Can deemed IRA contributions be invested in an unregistered group annuity contract sold exclusively to 401(k) plans? Is there any source that provides either way?

5 lawyers from the old firm started a new 401k the same day they left the larger law firm. The new law firm will be in the same location and building they always worked in. The same staff they used will also follow them. So nothing changed other then the name on their paychecks.

With all that I have read about the repeal of the same desk rule and the wording of separation and/or serverance... my question is...

Do the employees have the option to take their money and NOT be forced to transfer into the new plan?

Is the answer to the above found in what the old plan selected in their EGTRRA agreement?

Any help would greatly be appreciated.

Existing age weighted plan... wants to allow deferrals. Since all the EEs are 100% vested already, would the age weighted contribution count as the 3% SH to pass SH requirements? or would an additional 3% need to be added in addition to the age weighted allocation?

Facts: 401(k) Plan with $10MM in assets. HCE's have very large balances. Employer pays all asset based investment expenses of the plan.

Is this discriminatory? Effectively, the HCE's get a larger "contribution" from the employer?

I'm pretty sure that I read somewhere that this would cause problems (at least it would necessitate general nondiscrim testing).

Any sites/articles/regs etc. would be helpful.

Thanks,

Our plan document does not currently allow RASDs, but would like to amend the plan to do so. Does anyone know when an amendment must be made? I'm thinking it should be by the end of the year, but I couldn't find anything in the regulations.

The lone shareholder of a corporation works an average of 25 hours a week at his corporation, tending to the business affairs of the corporation. He has never taken a salary from the corporation (he receives no W-2). The corp has two regular full-time employees (one bookkeeper and one delivery man). They are paid a salary and each receives a W-2.

Can the corp establish a fully-insured medical plan that reimburses medical insurance premiums paid just by the shareholder (for the shareholder)?

IRC 106(a) says that "gross income of employee does not include employer provided coverage under a health plan" ...... BUT IRC 106(a) does not define the word "employee"?

Does employee mean only a worker that gets paid ?

Where can I find the IRC definition of "employee" as it relates to 106(a) ?

What are the consequences an Employer may face if forfeitures are not allocated according to the terms elected in the Adoption Agreement? What are the responsibilities of the trustee to ensure that forfeitures are utilized accordingly?

Thanks in advance for the help!

an accounting client of my firm came to us to help solve a dilemma. Their current service provider updated their document for GUST. In doing so and with discussions with clients management, they changed the allocation formula from a cross-tested comparability plan to an integrated one. Not sure why it was done, the client mumbled something about divorce proceedings with owner. Anyways...plan year is over and it's time to calculate the contribution amount. However, they want to use the comparability test to do so.....

Since it's after the end of the year are we locked into the integrated formula? or can we file a VCP filing and provide documentation that it was intended to be a cross tested comparability plan. Client would be actually increasing the amount provided to participants under comparability plan.

If we can change it, any ideas on the best way to do so?

Other than to address state community property laws, is there any reason why spousal consent should be required upon exercise of an ISO? What bout an nonqualified SO? I can think of anything.

Other than to address state community property laws, is there any reason why spousal consent should be required upon exercise of an ISO? What bout an nonqualified SO? I can think of anything.

Here's the situation - there are 2 DB plans within a controlled group - Plan A an underfunded salaried plan and Plan B an overfunded frozen plan with only term vested participants.

The employer purchased annuities for all of the term vesteds in Plan B and now wants to merge Plan B, which now has only the excess assets after the purchase, into Plan A - these excess assets will now be available for the participants of Plan A.

My contention is that under the exclusive benefit rule all assets of Plan B have to be used for the participants of Plan B and what they should do is merge first and then pay out benefits by way of , for example, a plan termination.

Does anyone agree ?

A participant receives a loan from from his 401(k) Plan 2001.

The loan re-payments were to commence for 120 pay periods (5 years).

However, the Plan has not deducted the repayment amount from the individual's payroll until 2 years after the loan re-payments were to commence.

In this case, should the Plan receive the total repayment amount and interest amount for the period from the participant?

Should the Plan receive the only repayment amount for the period from the participant?

Or is there another alternative?

1st question: When notifying a participant of his need to take a Required Minimum (RMD), are you required to send them a tax notice? For example, if you notify the participant in October that an RMD is needed by 12/31 and you give him an election form, are you required to also provide a tax notice? Since the RMD is inelgible for rollover, I wasn't sure if the tax notice requirement applied.

2nd question: Can a participant who is married and elected to use a single life factor, chose to use a joint life expectancy factor after a few annual payments have been made? If so, can the participant just elect a change, or must he have had a maritial status change?

Thanks

Can anyone help with the basics on holding FSA money?

Trust/fiduciary/audit are the three questions:

I understand that it is not reuired to be held in trust.

Is it subject to fiduciary requirements to earn interest?

Are the funds required to be audited.

Can they be kept in an account in the plan's name if it is not a trust account or does the account need to be legally titled in the employer's name?

I find conflicting numbers in different sources. Anyone know the exact number off-hand? Tx.

Mark.

With the repeal of 415(e), is it still necessary for an employer adopting a "prototype" SEP IRA, who once sponsored a now terminated DB plan covering the same employees, to file for a determination letter?

Thank you in adavance for any assistance!

If a participant continues to receive compensation while on military leave, can the participant continue to elect deferrals to teh 401(k) plan during such time? I was told that the compensation while on military leave is taxable on form 1099-R, so I am wondering what plan compensation could be used?

We have a client that is a group of companies in the medical field. One of the companies involved is 100% owned by the trust. When completing control group testing if one of the companies is owned by a trust:

1) How is this company treated? Is it part of the control group?

2) Is the trustee the owner of the trust?

As you can tell I am not real strong in this area, so please be gentle.

Thanks

My husband can not start contributing to his 401K until he has been with the company a year so we would like to start a Roth for him until then. Unfortunately we don't have a large lump sum to contribute to start. Are they any choices for people who do not have a lot to start with?

We are a TPA and as we are beginning to plan with our groups for their next renewal, we have several groups that will be implementing an HSA and running the contributions through a Section 125. My question is, currently we have groups with Section 125 plans that include PO,DC, and Medical Reimbursment accounts. When they add the HSA to their plan, the only MR account those employees participating in the HSA/HDHP can use would be one that only allows reimbursement for dental, vision and possibly some preventive care claims. Question is, can we have a Section 125 plan with PO, DC, HSA. a MR-1 for those participating in the HDHP/HSA and then an additional MR account for other employees who are not participating in the HSA/HDHP and want to continue to use their MR for all eligible medical expenses under Section 213? Can we have a different eligibility requirement for each of the MR plans and still cover it under one Section 125 design, or must we have two separate plans, one PO,DC, HSA, and MR(dental,vision, etc). and another Section 125 plan with PO, DC, and MR for alleligible expenses?

Any thoughts or opinions on this question would be appreciated...or if anyone thinks of any pitfalls with this theory or potential risks?