If a plan consists of pooled investment accounts for which the participants can direct which funds their contributions are invested, would this arrangement be considered "individual accounts" subject to the Blackout Notice requirements?

Controlled group of companies all with their own 401(k) Plans. One company closes down and terminates its 401(k) Plan. Employees of terminated company are transferred to another company in the controlled group. Do the prior plan assets of the transferred employees have to be transferred to the new 401(k) Plan or can they be distributed?

When is a phantom stock plan an ERISA plan? This one is a single employee (basically like a contract for a bonus in the form of phantom stock (cash) upon sale of company)

When is a phantom stock plan an ERISA plan? This one is a single employee (basically like a contract for a bonus in the form of phantom stock (cash) upon sale of company)

I have always allowed round trip mileage but an associate heard that it's just one way... any thoughts?

A mother inherits the IRA of her deceased son, who was age 50 or so (the mother is in her 70's). Can the mother treat this as an inherited IRA and spread the distributions out? The broker says that since it's going from son to mother, the entire distribution is taxable in 2004, the year the brokerage account was "liquidated". The mother would like to put the money back in the IRA and spread the distributions, if possible.

Any replies would be appreciated.

Is a grandfathered governmental 401(k) plan subject to the Sarbanes-Oxley rules regarding blackout notices?

If two 401k plans are mergering, under ERISA is there a specific timeframe during which the plan sponsor must send out a communication piece to plan participants? Which plan sponsor is responsible for sending out the notice - the existing plan sponsor or the plan sponsor of the new plan into which the plan is merging?

To start with the topic: I'm curious as to what my Roth IRA should be invested in?

But first, I would like to thank you everyone who responded to my post a few weeks ago about Roth investments. I've read up a lot and now feel a little more secure about my financial future.

To remind those reading THIS post, I'm an 18 year old high school graduate, who is looking forward to college in the fall. For years, I've loved the market, but due to recent underminings (poor stock choices) I no longer want to be in the game. Too much fluctuation. But two years ago, I heard of Roth IRAs and how tax-free money for your retirement was the way to go. Now I've saved money very well, allowing me to have "emergency" money, "play" money, and now "retirement" money.

My business teachers explained to me that I must immediately begin my Roth IRA for time is ON MY SIDE. I am aware there is a $3000 limit/year and because I'm going to college on several scholarships, I need not worry about not making the payment. So basically, I want to invest as much as I can, into a fund that will give me the greatest return in my retirement. This way I'll not only have my military pension (planning on joining the air force after college), but a nice retirement portfolio.

So in closing, I'm just a little unsure of in whom to invest in? I already know about a few things. For instance, banks nowadays have very poor returns, stocks are doing bad and probably will continue to do so, but index funds allow for the "dollar-averaging" scheme to take place. So now its really a matter of what index fund and what broker. Does it have to be a broker? I mean, who else does Roth IRA/Index Fund investments? Do they charge a commission? I just want to do things right. I do have some time however because I just turned 18 about 4 days ago, LOL. Thank you for reading this...and any help in this matter would be GREATLY appreciated. Thanks again. Look forward to your replies

Upon shareholder's death, his shares of Company stock were transferred in 2003 to Trust A and Trust B. Trust A and Trust B are irrevocable. Presumably, shares received a "step up" in basis at time of shareholder's death. Trustee of Trust A and Trust B proposes to sell shares to ESOP.

My thinking is that sale won't qualify for 1042 treatment because Trust A and Trust B have not owned the shares for at least 3 years. Since the shares received step up in basis at shareholder's death, it seems to me that the Trusts cannot tack their holding period to the shareholder's holding period.

Any thoughts? Thanks.

Is this article correct? http://www.foxnews.com/story/0,2933,125994,00.html

I always thought different and I think I read different on this board and some reference material- in that the conversion would have to include some of the after-tax and some of the pre-tax

Part of what she says is

Now here's where things get interesting. Consider rolling your after-tax contributions into a separate traditional IRA. This is a relatively new twist and is only possible because the 2001 Tax Act introduced a provision that allows rollovers of after-tax contributions.

