will need to prorate the compensation limit to $68,333.

If the plan will be top heavy for the first plan year, can I give Non-Key EES 3% of compensation from 9/1/04-12/31/04 or do I have to use full year pay to meet the top heavy reqs. HCEs will only get 9% of $68,333 or $6,150 so I think this will meet the gateway minimum as long as the top heavy contribution based on short year pay is correct.

Any guidance would be greatly appreciated.

Thanks

At first I thought this was an easy "no" answer, but the more I looked the more I questioned it.... Does USERRA apply to ALL military service? ie: hired in 1960 drafted in 1965, discharged and returned to work in 1967 and worked straight through to 2004.

Does USERRA, or anything else, require the Plan to credit service for 65-67?

This is kind of an odd question and my gut tells me that it cannot be done.

Can a plan be conditionally adopted? For example, suppose an employer adopts a plan on 7/1 on the condition that a certain event takes place on 9/1? If the event takes place on 9/1, the plan's initial effective date would be 7/1. Would this be any different than contributions being conditioned on their deductibility? References to any guidance would be appreciated.

Is there any problems with payments continuing to the estate of an alternate payee when a QDRO awards the AP a portion of each payment until the participant's death? My concern is that only natural persons can be alternate payees (414(p)(8)). Must payments end on AP's death or may the continue to a designated beneficiary, such as a dependent child? Thanks.

We have various subsets of employees. We have one particular subset that we would like to provide lesser health benefits to. If we completely exclude this group of employees, we will pass the coverage tests. It just doesn't seem right that we can exclude them altogether without running afoul of the nondiscrimination requirements, but that we cannot simply provide them with lesser benefits. Could we incorporate a subplan in our plan specifically for these select few employees? Any structuring ideas and/or suggestions (or if the answer is simply... Can't do) will be greatly appreciated.

Thanks in advance for any insight.

We have various subsets of employees. We have one particular subset that we would like to provide lesser health benefits to. If we completely exclude this group of employees, we will pass the coverage tests. It just doesn't seem right that we can exclude them altogether without running afoul of the nondiscrimination requirements, but that we cannot simply provide them with lesser benefits. Could we incorporate a subplan in our plan specifically for these select few employees? Any structuring ideas and/or suggestions (or if the answer is simply... Can't do) will be greatly appreciated.

Thanks in advance for any insight.

Can anyone point me to Section 89 of the US Department of Labor Relations? Apparently there is a required participant notice under this section related to participant directed investments for all employee benefit plans. Is this nothing more than ERISA 404© requirements? Thanks.

I recently opened a Roth IRA account. I know that if I take distribution, before 5 years and before I reach 59 and 1/2, I will have to pay taxes + penalty on earnings.

But if my roth account is more than 5 years old and I take distributions, then would I have to pay taxes and penalty still (before age 59 & 1/2)? I read somewhere that after 5 years, I will have to pay only taxes, but not the penalty.

I was looking for this info on IRS website, but couldn't find anything confirming or denying it.

Can you provide some info?

In a Money Purchase Plan, alternate payee (ex-spouse) is entitled to more than $5,000. Is her consent required before she can be paid? Thanks for all input!

Does family attribution apply in a partnership? One partner is a more than 5% owner in the partnership. His son is an employee and a participant in the 401(k). Would the son also be considered a Key Employee? Thank you.

Is it possible to have a one person 401(k) plan that is not a simple plan? I had a financial advisor mention that today, and I've never heard of such thing...can anyone give me some imput or tell me where to look.

Thanks

Hi,

I am new to the SARSEP world, so this may be a very simple question.

ER has been making a 6% contribution to all employees but not capping compensation when determining the 6%.

Is this okay?

Help

I have an employee who will be sending his child to preschool about 3 days a week. He will have to pay for these days. Can this be run through the dependent care component of a cafeteria plan or not??

I have always thought that one could not rollover any portion of a 401-k account while still actively employed by the sponsoring employer; nor make withdrawals at all except for hardship or loans. If an employer makes special one-time contributions (profit sharing) to a 401-k are they permitted to allow you to withdraw and/or rollover this amount? If you can withdraw or roll it over, what are the rules for penalty and withholding?

A one-participant plan's one participant (owner) wants to buy a home using pension assets. I am not sure if for the down payment only or to make the entire purchase. Then the owner wants to have the home leased with rent payments going into the plan.

I believe the plan can invest in the home, but I am not sure they can do so if they are to live in the home as primary residence (although I see nothing prohibiting such).

However, I don't believe the rental payments can go the plan unless it is used strictly to meet the plan's funding requirements.

Anyone have any thoughts or experience on this sort of thing?

Thank you.