Does anyone know of a source to obtain these table values?

I have a Plan that requires 1000 hours for a participant to receive an allocation (integrated PS) for any given year. I am getting a warning that I am failing the "Special" ratio percentage test because I have more than 30% of my NHC Group that is only receiving a 3% TH contribution and not the full contribution since they only worked 700 hours during the year.

Assuming that my document would allow it, do I need to ensure that some of these "not benefiting" participants receive the full contribution vs. just the TH 3% minimum that they are currently receiving? If I test the Plan under the 401(a)(4) General Test and pass, is this sufficient?

Any thoughts would be greatly appreciated - I reviewed the 401(a)(4)-2(b)(4)(vi)(d)(3) Regulations and "surprisingly" become more confused.

Thanks

RDS

Law firm is a partnership owned by two partners - Partner A-50% & Partner-B 50%.

Partner A also owns 100% of P.A. which is an S-Corp.

Partner B also owns 100% of P.A. which is an S-Corp.

Non-Partner C owns 100% of P.A. which is an S-Corp.

Non-Partner D owns 100% of P.A. which is an S-Corp.

The Partnership sponsors a safe-harbor 401(k) plan which is treats all four S-Corp.'s as affiliated employers. The safe harbor is a 3% non-elective.

Non-Partner C is no longer affiliated with partnership. Leave on March 31, 2004. Does he have to receive safe-harbor non-elective for 2004? If yes, is it based on his W-2 compensation from his S-Corp. for the period 01-01-2004 to 03-31-2004? He does not get paid from the partnership.

Line 7b says "retired or seperated participants receiving benefits." For a 401(k) plan, does this mean we should be listing only those people who are recieving annuity payments? If a person is retired or seperated, has an account in the plan, but has not taken a distribution, shouldn't they be listed on the next line, 7c? (other retired or seperated participants entitled to future benefits).

I ran a 5500 Count report on Relius and it is plugging numbers into both lines, but I think they should only be on line 7c, as this plan does not have annuity payments.

Your thoughts? Thanks!

We rarely recommend to clients that they exclude bonuses from allocation

compensation unless we are fairly confident that the 414(s) compensation

nondiscrimination testing will pass each year. However, in the case of a

Safe Harbor match plan (or a deferral/match plan for that matter), I'm

thinking that even though compensation is defined as ALL compensation, the

plan could result in discrimination another way. The Datair prototype

document has a specific option for allowing participants to defer on their

bonuses. There are 3 options: (1) deferral on bonuses is permitted, (2)

deferral on bonuses is not permitted and (3) a special election will be

made. We have typically asked our client which option works best for their

situation and the way they handle the logistics of paying bonuses. BUT, if

the plan is also a safe harbor MATCH plan with no "true-up" provision, match

calculations are made each payroll period, and the client selects #2,

couldn't this result in discriminatory operation of the plan? (yes, we asked Datair and the initial take on it was "no")

Do you actually have to perform a top heavy test each year? For example, before we do a Profit Sharing calaculation for a client, we need to know if the plan is top heavy or not. My client said, "Oh no, we're not top heavy." I asked if she did one, she said she hasn't done one "in a while."

What are the consequences of not documenting a TH test each year. The plan is obviously not top heavy--one key ee, bal $150,000, non-keys, $2.1MM, but there is nothing actually showing the calculations.

(We did get something in writing staitng the plan isn't TH)

The audit firm doing the annual audits of our DB plan and our 401(k) plan is telling us that they must have the completed 5500's in hand before the can issue their final audit reports. Is this truly a 'requirement'?

It is causing us a problem because we would like to present the audit reports to the plan trustees at a meeting in May, but the TPA's will not be able to complete the Form 5500's on such an early schedule.

Any insights appreciated.

If the ADP test fails and refunds are made, can the test be recalculated and any margin between the NHCE ADP and minimum NHCE ADP be shifted to help pass the ACP test.

For example if on recalulation the HCE is 5.5% and NHCE is 4%, can 0.5% be shifted to the NHCE ACP?

I haven't been able to find a prohibition unless the proposed regulation anti-abuse rules would squash the idea.

It has been a big year for failed tests.