Since your income will clearly be below the $100,000 limit for Roth conversions, once this money hits IRA #2, you can immediately convert it to a Roth IRA. From then on, any gains the account generates will be tax-free. Furthermore, unlike the owner of a traditional IRA, the owner of a Roth IRA never has to take any withdrawals. (With a traditional IRA, you must begin withdrawals the year you reach age 70 1/2.) As I've explained here before, when you convert money in a traditional IRA to a Roth, you have to pay income tax on the amount that has not yet been taxed.

But here's the beauty of the strategy I'm suggesting: By definition, you already paid income tax on your after-tax contributions! (Hang in here with me.) By detaching the earnings from these contributions (and sending these to IRA #1), the only assets in IRA #2 are those which have already been taxed. So the conversion costs you nothing!

You end up with a traditional IRA (IRA #1) containing all of your pre-tax money (both contributions and earnings) and a Roth IRA (IRA #2) with after-tax money that can benefit from tax-free growth for as long as it remains in the Roth.

The situation is that the individual considers herself self-employed, although her "vendor" issues a W2 and withholds taxes, but does not include her in their plan (she is a mortgage loan processor that works with a bank).

I think that most likely their plan is just excluding her in a class, and because the plan can still pass testing, that's okay. I don't see how the bank could treat her as an employee by issuing a W2, and then have her still be self-employed. She claims that she files a Schedule C as well, but on that same income. This bank is her only "customer". If they were treating her as a vendor, wouldn't they issue a 1099 rather than a W2?

The individual has a SIMPLE plan already and has been contributing routinely.

If this is legit-- Can someone please explain how this works?

I need some help on figuring out whether certain employees are considered participants for top heavy purposes. Let's say that the eligibility for a plan is "employee who is a member of the sales team". For two years employee satisfies the participation requirements and participates in the plan. In year three employee becomes a manager and is no longer a member of the sales team. However, employee has not terminated employment with sponsoring employer. Has employee's participation terminated? Is employee still required to receive top heavy minimums if plan becomes top heavy? Citation would be helpful, if available. thanks in advance.

A single employee (owner) plan terminates in late 2003. Plan is under funded. Since Funding Standard Account stops in 2003 is there any way to make a contribution for 2004 and claim a 2004 tax deduction ? The 2003 contribution was made and the 2003 corp. tax return filed, although he didn't contribute the 2003 max contribution available. He has since found more money he'd like to contribute in 2004 and deduct. What deduction options does he have for 2004 (if any) ? Thanks for any thoughts.

With my client sending employees to Iraq and Kuwait to service a government contract, the question about life insurance has come up. This group's current carrier has stated that any death claim for reasons including "act of war" will be covered, however AD&D, LTD & STD claims will probably not be covered. Curious to know if there are any carriers out there that provide a more liberal contract than what we normally see on the street (that might cover AD&D, LTD & STD claims when due to "act of war"). Feedback?

Incumbent Carrier's Position:

Our Group Life contracts do cover losses that occur as the result of war or

acts of war. Generally, Group Disability, Group Long Term Care, Accidental

Death and Dismemberment and Business Travel Accident contracts do not cover

those losses.

Does the contract exclude losses that occur as the result of war?

The response varies by coverage:

Group term life contracts: Contracts do not exclude deaths that

occur as the result of war or acts of war.

AD&D: Most contracts do exclude losses and deaths that occur as the

result of war or acts of war ("war" means declared or undeclared war

and includes resistance to armed aggression).

Short-Term Disability: Most contracts do exclude disabilities that

occur as the result of war, declared or undeclared, or any act of

war.

Long-Term Disability: Most contracts do exclude disabilities that

occur as the result of war, declared or undeclared, or any act of

war.

Long-Term Care: Contracts do exclude losses that occur as the result

of war or acts of war ("war" means declared or undeclared war and

includes resistance to armed aggression).

