It's my understanding that there are two kinds of 403(b). The kind established & maintained by employer (this kind is an ERISA plan) .... and the kind not established/ maintained by employer (not an ERISA plan).

I'm not sure which of the two types I am dealing with (because I have not yet gathered all the info from employer to enable me to determine if they are ERISA 403(b) or personal 403(b) of employees.

Nevertheless, contribututions are made to these 403(b) through elective deferrals.

The employer and employees want to switch to a 401(k) plan.

The only assets of the 403(b) are mutual funds. No annuity contracts.

My questions:

1) If the 403(b) is an ERISA plan, can it be merged into the new 401(k) ?

2) If the 403(b) is not an ERISA plan, can each employee participant roll his 403(b) assets into the new 401(k)?

Don't know any details yet, not a plan we administer. But apparently a participant died, and the beneficiary of the plan is a trust. Don't know who the trust beneficiary(ies) is/are.

There was stock in the participant's account. Assume for the moment that it was NOT employer stock, and assume a non-spousal beneficiary.

The question was - if the stock is transferred directly to the trust, is there current taxation on the whole amount, the net unrealized appreciation, or nothing whatsoever until stock is sold?

I'd appreciate any thoughts on this. Thanks.

I took over a plan recently and the Form 5500 must be amended for 2002. It is a one man plan, so was eligible to use Form 5500-EZ for 2002 but did not. Can I amend using 5500-EZ?

When counting participants for purposes of applying the small welfare plan filing exception, does 29 CFR 2510.3-3(d) allow you to exclude eligible employees who are not "COVERED" meaning those who: (1) have not met the plan definition of "participant," and (2) are not subject to the occurrence of the contingency for which the benefit is provided--I'm not sure what this means--I assume it means the employee applying for the benefit/requesting reimbursement, etc.; and (3) never make a plan contribution.

I have been appointed by my company to create a disaster recovery plan/business continuity plan. Has anyone had any experience with this? Any recommendations or pieces that you could share?

Does anyone know if the IRS will be issuing an updated 401(a)(9) model amendment soon (or at all) for defined benefit plans?

I gave this a go on the 401(k) board, but no responses, so I'll try here:

Company A maintains a KSOP for itself and its subsidiary, Company B. Participants can direct the investment of their deferrals among several investment funds, including Company A stock. Company matching contributions are initially invested in Company A stock, but participants can redirect those contributions into any other fund.

The company is about to spinoff Company B, which will be an S Corp. After the spinoff, the account of every participant in the plan who is invested in Company A stock will hold shares of Company A and Company B stock. Because Company B stock will no longer be employer securities, and because Company B stock will subject the plan to UBIT, Company A plans to close Company B stock as an investment fund and prohibit plan participants from investing any future contributions in that stock and, over time, the plan will attempt to get rid of its Company B stock. However, it may take a while because of the limited market for Company B stock.

One idea that is being contemplated is for Company B to establish an ESOP, to which the accounts in Company A's plan of the Company B employees will be transferred. As a result of the transfer, both plans will hold stock of both companies. The two plans would then do a "stock swap" (i.e., Company A's plan exchanges Company B stock with Company B's plan for Company A stock of equal value). After the swap, the Company B plan would hold only Company B stock, while the Company A plan would still hold some shares of Company B stock, but fewer than it did before the swap.

A few questions:

1. Because participants have the right to direct their investments, can Company A unilaterally do the stock swap and replace shares of Company B stock in participants' accounts with Company A stock?

2. A similar question with respect to Company B stock remaining in Company A's plan after the stock swap (or all Company B stock if the swap does not occur). Does the participants' right to direct investments impact the ability of the plan to sell Company B stock over time?

I realize that an investment fund is not a protected benefit and a plan sponsor can eliminate a fund whenever it deems it necessary, but in most cases, the fund being replaced is a mutual fund, and the replacement can be done on a single day. Just curious as to how the gradual phase-out of Company B stock can/should be done.

Any thoughts?

I had a few questions about the JOBS/AJCA bills.

(1) If an employer maintains more than one account based qualified plan and only allows participant direction on some of them, do you think that the investment options for the non-qualified plans are limited to the shortest list for all of the account based plans or the shortest list for participant directed plans?

(2) If an employer has a fiscal year that starts in either the last week of December or the first week of January (e.g., ending on the sunday closest to 12/31) and adopts a bonus plan based on that fiscal year, for a bonus earned for a fiscal year that starts in December year 1 and would otherwise pays out in year 3, must the deferral election be made (a) prior to 12/31 of year 0 or (b) prior to the start of the fiscal year in year 1.

(3) If distribution elections may only be changed if the change is not effective for 12 months and defers payment for at least 5 years, may a plan permit a change to the form of payment that does not push out the payment commencement date. For example, if a participant has elected quarterly installments over 10 years, may he change his election (more than a year in advance) to elect either a lump sum or installments commencing at the same time but paid over 20 years.

(4) May a plan continue to provide for accelerated payout on plan termination?

