Does anyone know of a resource that discusses the taxation of domestic partner benefits at the state level? Is there a list of states that exclude those benefits from taxable income?

When determining the participant's account balance as of the prior plan year end, do I include receivables?

I recently quit my job to stay at home with my kids. I have about $10,000 in a 401K plan, 100% vested. As I understand it I basically have three options at this point.

1) Rollover to a retirement account. (Lots and lots of questions here!!)

2) Leave account in plan. (Not sure on this one.)

3) Single sum payment. (Definetly not.)

I don't plan on going back to work for atleast two years, maybe more. I do not need or do not plan on touching this money till I'm old 'n gray, which doesn't "feel" that far off sometimes. BTW, I'm currently 33 years old.

Anyhoo, I'm thinking I probably want to go with option #1 but I've got tons of questions. Obviously I don't expect someone on here to plan my retirement but can someone recommend a good website that explains, in layman terms, Roth IRA's, conventional IRA's, and the process involved in a rollover from a 401K. Of course any and all suggestions, advice, and explanations are most welcome.

Thanks.

Had a proposal roll across my desk in the last couple of days and seem to have lost my train of thought.

1) 1-Man Sponsor, previously maintained a DB plan. Plan was terminated in 1997, distributed LS in 1998 to successor PS plan. Plan at that time had NRA of 60, participant was age 59 at time of distribution. Lump sum received to PS plan in 1998 was 1.078m. AE in old plan was 1983 IAM, all ages setback 4 years, pre-ret i of 7%, post-ret i% of 5%.

2) Looking to establish a new DB plan to take advantage of increased 415 limits. Plan would be effective 1/1/2003, age 64 at start, NRA of age 69 (5 years of part rule for NRA).

What is throwing me for a loop is how to calculate value of prior LS received, as far as assessing a SLA annuity value.

Do I:

- Determine SLA AB based on actuarial equivalence assumptions in effect at time of distribution (looks like GATT played a little into benefit at that time), using LS paid, attained age at distribution, and retirement age under prior plan, and then actuarially increase to new NRA based on prior plan assumptions?

- Determine SLA AB under proposed plan assumptions (say 94GAR @ 5.5%) using attained age at distribution and NRA of 69 under new plan?

Help (trying not to get caught up too much in minutae as far as exact age - principals on nearest age would be fine to get back on track).

For tax withholding purposes, are the 70-1/2 distributions considered periodic or no-periodic? Since they are required to be made every year, that should qualifies them as periodic?

Different tax withholding rules aplply to periodic vs. non-periodic pension payments.

Will you be submitting your Volume Submitter "word-for-word" Plans to the IRS? Why? Thanks for all input!

I am fairly new to cafeteria plan administration, and I have a question I'm hoping all you experts can help me out with.

I know that under a healthcare reimbursement plan, a participant is entitled to be reimbursed up to their annual election at any time during the plan year. But what happens if a participant terminates employment and then timely submits a claim for reimbursement? Provided the services were incurred before their termination date, are they eligible to be reimbursed up to their annual election amount, even though they will not contribute the remainder of their annual election, or are they only entitled to their contributions to date for that plan year?

I would really appreciate any input!

Does anyone have or know a source for spanish language materials explaining a flex plan?

I have a Profit Sharing Plan with an April 30th plan year end that coincides with the Company's fiscal year. The plan uses prior calendar W-2 wages for the compensation definition. The Employer is tossing around the idea of adding a 401(k) provision to the Plan. Due to the demographic of the Company, I would recommend that the client utilize the safe harbor matching provision to get a pass on the ADP/ACP tests and allow the highly comps to defer the max. (They will be lucky to get anyone in the lower group!) Can the plan continue using the definition of comp as prior calendar year W-2 when they add the 401(k) provision? Is it an issue that the data used for the 2004/05 plan year will be 2004 calendar year info with deferrals only from May - December? Must/Should I recommend that the client change the plan and /or limitation year? Am I overanalyizing this??? Thanks in advance.

I've seen a couple of threads stating that if an employer pays cash to employees who opt-out of health coverage, a cafeteria plan needs to be in place to avoid constructive receipt for those who elect the health coverage. Is this still the case if only 1 employee is given the choice to receive cash for opting out? Are all other employees (who don't have the cash option) affected such that a cafeteria plan is necessary?

