I'm hoping someone can help me. I'm brand new to the DB world and have a tax question:

Is the lump sum portion earned after January 1, 1994 of a distribution subject to Social Security and Medicare taxes?

I know the answer is here somewhere--I just can't find it!

Thanks in advance!

I could use some help with this one.....

Company A is owned 100% by Husband. Wife and son both work there. Husband get a divorce from wife and she continues working at Company A (why, I do not know) with son and ex-husband. Is she a highly comp employee after the divorce???

Any help would be appreciated.....

Carson

Here are the questions I have regarding assumptions used by multiemployer pension plans when they determine employer withdrawal liability.

1. How are the interest and mortality assumptions chosen? Is the interest rate generally tied to some index so that it "floats" as interest rates float? Or are interest rates fixed and changed periodically to reflect the current interest climate? I would suspect that the mortality table is fixed and changed periodically as needed, but would like imput on that also. Are the assumptions used to determine withdrawal liability typically put in the plan document?

2. What value of assets is typically used to determine the value of unfunded vested benefits? Market value or the actuarial value used to fund the plan?

Thanks for any help you can offer!

I have a participant that received a hardship distribution for the purchase of primary residence. The financing of the home fell through. Is the participant required to return the money? If so, how is this accomplished (specifically, how are the tax withholdings handled?) If not required, is it an option for the participant to return the money if they would like? Again, if so, how is this accomplished?

Facts: Check has been cashed. 10% was withheld.

Can someone point me in the direction to find information on non-discrimination requirements for Health plans? I handle compliance for my employer's Profit Sharing and 401(k) Plans but know little about the requirements for Health plan.

I am specifically looking for information on the ability to exclude certain groups of employees from coverage or the ability to charge different premiums to different groups.

ERISA §§ 515 & 502(g)(2) cover collection, attorney's fees, etc. for multiemployer plans. Is there a similar provision for a MEWA? It is my understanding that becuase the MEWA is not Union, it is not a multiemployer plan and therefore 515 would not apply. Am I correct?

i moved to the US in Sept 2002 and am now living and working in the US and planning to take citizenship and stay here.

I am 46 and have work and contributed to a pension fund whilst in the UK. I have a transferable sum of about $80,000.

1. can i trasnfer this into a roth ira and then use a portion of it as a downpayment on a house?

2. do i have other options?

I am married to a US citizen and we both work. I have a 401K with my employer here which started in april.

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I am currently working with a school that operates within an indian reservation. Currently the teachers in that school are participating in the Tribes 401(k) plan. The school board wants begin a new and separate retirement plan for the teachers, a 403(b) contributory plan. Basically the employer will contribute 7.75% of salary if the employee does the same. The 401(k) guy is running interference by telling the tribal council that they will have to file a determination letter because of "multiple employer plans" according to IRC 7.11.1.2.1. Is there any truth to this, or is he just grabbing at straws? He also states that without IRS approval the tax exemption status of the Tribal 401(k) will be jeopardized. I also was wondering if the the school with have to file form 5500. I need some help to put the fires out.

My client is a calendar year corporation and the sponsor a Profit Sharing/401(k) Plan. They will be depositing $100,000, by their 9/15/03 corp filing deadline, representing a discretionary match on the employees 2002 401(k) deferrals. Can they deduct, if they so choose the $100,000 on their 2003 corporate return (vs their 2002 corp return) , even though it relates to the 2002 plan year? Assume the $100,000 is below 25% of eligible comp for 2002 and 2003.

Before I get into trouble for mis- advising the client, I thought I will check my opinion.

I am looking at a DB plan sponsored by a pet hospital (a corp. by Veterinarians) - I think they are a "Professional Service Employer"?

Veterinarians are not listed in ERISA 4021©(2)(B) - hence the question. Do they qualify as licensed practitioners of the healing arts?

Assuming they are a "Professional Service Employer".

The # of participants in the DB plan just went above 25. Now the plan is definitely a PBGC covered plan?

The reason for the caution: Once the plan is PBGC covered it will remain covered even if the # of participants is 25 or less and will have to go through the PBGC termination process when the time comes (unless the only reamining participants are "substantial owners).

TIA.