(5) May an employee who is promoted into an eligible classification during the year still elect to defer a bonus attirbutable to service both before and after the date of promotion if the election is made within 30 days of becoming eligible?

We have a plan that had a group of employee's become unionized 1/1/2004. The plan had no other union ee's in the previous year. The question is, since the plan uses the prior year NHCE %'s, what percentage would we use when teting ADP/ACP? I am thinking the 3.0 for both ADP/ACP, but just wanted to get clarification.

Thanks.

What benefit is it to roll a Roth over as opposed to just putting it in Savings or spending it. Thanks, Bob

We have a client who would like to set up a cafeteria plan for it's employees. They are a C-Corp with only 2 employees. Both employees are owners. Can we set up the plan for them even though there are no other non-key employees? Do we have to perform testing since there are no other non-key employees?

When counting participants for purposes of applying the small welfare plan filing exception, does 29 CFR 2510.3-3(d) allow you to exclude eligible employees who are not "COVERED" meaning those who: (1) have not met the plan definition of "participant," and (2) are not subject to the occurrence of the contingency for which the benefit is provided--I'm not sure what this means--I assume it means the employee applying for the benefit/requesting reimbursement, etc.; and (3) never make a plan contribution.

EBIA seems to think 2510.3-3(d) limits those eligible employees counted to "covered participants" -- ERISA Complioance volume p. 574.

Good Morning All,

I am on the verge of obtaining a Benefits Specialist position where I will be focusing on the administration of benefit plans for their Canadian employees. The company is an American company who has more than half of its employees in Canada. I have practically no experience with the Canadian benefit system (both H&W, and DC and DB benefits), and was curious if anyone could point me in the right direction as to where to obtain the best, most recent information. IF I get this position, and I am almost positive I will, I want to jump out of the gate running and impress the employer out of the box.

Thanks.

Adam

Good Morning All,

I am on the verge of obtaining a Benefits Specialist position where I will be focusing on the administration of benefit plans for their Canadian employees. The company is an American company who has more than half of its employees in Canada. I have practically no experience with the Canadian benefit system (both H&W, and DC and DB benefits), and was curious if anyone could point me in the right direction as to where to obtain the best, most recent information. IF I get this position, and I am almost positive I will, I want to jump out of the gate running and impress the employer out of the box.

Thanks.

Adam

Good Morning All,

I am on the verge of obtaining a Benefits Specialist position where I will be focusing on the administration of benefit plans for their Canadian employees. The company is an American company who has more than half of its employees in Canada. I have practically no experience with the Canadian benefit system (both H&W, and DC and DB benefits), and was curious if anyone could point me in the right direction as to where to obtain the best, most recent information. IF I get this position, and I am almost positive I will, I want to jump out of the gate running and impress the employer out of the box.

Thanks.

Adam

Good Morning All,

I am on the verge of obtaining a Benefits Specialist position where I will be focusing on the administration of benefit plans for their Canadian employees. The company is an American company who has more than half of its employees in Canada. I have practically no experience with the Canadian benefit system (both H&W, and DC and DB benefits), and was curious if anyone could point me in the right direction as to where to obtain the best, most recent information. IF I get this position, and I am almost positive I will, I want to jump out of the gate running and impress the employer out of the box.

Thanks.

Adam

If I withdraw some of my contributions (not investment returns) from my Roth IRA is there any way to pay this back?

I've been contributing the maximum yearly amount, and plan to continue to do so, but I've run into a situation where I could sure use those funds for approximately 2 years but am loath to pull them out if I can't replace them later

Thanks!

I recently opened a Roth IRA. I'm a college student working full time. Should I contribute as much as I can afford to the IRA ($2,000 to $3,000 per year - leaving very little leftover for me to save somewhere else), or should I contribute less (say $1,000 or so) and save some money in a different type of account for things like a car, a house, or any other unexpected expenses that come up?

Also, a bit unrelated to Roth IRA's, but I will be getting married within the next two years. Can anyone give me some tips on how to prioritize my money? For example, is it more important to contribute the max to my IRA than it is to save for a downpayment on a house? When should I start saving for my children's future? etc. Thanks for your help!!

Jackie

Suppose you have a profit sharing plan with a 12/31/04 year end. Also, suppose the employer made 10% of pay profit sharing contributions (for the 2004 year) to all eligible participants by 7/31/04. The employer wants to convert the plan to a safe harbor 401(k) plan by 9/15/04. If safe harbor notices are provided to employees prior to 9/30/04, can we rely on safe harbor treatment for the 2004 year?

Thanks much.

I have a client that is toying with the idea of raising the plan's minimum loan amount from $1,000 to some higher amount. They are trying to reduce the quantity of loans. They have already restricted loans to one per participant but do not want to restrict loans by circumstance.

We explained that the plan would have to pass discrimination testing each year. We would charge quite a bit to do the testing. But they are still hanging on to the notion.

They want to know what would be the correction if they failed the test during some year. I haven't found any guidance to answer their question.

Is anyone familiar with type of circumstance?