Does anyone know a good site to download the new 401k regs? Thanks.

I've read Corbel and ASPA's comments to catch-up contributions final regs. With respect to discretionary employer-provided limits, they interpretted the preamble to mean one of the following: (1) Catch-ups over and above employer-provided limits in an IRS approved plan is ok or (2) employer-provided limits are ok, but not for catch-up purposes. Could the IRS be saying there is no legal basis for employer-provided limits in general?

ive got $500 to open a Roth IRA, where do you suggest I go to open it? Thanks!

I'm designing a floor-offset plan for a referral, and I want to make sure I'm touching all the bases, and touching them properly.

Basic information:

1.The floor-offset arrangement does not satisfy the f-o safe harbor, because the same people are not covered in both plans.

2.The offset is the ps contribution from the er's 401k plan. The allocation in that plan uses cross testing to satisfy a4.

3. Each plan satisfies 410b on its own, using the ratio % test.

The bases to be touched:

1.The db floor must be tested on a stand-alone basis on the net benefits after the offset is applied.

2.As long as each db rate group passes the rpt I don't need the abt, which means I don't have to worry calculating the "combined" db/dc allocation/benefit rates. If I should need the abt I could still use the "special rule" and calculate the ab%s separately for each plan.

3. I don't have to bump the 5% gateway to 7-1/2%

Anything else I need to be alert to?

Plan year end is 7/31, limitation year is calendar year. Must the applicable limitation year be the calendar year in which the plan year ends (in which case you would not know the participants' comp for 415 purposes when contributionis made), or may the prior calendar year be used?

One of my clients told me all of his employees were hired by a HR company, and he now leases them, as of 6/1/2002.

These employees are still in the same job, still in the same place, so they are not considered terminated for distribution purposes, right?

If my client decides to make a contribution to the profit sharing plan, will he have to include his "former" employees?

Company wants to set up a safe harbor 401(k) plan for all non-union employees and a separate regular 401(k) plan for the union employees. Is it permissible to provide safe harbor contributions to non-union employees and subject the union employees to 401(k) testing since they would not receive any safe harbor contributions. Technically if there are no HCE's the union plan will anyway pass the 401(k) test. Also am I right that the 401(m) test is not needed on a union plan?

I know when you have one plan only Notice 98-52 allows you to disaggregate union vs non-union employees and provide the safe harbor contribution only to non-union employees and be non safe harbor for the union plan. Is the same reasoning true if they had separate plans one for union and one for non-union employees.

Thank you for your help.

Employer (A) has a plan that they have maintained for many years for their employees. In 2002, they acquired (stock acquisition) another company (B) that did not sponsor any retirement plans. Company B employees will not commence participation in A's retirement plan until 2004 (when the transition rule expires).

Can anyone craft an argument that vesting service for B's employees is not required to be counted before 2004?

I can get to starting vesting service at the date of acquisition but can't get to a later date. Thank you for your help.

We have a 2-participant (one owner, one employee) DB plan that is terminating as of December 31, 2002 and is under funded, but the owner has signed a waiver of his benefits. In the meantime, we need to prepare a January 1, 2002 valuation with the goal of $0 contribution for 2002. With the decline in asset values this plan has experienced, the goal appears to be impossible to obtain.

From a practical standpoint, there is no advantage for the employer to make a contribution because the company is no longer profitable and so would not get a tax benefit, and no disadvantage to the only employee if no contribution was made.

Is there an alternative method for avoiding a plan contribution in this situation?

Pursuant to an SAR, a participant is requesting the full annual report. Do you give them the Schedule SSA that has social security numbers and account balances of terminated participants?

Hello

I work for a TPA and I am creating a feedback questionnaire which we will send out with our annual reports. I am wondering if anyone else does this and how your return is on these. Also looking for ideas on what to ask. This is to get feedback on quality of our services, etc.

thanks a lot

Lisa

Based upon informal IRS guidance, we know that 401(a)(17) does not prevent elective deferrals on compensation in excess of $200,000. My question relates to the application of 401(a)(17) to the calculation of a matching contribution. Assume that the plan provides that the match shall be equal to 50% of the first 4% of elective deferrals (expressed as a percentage of Plan Compensation). The plan clearly provides that for all purposes other than determining elective deferrals, Plan Compensation is subject to the 401(a)(17) limit. Assume, for the sake of simplicity, that the match is determined on an annual basis.

