I know that the instructions for the Model SEP say that you cannot use the 5305 SEP if you maintain any other qualified plan. But if you are terminating a qualified plan and then establish the SEP, is there a problem using the model, or must the client go to a prototype instead?

Other than a conversion to a cash balance plan, are there any other practical means for converting a unit benefit DB plan to a DC plan?

If a DB plan participant enters into a same-sex marriage in Canada, is the same-sex partner considered to be a "spouse" under the terms of the plan? Does the answer depend on whether the participant's state of residence prohibits same-sex marriages? The plan document does not define the terms spouse or marriage.

I am an American living and working overseas although I keep my assets in the U.S. I would like to minimize my tax burden by putting the maximum allowable amount into Roth IRAs each year. Can I do that if I declare myself self-employed (as I am)? Does my income have to be earned in U.S. dollars in the U.S. or can it be earned in another currency? Thank you.

A sole proprietor has a SEP for which no contribution was made for 2002. During 2002, sole proprietor became a participating employer in a company's profit sharing plan. Can the sole proprietor contribute to the profit sharing plan in which he is a participating employer instead of the SEP?

A client has a sole proprietor who has had a bad year(s) and does not want to make any contribution for the calendar year 2002. Unfortunately, there is no way this is going to happen with the facts. The SP and his advisor (do not know whether it is an attorney) has stated that they are willing to waive part of their accrued benefit such that a contribution will not be required.

I advised the client that the waiver is great for termination to make the plan whole BUT may not be recognized for minimum funding. The SP and their advisor want a specific IRS case or cite as to why they can not use the waiver (especially because there is only one participant).

The only thing I have been able to find is some very old Q&A / discussion whereby everyone agrees that it can not be done (it appears the reference is to 411(d)(6)???)

Any ideas??? Thanks in advance for any commentary.

Husband has a 401(k) Plan with a previous employer. Husband and wife are in the process of a getting a divroce. Wife wants to receive a portion of husbands account balance as a rollover without obtaining a QDRO in the interest of accelerating the process.

Is there any way to do this? Is there a loop hole for married people that one spouse can roll to the other spouse's account?

A makes participant contributions in 1985. The er does not pick up the contributions and A's contributions are all made on an after-tax basis. B is eligible to make contributions in 1985, but does not. In 2003, B elects to buyback his service for 1985 by making contributions for that year. The er now picks-up ee contributions. Can B's contributions made in 2003 be picked up despite the fact that they could not have been in 1985, the year for which the contributions are being made? The PLRs seem clear that you can pick-up buybacks of past service, but don't seem to address what happens with respect to years in which pick-up wasn't possible.

An LLC that is taxed as a sole proprietor established a 401(k) plan in 2002. What is the deadline for the sole proprietor to make 401(k) deferrals since it is unknown until after the year end what his profit will be? The due date for filing his personal return plus extensions?

My company is implementing a plan where it is contributing $2,000 worth of company stock to a plan for me. The company is then reducing my gross pay (semi-monthly) by the $2,000 over the year. My company sent around a powerpoint printout hyping this great deal. In it, they claim I am better off sice the $2,000 will not be subject to current income taxes and not subject to FICA.

My question is, can they do this? If so, how are they doing it?

P.S. I am told that I have to participate.

Can a SEP invest in real estate?

When your establishing a new retirement plan - safe harbor 401(k), when do the participants need to be notified of the plan. Is is so many days after its been implemented or so many days before?

Thanks.

Has there been any new guidance given on when a cafeteria plan needs to be amended? I am unclear of when or why I would update an existing cafeteria plan document. I understand that the FMLA provisions should operationally be in the plan but am unclear as to when it and various other laws are required to be in the plan.

Help

I'm involved in a debate about the definition of 'benefit commencement date' in DB plans generally. I know plan documents come into play, but are there any industry 'standards' or cites or articles of a generally accepted definition, such as we have with 'annuity starting date' (or is that a good definition itself?)

can somebody please point me in the right direction - I need to find a concise description of what investments are permitted in DB plans.

Thanks!

I have heard stories about providers who were penalized by the DOL because they took too long to transfer plan assets to a new provider, once sufficient (in whose eyes?) instruction had been received.

Does anyone have any direct experience with such activity? The principals of our company sometimes delay the transfer for a period of time while they try to "save" the case, and while I know there may be fiduciary exposure in theory, I would like some anecdotal reports if there are any.

Our loan policy does not specifically address 'additional payments'. Currently all plan loan payments are made through payroll deduction. The policy indicates it will allow for pre-payments (payment in full). It is our plan administrators opinion that any 'additional' principal loan payments would constitute a violation of the original loan payment agreement & schedule and cannot be accepted.

Any thoughts?

I have a client who maintains a DC 401(k) plan and has asked the following question:

Back in December 2001 the officers of said company took substantial pay cuts due to economic conditions. With the recovery of the business these three officers will be receiving their lost wages, which will be a sizable sum.

The million-dollar question is:

Is there not a three-year window that allows them to put more into their 401(k) when dealing with lost wages?

I unfortunately don't have a copy of the document but thought I would see if anyone had heard of such a window.

Thanks

Jim

I have four sub-S corporations that participate in one 401(k) plan. The plan sponsor (one of the sub-S corps) split from the other three sub-S corps split effective 1/1/2002. The three remaining sub-S corps continue to operate as a group. However, the plan sponsor has moved their portion of the plan assets to another broker.

The questions that surround this situation are numerable, but we basically need to know if this split constitute a distributable event?

I am happy to provide more info, if needed. Thanks for any input!

One of our clients currently maintains a 401K with a safe harbor match; can individual HCEs opt out of receiving this contribution? The reason for the question is the owners are thinking of implementing a Cash Balance plan and if the participants in the 401(k) receiving "Corporate" money and are also in the cash balance plan there are limitations applied to the contribution level attainable in the cash balance plan.

I hope this makes sense!

Thanks for your help!