Has anyone revised their plan doc/QDRO admin procedures to incorporate the now permissable charge to participants? We recently (October 1) implemented a $500 charge -- is this in the ballpark of what others are charging?

We are filing intial and final forms 5500-EZ for MP and PS plans that terminated this year as of August 2003. They are inital because they had never had combined assets of over $100,000 and final because the plans are terminating.

Question - can we complete the 5500-EZ on the approved 2002 returns or do we have to wait until next spring when the 2003 forms are released?

Thanks.

it seems to me an investment advisor could be responsible for a portion of the trust fund (certain investments) and not be responsible for other assets. If this is the case does it logically follow that an investment advisor can exclude employer stock from the assets for which he renders advice? if an IA did this and subsequent problems arrose with the stock and failure to diversify, could the IA be held liable for this failure to diversify?

Person is employed by two unrelated employers and potentially will be a participant in each employer's retirement plans (possibly PSP and 401(k)). It appears that the 415 limit and the catch-up contributions limit( see example in Sal Tripodi's ERISA Outline Book at 11.257 regarding situation where catch-up limit is exceeded where individual is participant in two separate 401(k) plans maintained by two unrelated employers where failed ADP results in refund of deferrals) are plan limits and the 402(g) limit on elective deferrals is the only individual limit. Thus, assuming sufficient compensation from each employer, it would be possible for a participant in two unrelated employers' PSP/401(k) plans to receive 40,000 in the PSP(Employer 1) and 42,000 (28,000 PSP contribution, 12,000 deferral, and 2,000 catch-up) in the 401(k)(Employer 2)???

Have a situation where an employer is paying some of it's employees (bus charter company) by the hour and some of it's employees (drivers) by the miles they drive. How would they determine when an individual has met the 1,000 hour eligibility when they are being paid by miles driven vs. hours worked?

I am aware of the elapsed time method but these employees are not full time so not sure this would work.

Any thoughts would be appreciated.

Thanks,

Diane

I currently have a Personal Pension Scheme with a company in the UK. It is losing value tremendously and I would like to move it to the US. I am 46 and have been told that the money is not movable until 50. At this rate the Scheme will be worth half of its value by then. The tax person I spoke to in the UK told me that I could transfer the money to a substantially similar fund in the US. What does that mean and would an IRA meet that requirement?

For purposes of calculating a participant's required minimum distribution from more than one 403(b) plan, I seem to recall that a participant can total the minimum amount from each 403(b) and take the total minimum distribution from any one of the 403(b) plans (rather than taking a minimum distribution from each plan). I think that I am correct but I could not find the cite - I think it is in the 401(a)(9) regs but I could not locate it. Does anyone know the cite?

Thank you.

Company A, B and C were merged into a controlled group in 2003. A, B and C all have Simples. Company D has 401k plan. Do we have any controlled group issues regarding the Simple plans? Can we leave them as is until 1/1/04 when all employees will participate in Company D 401k plan?

I am reading the instructions but am still unclear. Is a Form 5500-EZ required for the year if the beginning of year assets are $70k and the end of year assets are $110k?? It seems to be based on prior year end of year assets, so, no for this year, but yes for next year.

Can anyone confirm?

Please let me know.

thanks

It's been a while since I experienced a DB plan termination with excess assets, but it is my understanding that when excess assets are allocated the formula must meet nondiscrimination under 401(a)(4) as it relates to the DB plan.

My experience has been limited to effectively reallocating assets pro rata to participants on their PVAB. Although, in reality the formula is just being increased from X% of pay to (X+y)% of pay, still satisfying a safe harbor formula.

What I am considering is looking for possible alternatives to the pro rata approach, and it seems to me that any method can used so long as it passes 401(a)(4) and is not contrary to the document. If so, when testing is performed (assuming the annual method), would you say I test the total accruals for the year or just the allocation of the excess amount? I don't see any justification for the latter, including my reading of Rev. Rul. 80-229.