An employee with an annual Plan Compensation of $300,000 defers at a constant 4% rate throughout the plan year. 4% of $300,000 is $12,000. Under one interpretation, the employee is entitled to a $6,000 match (50% of his elective deferrals up to 4% of Plan Compensation). This interpretation assumes that when calculating the deferral percentage subject to the match, you need not apply the 401(a)(17) limit (i.e., $12,000 is 4% of $300,000).

On the other hand, since we are calculating a matching contribution, I am wondering if the 401(a)(17) limit should be applied to limit Plan Compensation in the matching formula to $200,000. Under this interpretation, the employee is entitled to a $4,000 match. This assumes that when calculating the deferral percentage subject to the match the 401(a)(17) limit applies ($12,000 is 6% of $200,000). The first 4% of Plan Compensation limited to $200,000 is $8,000, resulting in a $4,000 match.

Any thoughts on which is the proper intrepretation?

My client just called to tell me the 5500 he mailed on the 7/15 extended deadline was just returned to him for insufficient postage. Apparently an error occurred with the postage meter that day. He has proof he sent it on the deadline.

Should he turn around and resubmit and save documentation of original filing and subsequent for notice that will be received later?

Should he try to send documentation and explanation along with filing now?

Should he use the Deliquent Filer Program?

In a top heavy DC plan, am I correct in saying that if a 3% contribution is given to the non-key employees, then the key employees can defer the plan maximum, maximum per prior year NHCE %, or the yearly maximum of 12,000 whichever is less?

I have a client who has been advised to name the company itself as the qualified plan trustee. I'm looking for the pros and cons for doing this. Do you know where I can find any articles that address this issue? Your comments are appreciated.

PSP wants to amend and no longer allow life insurance as investment option. They want to have policies in effect currently removed as well as no longer allow purchase of new policies. Would this violate 411(d)(6). I don't see that the insurance would be a protected benefit but I want to be certain.

I have $2250 in a Roth IRA that is 4-5 yrs old (not sure when it'll be five years old ). I started this at $2500 so it has lost a little money.

I will be doing a 1 year Masters program starting this September and I have to pay the first semester bill in August. I would like to use the $2250 from the ROth to pay the part of the tuition that isn't already covered by grants and loans.

Can I avoid both tax (this seems like it should be easy given that my principle has gone down and the money originally came from a contribution not a rollover) and also penalty (not sure on this one?)

So, to avoid tax and penalties, do I have to have the Roth account make the check directly to the school? Or how do I have to show that the money is used for my education? Is there a certain procedure or paperwork to demonstrate this?

THANKS!!

We have just discovered that for one of our plans, the 1999 5500 filing did not have a Schedule P at all, and the 2000 and 2001 filings had a Schedule P from the wrong Trustee.

It seems to me that we should file amended returns for all three years--that it is not very much work, and we want to get the statute of limitations started for all three years.

Comments?

RCK

Anyone have any thoughts on whether someone who was a named beneficiary for life insurance but then later removed as a beneficiary (by the insured prior to his death) has a right to know who the life insurance benefit was paid to? Any privacy concerns? Thanks.

Forgive me for not posting in the plan termination forum but this forum seems to be more active. I have an non-PBGC covered plan where the employer wants to terminate and pay out only "to the extent funded". I'm aware of the need to allocate asets under PBGC priority categories under ERISA 4044, and IRC 411(d)(3) and Rev. Ruling 80-229 have comments on the subject I believe, but I'm still a little unsure if a participant elects an annuity (vs. lump sum to extent funded) is the plan only obligated to use the priority amounts allocated under ERISA 4044 to purchase as much of an annuity as the priority categories can buy ? or is the annuity benefit a protected 411(d)(6) benefit and only the lump sum is eligible for a reduced payout ? Thanks in advance for any thoughts or opinions on the matter.