The two owners of a real estate investment banking firm have been investing their self-directed plan assets in real estate limited partnerships underwritten by their company. The investment opportunity is not available to other participants as they are not yet "accredited investors".

1. In this case it it OK for them to do this given that other employees do not currently have access? and

2. Are their any other issues of which the plan sponsor should be aware?

Thanks.

Here are the questions I have regarding assumptions used by multiemployer pension plans when they determine employer withdrawal liability.

1. How are the interest and mortality assumptions chosen? Is the interest rate generally tied to some index so that it "floats" as interest rates float? Or are interest rates fixed and changed periodically to reflect the current interest climate? I would suspect that the mortality table is fixed and changed periodically as needed, but would like imput on that also. Are the assumptions used to determine withdrawal liability typically put in the plan document?

2. What value of assets is typically used to determine the value of unfunded vested benefits? Market value or the actuarial value used to fund the plan?

Thanks for any help you can offer!

I am beginning to work on testing for a company with multiple divisions, each with their own ps contribution rate. There are also a couple of controlled group companies that I need to include.

Does this set up need to be cross tested or can I test the different ps rates in a different manner?

Thanks

A client is in Chapter 11. The buyer is going to assume COBRA liability. Is the buyer obligated under COBRA regs to maintain the same benefit plan design for COBRA beneficiaries or can they move COBRA beneficiaries to the new plan that will be offered? Can they modify COBRA rates under these circumstances even if it has been less than a year since the last premium change for COBRA beneficiaries?

I've got a Parent/subsidiary controlled group. Two employers A & B; each maintain its own Plan. B can't pass coverage on its own, so we aggregate. Now here is my problem, since I aggregate for coverage, I've got to aggregate for ADP/ACP. A uses current year testing; B uses prior year testing. Can B retroactively be amended to use current year?

I am merging a 401(k) plan sponsored by one member of a controlled group (Plan #1) into another 401(k) plan within the group (Plan #2). The merger is occurring mid-year, and Plan #2 will be the plan surviving the merger. Certain participants in Plan #1 (which does not have a matching contribution) have already reached their 402(g) limit for the year. Can we provide in Plan #2 for matching contributions on deferrals made to Plan #1? Matching contributions in Plan #2 are made on an annual basis. The plans are not aggregated for ADP/ACP testing purposes. Regulations 1.401(m)-1(f)(12) appears to say that a match can be made with respect to deferrals made to another qualified plan maintained by the "employer." The two employers in this case are an "employer" for purposes of Code Section 414(b). Subparagraph (ii) of that regulation, by negative implication, supports this interpretation.

This question is not related to my previous post from earlier today...

FACTS:

Employer offers group medical plan coverage. Employer also has a 125 plan that allow employees to pay for medical via pre-tax salary reduction. One of the employees has a son that is no longer a full-time student, but is a dependent. COBRA is offered to the child, due to loss of coverage.

QUESTION:

Can the employee pay the COBRA premium with pre-tax dollars (thorugh the 125 plan)?

Are there code sections you can refer me to?

Thanks again.

I have a question regarding treatment of rollovers when doing top heavy testing. Now that EGTRRA permits greater portability, I'm not positive about the treatment of rollovers from certain plans as to whether they should be included as "related" or not. Assume you have a PS plan, and consider whether rollovers into that PS plan from each plan type below, maintained by the same employer should be included. Would appreciate any opinions.

1. A SEP. I would say yes, based upon 416(i)(6).

2. SIMPLES. I'm not positive on these. I would say no, but I can't find any definitive statutory treatment. Since I can't find any statutory or regulatory language similar to 416(i) for SEPS, (nor under 408(p)) I'd assume no.

3. 403(b). I'm a litle confused by this. I believe that if there are EMPLOYER contributions, as opposed to deferrals only, that the employer contribution portion would be included in the required aggregation group under 416(g), and therefore a rollover from this portion would be included. But deferral portions would not. This is moot on a personal level, since we never have plans where the same or related employer maintains a 403(b), but I'd still like to know the answer.

4. 457's. No.

Appreciate your thoughts!

A terminated plan adopts slap-on amendments for GUST, rather than a full document restatement. Does this plan have to be submitted on Form 5310 or can Form 5307 be used? The client is just looking to meet the requirements of being a timely amender for GUST, not for a full-on termination review.