This particular case has the DAP contract. Therefore, the LTD would

exclude disabilities that occur as the result of war, decalred or

undelcared, or any act of war.

An AD&D example:

e.g#1. if the AD&D contract contained a war exclusion & the participant was

killed by an act of war, there would be no benefit payable

e.g.#2 - same AD&D contract - if the participant were on a military ship

and fell down a flight of stairs and were killed - benefits are payable

.....it's not a matter of "where" the insured is, rather it's "how" the

loss occurred.

We have a situation where we have not taking the amounts deferred into account for purposes of FICA reporting. All employee contributions are 100% vesting and therefore should have been taken into account when. How do we go about correcting this? The regulations simply state the non-duplication rule does not apply and that the entire amount will be taken into account for FICA purposes when it is distributed. Also, it states that penalties and interest may apply. I read this to mean that we do nothing now with respect to the prior years and when it is actually paid out, include it for FICA purposes. Going forward, we will operate per the regulations.

Any thoughts? Suggestions?

Thanks!

Governmental plans are exempt from various ERISA and IRC vesting and funding rules. But what if a plan starts out private, then becomes governmental--to what extent do the ERISA and IRC vesting and funding rules "carry over"? E.g., assume that a privately-sponsored qualified pension plan neither provided § 203(a)(3)(B) service notices nor the alternative actuarial increases when participants beyond normal retirement age continued working. Then a governmental entity obtains the private sponsor and restates the plan as a qualified governmental plan.

If the plan had remained a private plan, retiring participants would be entitled to the actuarially-increased benefit (because of the failure to provide notices); but, per § 411(e), a governmental plan is exempt from the 411 rules. Does the fact that the participant accrued most of his benefit under a private plan impose any requirements on the governmental plan, or is the governmental plan relieved of such responsibility once the plan becomes governmental?

Is it required that the 401(k)(3)(F) and 401(m)(5)© optional

discrimination testing method regarding otherwise excludable employees

for ADP and ACP testing be stated in the plan document?

One of my friends has a Keogh plan (only one employee). What form can he use to get an extension for filing, a 5558? Could he than file on 10/15/2004?

Hello,

I submitted my resignation with my former employer in late October, 2003. In my resignation email, I stated my last day would be January 1, 2004. My former employer agreed to this resignation date (via email). During the month of December 2003, my former employer asked me several times to assist the company by working 2 weeks into January, 2004. I agreed to this extension and arranged my schedule to accommodate him.

On December 30, 2003 I was working my regular shift (3pm-midnight) and my employer arrived into the office around 7pm and told me he had decided to let me go tonight. I told him I wanted to work into January and he said this is the last night I will be working. He prepared a resignation letter for me and said the only way I would receive my paycheck would be to sign the letter.

When I contacted him around the middle of May 2004, he stated since I did not work through the last day of the plan year (December 31, 2003), I'm not entitled to the contribution. He stated a specific page in the SPD which has the last day rule clause. The only problem is the original SPD document which my employer gave me, just happened to be missing that page. Its skips from page 2 to 4 and does not contain the last day rule page.

I still have the original SPD and I also have a signed letter by an ex-employee stating he heard the employer say he was going to terminate me on the night of December 30, 2003. I also have copies of the so-called resignation letter, which the employer prepared, an email which I sent to the employer stating my documented resignation sent in late October. In my resignation email, I state I will be leaving the company on January 1, 2004. The employer also replied to the email confirming this date. I also have a company schedule from December 30, 2004 and it has me scheduled to work all the way through January 3, 2004.

I have already made my initial claim (denied) and have recently filed my claim appeal also. Since I have not been notified, I don't believe I will be receiving my contributions.

With all of this evidence, do you guys think I have a legitimate case to bring a wrongful termination suit against the employer? I also wanted to know the details about contacting the labor board and having them contact the employer regarding these issues. Is this possible?

My total employment was from 5-11-2000 to 12-30-2003.

Thanks,

Slufoot2000