How does one calculate the participant's PVAB in a cash balance plan in order to determine if the plan is top heavy?

I could see projecting the account balance to NRA, converting it to an annuity, and then determining a PVAB based on this annuity.

I can also envision just using the current account balances, since once we go through the steps of projecting, annuitizing, and calculating a discounted single sum, we are pretty much back were we started.

Is there any formal guidance on this topic?

Thanks.

Can anyone point me to the Regs that govern the reimbursement of expenses to trustees or other fiduciaries? Are per diems permitted? Are there any monetary limits to reimbursement?

The plan is a multiemployer plan, does this make a difference to the amount of and type of reimbursement permitted?

Thank you in advance for your help.

We use quantech, pentabs, and FDP in our TPA firm. We are upgrading our copier. According to the salesman, we should be able to print these software applications directly to the copier versus at the individual work stations. I hear they may be problems with FDP because it uses Word 97. Pentabs is a dos program.

Anyone out there printing directly to copiers versus printers? If yes, any problems?

Plan year-end is 12/31/02, what is the deadline for the profit sharing contribution to be made? If possible, please let me know via e-mail: scott.paterniani@gt.com

I have a 1 man plan who wants to purchase as part of plan assets real estate that's subject to a mortgage. What are the issues involved (prohibited trans, unrelated business income tax, etc)-how do you handle it?

Thanks

Regarding Sec 404(a)(6), timing of when contributions made/deducted: If cash-basis employer is calendar year and defined benefit plan had June 30 year-end, what year would deduction be accrued to?

For example: 12/31/02 employer year-end; 6/30/03 plan year-end. I would assume the accrual of the contribution for 6/30/03 would be on 12/31//02 corporate return since 6/30/03 is the 2002 tax form used. Or would it be 6/30/03 plan contribution accrues to 12/31/03?

If 6/03 would accrue to 12/31/02, then I would assume the plan contribution would still need to be made by 8.5 months (9/15/03) after 12/31 and not 6/30 (2/15/04).

Or, is the deduction governed by Reg § 1.404(a)-14©(1) and the employer can elect what year to take the deduction?

Is the compensation period an issue also? For example, if the 6/30/03 plan year contribution is "on account of" 12/31/02 compensation.

Thanks for any light you could shed on this issue for me.

I have an employer with a current 401(k) profit sharing plan. The employer wants to remove the 401(k) piece from their document since no employees are interested in participating. Does anyone have any idea how to go about doing so? Could I just restate the plan and not include the 401(k) provisions?

Participant was paid a distribution of:

$10,000 from 401(k) account.

$600 from match account (forfeited other $400).

$700 from profit sharing account (forfeited other $300).

When the participant is rehired and meets other requirements for buy-back, does the participant have the option of:

1) Repaying $600 to match account to have match account restored, but not repaying profit sharing account?

2) Repaying $1,300 to have both match and profit sharing restored?

Or is the only allowable option to repay $11,300 to 401(k), match and profit sharing to get the forfeited amounts restored?

Terminated ee had eligible medical expense incurred before termination but did not submit for reimbursement prior to termination. The expense exceeds terminated ee's contributions. Must the plan reimburse up to the annual coverage amount, or may the plan limit reimbursement to account balance (or not reimburse at all if plan terms permit).

Is it common practice to allow 401(k) deferrals to be taken on vacation payouts made at termination of employment? Can vacation payouts count towards final average pay and credited service in pension plans? If yes, what are the advantages and disadvantages?

Hello!

I am new to this area so please bear with me! I am working with a small company who, about one year ago, decided that it was going to merge the money purchase pension plan into the profit sharing plan. No amendment was signed to effectuate the merger and a section 204(h) notice was never given to the Participants. Instead, the MPP account was transferred into the PSP account. This is reflected, obviously, on the statements. I contacted the IRS on a "John Doe" basis. The agent said that if this truly is a merger and not a plan termination than an amendment to effectuate the merger can be done by September 30, 2003. However, I am also concerned that a 204(h) notice was not given out prior to the account being transferred. How do I correct this situation?

If an individually designed plan was adopted by 2-28-02, is the plan still required to submit for a determ letter by the 9-30-03 deadline? Thanks

If an individually designed plan was adopted by 2-28-02, is the plan still required to submit for a determ letter by the 9-30-03 deadline? Thanks

A married person living in a community property state designates an IRA beneficiary other than his/her spouse, and then dies. The spouse asserts a right to a portion of the IRA based on community property law. What options does the spouse have in dealing with his/her interest in the IRA?

He/she doesn't appear to be a "designated beneficiary" under 401(a)(9) and the regulations, so his/her options there should be the same as those of an estate -- continuing the decedent's distribution if death was after the required beginning date, or payout within 5 years if death was before the required beginning date.

Can he/she roll over to his/her own IRA? That doesn't depend on "designated beneficiary" status under 408(d)(3). Assuming ownership of the account under Treas. Reg. 1.408-8, on the other hand, appears to require designated beneficiary status.

I would appreciate any thoughts or comments.

It has been a while since I have been administering a 401(k) plan. Please help me rember if there are minimum hours that an employee must work in order to participate in the 401(k) plan. This plan has ee contributions only, no employer contributions, so vesting is not an issue. If there are minimum hours, is it 501? Thanks for any help.

Can anyone recommend any organization to provide TPA or trustee services for a VEBA?

can I establish an IRA for my 4yr old ? What are the penalties/tax consequences if I have to withdraw money in case of emergency ? What's the max that I can contribute per year/totally ?

Thanks,

PJ

(1) Though I don't recall where, I remember reading that with Roth IRA's, it wasn't a question of what you can invest within them, but of what you can't. So, what are the investment vehicles that can't be invested in Roth IRA's?

(2) How valuable is the ability to withdraw initial contributions to Roth IRA's? From what I've read, it appears that the withdrawal of contributions is not adjusted for inflation.

My question is in regard to Section 408(e)(2) of the Internal Revenue Code which concerns prohibited transactions with IRAs. Under Section 408(e)(2), it states that an IRA will become disqualified if the owner/creator or his or her beneficiary engages in a prohibited transaction with the IRA. My specific question is, when does a person become a "beneficiary" for this purpose (when named, when the creator/owner dies, or when benefits begin to be paid to the beneficiary)?

Treasury Regulation 1.408-2(b)(8) provides a definition for the term "beneficiary." Does such definition apply to 408(e)(2) and help to answer the question above?

Thank you for your help!

If you've got a few minutes, and are looking for inspiration, I highly recommend reading the description of the current leg of the Tour de France.

Go to the link below, click on up the "Newsflashes", scroll down to "14 H 22 - Situation At Base of Col d'Aspin", then read up. It'll probably take you 10 minutes or so to read, but I can't even begin to do it justice on my own.

http://www.letour.fr/2003/us/index.html