In a straight percent qnec calculation - If one of the members reaches their 415 limit, how is the excess money distributed to the rest of the NHC's? Does the same amount go to all or is it prorated based on their compensation?

Example:

It's determined 1.75% QNEC needs to be made to the 3 NHC ee's.

EE 1 has a comp of 39,000 so their qnec is 682.50

EE 2 has a comp of 42,000 so their qnec is 735.00

EE 3 has a comp of 58,000 but reaches the 415 limit at 1%. Their qnec is 580.00. How is the additional 435.00 distributed?

217.50 each to EE1 and EE2? or will EE 2 get more because their comp is higher?

Is it possible to purchase some type of plan/policy which provides just additional medical coverage for employees who are traveling

in the US on company business. We recently reduced our coinsurance percentage and increased the deductible and out-of-pocket

maximums in our self-insured medical plan. As a result, concerns have been raised by some employees of the increased financial

liability when traveling.

Comments/thoughts/suggestions?

I have a 3% safe harbor 401K / cross tested plan for a physician group.

There are 9 rate groups -- one for each physician PC ( each PC is a partner in the group) and then one other group for all other employees.

Last year one of the younger doctors decided to max out their profit sharing contribution. This drove up the rank and file costs quite high to pass testing.

The highest doctor got 11% of pay and the rank and file got 17% of pay.

Some of the physicians elected not to put anything in the profit sharing plan for themselves.

The administrator said there was no way around this.

Other TPA's have been saying that it could have been possible to test this on contributions as opposed to benefits. And if so then we could have limited the costs on the rank and file to 11% ( the highest contribution that any doctor received ).

Any thoughts or ideas would be appreciated !!!

I read Gary's comments about how it is not possible to maximize a business owner with maximum compensation at $40,000 if his SEP plan is integrated with Social security. Can you elaborate on this in detail ? This is not the rule with profit sharing plans.

Does it also apply to SAR SEP plans ?

If a plan is established (signed document) but no contributions are made during that first plan year, is a form 5500 required to be filed? I have heard that a 5500 is not required if there are no plan assets but I have never seen it in writing. Any help would be appreciated.

I have a plan where the current match is 50% on the first 3% and 100% on the next 3%, no match above 6%. Now I have been informed the increasing tiered match formulas are not allowed. I have been pointed to look at Reg Section 1.401(a)(4)-4(e)(3)(iii) (g), but cannot find. Any help or direction will be appreciated. Thanks

Effective date of the Plan is 1/1/00.

Employer executed an "ad hoc" amendment to provide a one time contribution to all participants employed on 12/31/99, provided they have met the Plan's eligibility requirements as 12/31/99. The contribution is based on compensation as of 12/31/99.

Can a plan have such a contribution before the effective date of a plan?

It seems to me that this is an effort to circumvent the requirement that a plan must be executed before the end of the year. Has anyone seen this before? Are there any PLR's either for or against this, or regulations?

I did find this:

§1.401(b)-1. Certain retroactive changes in plan

See the last sentence.

(a) ... Section 401(b) does not permit a plan to be made retroactively effective, for qualification purposes, for a taxable year prior to the taxable year of the employer in which the plan was adopted by such employer.

As a self-employed solo professional contributing max to my SEP IRA, I want to roll over my 2003 SEP contribution into a Roth (and pay tax on the conversion amount).

While I know this is possible to do, I want to doublecheck that there are no restrictions on relative timing of the original conversion and rolling it over, that would fall in the same year under my proposed scenario.

Thank you for your advice,

Our company joined a multi employer DB plan for HCE but refused to allow NHCE to participate because they were collectively bargained. Plan states union may be excluded if their pension is bargained in good faith. HCE at company have three pensions, NHCE have one.

Is there anyone registered here who knows how the IRS responds when a client complies with their instructions? In this case, the Roth IRA is going to be cancelled and 50% of the Required Minimum Distribution for a former year is going to be sent with the form 5329 along with an explanation of how the client got sidetracked into this situation.

What will the IRS do? Will they calculate taxes due for former years and subtract them, possibly refunding the remainder? Or what?