Could anyone refer me to a calculator for an IRA RMD? Secondly, how is it calculated if person has been taking out small monthly amounts for five years and will now be turning 70 1/2. What beginning account balance is used and what start date? He needs to make sure he's taking out enough with the minimal distributions he's been taking annually. Thank you in advance for any help you can provide to me.

Fact pattern:

* 4 participant plan - Ee A is owner, Ee B is wife of owner, Ee C and D are staff

* Contribution allocation requirements are last day of employment and 1000 hours

* Safe harbor is 3% nonelective

* Plan is top heavy

* Ee C and D terminate during the year with more than 1,000 hours; each receive 3% safe harbor contribution but not the profit sharing contribution

Is there a requirement to disaggregate the profit sharing allocation from the safe harbor nonelective contribution when testing for coverage?

Thanks for your help!

Treas Reg 1.401(a)(31)-1 A 16 states the following:

A plan will not fail to satisfy section 401(a)(31) merely because the plan does not permit a distributee to elect a direct rollover of an eligible rollover distribution in the form of a plan loan offset.

My questions is....If you do not have to offer a direct rollover option for a loan offset, do you have to meet the 402(f) notice requirements?

How are others handling this? Do you send a notice and give the participant 30 days before offsetting? (I realize you should give the participant a reasonable amount of time after termination to repay the loan, but I am wondering if you have to provide the notice as well)

Thanks!!

Our fully insured dental and fully-insured HMO have said that they do not enter into Business Associates Agreements with the sponsors of the plan

why would this be?

I have an owner who is 74 years old. He just established a cash balance plan effective 1/1/03.

The question is whether he has a required minimum distribution due by April 1, 2004. My actuary is saying that since there was no accrual on 12/31/02, there would be no RMD for the 2003 year (which would be due on 4/1/04). I can not find a cite that backs up this assertion.

Can anyone explain and provide some authority? Thanks so much

I received a message from a plan participant/trustee this morning in regards to his possibly taking out another loan from the plan. The plan allows for up to 2 o/s loans at a time, and has no limitations on the purpose. He was asking about the terms of a loan for the purchase of a primary residence, so I am assuming that this would be the reason for the new loan. The problem is, the loan he took out in 2000 was for 15 years and the purpose listed is "real estate expenses." Since the lengh of the loan was for more than 5 years, I would assume that this is for a home purchase.

Could he take out another loan to purchase a primary residence, even though his first loan is for same? My concern is that he has two loans of the same "type" o/s.

Thanks for your help!

I have heard a number of times that a 403(b) is more preferable to a 457. Can anyone list the top reasons why (or even why not?) Thanks in advance.

I know this has been discussed here before, however every search failed.

Is there a web site that ranks SIMPLE IRA/401(k) providers? For example, which of the big mutual fund companies are the most highly rated?

Topic pretty much says it all....

Former participant in Puerto Rico 1165(a) Plan received a rollover distribution from the plan (in accordance with Puerto Rico Income Tax rules) and wants to roll over into a US 401(k) Plan.

Any guidance out there?

A man and his wife are the only 2 participants (and the only ee's) in a DB Plan. The wife dies leaving the PVAB (the death benefit in the Plan) to her husband. The husband essentially freezes the plan by amending it with a cap on benefits equal to his accrued benefit. No further contributions have been required since he froze the Plan due to good asset performance.

Now the assets have dropped and there is a funding requirement. The two liabilities pieces are his PVAB and the death benefit. He doesn't want to fund. Can he waive the death benefit for funding purposes? That would negate the need for funding. Can he waive any of his AB?

Generally, the YOP for S415 is the same as the YOP defined for a plan.

Is there a problem with defining a YOP >= 100 hours of credited service in a PY?

What's the minimum hours one can use - is 1 hour ok?

A plan has excess assets which are increasing by leaps and bound by the week, so the plan needs to be terminated ASAP. Termination will take place within less than 2 months into the new plan yr.

All participants have <= 5 YOP and increasing the participation, even by 1 yr, would obviously would be very beneficial. Currently a YOP is >=1000 hrs during a PY.

A is a 1% owner. A's comp in 2002 is 200k+, A's comp in 2003 is 140k.

For top heavy determination, A is a key employee for determination 12/31/02. A is a former key employee for determination date 12/31/03.

Is A entitled to a top heavy minimum contribution for the 2003 plan year?