Client would like to start up a 401(k) plan for he and his wife (only employees) that also allows PS contributions. They both have account balances from an old SEP-IRA that they would like to rollover into the new plan. Can these rollover amounts be used to pay for insurance premiums in years where they do not make any contributions?

Although every year the premiums cannot exceed 50% of the contributions (they want whole life), would the elective deferrals count as the contribution in addition to the profit sharing?

The document can be drafted to allow for withdrawals pursuant to the IRS 2-year rule. The doc also states that such amounts can be used in addition to the incidental benefit limit to pay premiums. That would seem like an easy way to circumvent the incidental benefit limit by using plan assets to pay for the premiums (at least partly) as opposed to the employer paying the whole amount. Are there any other aspects to this that should be considered?

Can the son of the IRA holder ( who is a liscensed real eatate agent) receive a commsssion normally paid (on real estate sales), on out right purchase of lot in IRA without triggering self dealing rules?

I know this has been discussed but I am still confused. An employee takes a premature distribution from an IRA. He wants to roll this into the 401(k) Plan. Is this rollover "cleansed" of all IRA characteristics? Is there any reason that the IRA rollover must be segregated from other rollovers? Is a deemed IRA only applicable to new IRS money? I found guidance on deemed IRSs, but none on rollove IRAs. Can you direct me?

Thanks (I am very confused)

I'm having an unusually hard time confirming this but do SIMPLE IRA salary deferrals count towards the 402(g) limit? Does it matter SIMPLA IRA vs 401(k)/

Thanks for the guidance.

We have a ps plan for period ending 12/31/02. The contribution allocation is 25% of comp. The deduction will be the same. There is a forfeiture of appx $20,000. I can allocate it and no one will hit their 100% of comp value.

Can I reallocate the forfeiture without a problem? I have a mental block about the 25% limit. In other words, with contribution along with the forfeiture will give everyone about 27% of comp, ok? Naturally, the employer would only deduct the 25% because he has already deducted the forfeiture once.

Thanks.

Small law firm has 2 partners, both highly compensated employees (X and Y), 1 attorney (Z), and 4 staff people. X and Y contribute to a SEP plan. X and Y pay Z and salary and issue a W2. X and Y pay Z a 50% commission on any business Z brings in and issue Z a 1099 for that commmission.

I understand there are issues with X and Y issuing both a W2 and 1099, but if Z pays both the er and ee portions of FICA, still a problem?

Also, Z had originally intended on making a contribution to a SEP plan. However, instead can Z can set up a profit sharing plan for Z only in 2003? Z's salary plus commission is currently less than $80K, but expected to grow. No staff ees nor X or Y are interested in participating in the profit sharing plan.

What issues with

-starting profit sharing plan at end of year?

-discrimination testing?

-contribution limits?

Forgive me for this, my knowledge on IRA's is hazy...

Can an employer maintain a SAR SEP & 401(k) during the same calendar year?

I started a job with a different company about 5 years ago and had a rollover fron my previous emplyer to a new 401K plan.The current plan is accessible thru the internet and I have noticed that the Managing company charges my account a monthly"expense" of about $75 per month.I have questioned my company about this and they have provided no explanations.I have requested info from the Managing company on at least 10 different occasions.They have not even returned 1 single call and I call them every day.I have a brother in law who also works here and is in the same plan,but his"expenses show about $10 per month.My questions are: What are the legal "expenses" a managing company can charge?Do I need an Attorney? Can someone help?

OK, what's the latest here? I've searched and read many historical threads on this topic, but cannot ascertain for sure whether this is a poor plan design or not. Is a top heavy plan required to provide top heavy minimums to otherwise excludable employees who are allowed to defer, but are not receiving the safe harbor contribution? I believe the argument is based on the definition of "solely safe harbor" and whether or not you can claim that status since you have participants in the plan not receiving the safe harbor contribution. What is Sal's latest position?

In a 401(k) plan, what happens if there is only one employee who happens to be the sole owner (thus being Key Employee) and is contributing to the plan. The plan is Top Heavy, but how is the corrective 3% action handled?