I am preparing a Schedule P for a plan with a plan year of 5/1/02 - 4/30/03.

The plan sponsor changed Trustees, effective April 30, 2003. Is the Trustee listed on the Schedule P as of the last day of the plan year? It would seem that they would want the former Trustee to sign, as they were Trustee for 364 out of the 365 plan year days.

Thanks.

Ok - I know this seems like a no-brainer, but every year I confuse myself. I have a client who failed the 2002 ADP test. 2 HCE took refunds, they were paid out by March 15, 2003. When I complete my 2002 form 5500; Schedule I, I use the actual total deferral deposits on the "participant contribution" line (2a(2)), which includes the excess. I believe the refund to be a liability of the plan, however if I put the amount in at the top(1b), the assets don't balance unless I reflect the corrective distribution on line 2f. I know that isn't right because I want to show the distribution on the 2003 5500 when it actually occured. How do others report this? Thanks in advance.

A participant takes out a hardship withdrawal and doesn't actually get the house. Can they return the money to the plan ? What are the ramifications of this issue? Thanks for all your help.

Can the COBRA premiums for an employee's spouse be reimbursed through the 125 plan?

A plan with numerous investment choices is wanting to change providers. Unfortunately they are in funds which have back end loads or deferred sales charges. The partricipants accounts are going to be charged deferred sales fees ranging from 1% to 5%. Each paritipant will have different % fees based on how long the money has been in the account. My question: Is there any method legally that the participants can be made whole by the employer? And how would that be done. The employer is willing to pay those fees but the fees will be taken from the participant's accounts and I am not sure how the employer 1) gets the money into the plan without it being considered a contribution and 2) can it be allocated based on what each participant is charged.

Does any other site besides Freeerisa.com have 5500 filings online? The site is down and I really need to find an old filing.

The husband of a participant in a PS 401k has signed a beneficiary form consenting that the participant may change her designated beneficiary without his consent.

Does this beneficiary form have any bearing if the couple divorce? Can the husband still obtain a QDRO on his wife's PS 401k balance?

I wasn't sure if when the husband signed the beneficiary form, he was giving up all rights to her money.

does someone know if Relius Administration version 6.0 will automatically see that two plans are of the same employer, and also see that the same key ee is in both. Will the system automatically aggregate plans for the top heavy test?

It seems that it would as the drop down list on both the top heavy plan specs and report contain "override" options.

I have a situation where same employer with same key has two plans. The system knows to agreggate plans for 415, but is not doing so for top heavy.

I know I can just go in and "override", but shouldn't it know to aggregate the plans?

I know...6.0 was moons ago, but I have no control over it. I hope we can upgrade soon.

Defined benefit pension plan buys group term life insurance policy providing retiree death benefit coverage for retirees at a fixed dollar monthly premium per $1,000 per retiree.

It is fairly clear that the cost of the life insurance coverage is taxed to retirees under 1.72-16. What is not clear is how the cost is calculated. Notice 2002-8 appears to provide that the cost is determined by the Table 2001 premiums or by insurer's lower published premium rates (satisfying the conditions of the Notice).

However, one publication states that for term insurance held by a qualified plan, it is not settled whether the cost is determined by the actual premium or the Table 2001 premium. Although not stated, I think the publication was considering 1.72-16(b)(2) and 1.72-16(b)(3).

1.72-16(b)(2) states that if employer contributions or earnings are used to buy a life insurance contract, the cost of the life insurance protection is included in the gross income of the participant. It makes no reference to how the cost of the life insurance protection is calculated.

1.72-16(b)(3) states that if death proceeds exceeds cash value, the excess is considered the life insurance protection and further states that the cost of such insurance will be considered to be the net premium cost as determined by the IRS.

Thus, 1.72-16(b)(3) provides that the cost of life insurance is determined by the IRS when there is a cash value, but 1.72-16(b)(2) does not. It may have been this difference that the publication was considering.

I would appreciate any comments.

Has anyone found a link to text version of the new COBRA model notices? It would be easier to update than to retype the whole thing from the Federal Register. But they show as image files in the text version so they don't show up.

Is an employee who terminated coverage eligible for COBRA, if he is 69 years old and enrolled in Medicare Part A at the time of termination?

It is my assumption that if the member elects COBRA then becomes Medicare eligible, it is at that time the COBRA benefits ceases.

One employer, two Plans:

The first Plan is a Profit Sharing Plan where the Key employees have over 60% of plan benefits, so Plan is Top Heavy (and has been for several years)

The second Plan is a new Money Purchase Plan where the keys do not have over 60% of plan benefits.

Is the second Plan automatically top heavy because the first plan is? Therefore, accelerated vesting apply for the second plan as well as the first plan.

Do I need to aggregate the two plans together for top heavy determination?

Both Plans pass the general non-discrimmination tests separately.

Any help would be appreciated. Where would I look this up?

Thanks

I reviewed several similar topics from the message boards that discuss top-heavy issues, but I have a slightly different twist.

The Employer sponsors a defined benefit pension plan. Accruals have been frozen. The Employer also sponsors a safe-harbor 401(k) plan. If the top-heavy minimums are provided through the 401(k) plan, which is the correct amount?

A) 5%

B) 3%

C) No top-heavy minimums are required.

So far, my research has me leaning toward "C", but I could also make arguments for "B".

I am a CFP practicing in northeast Ohio. A client of mine inquired about whether or not we could manage his 401k investments. Is it possible to directly deduct our fee for such services directly from his 401k account with some type of limited power of attorney. Thanks for your help.

What is the effect if a participant is in pay status and has elected to receive a joint and survivor annuity and his spouse dies before he does. If he later remarries is the new spouse now entitled to the survivor annuity or does the annuity die with the first spouse? Is there any authority on this point?

I've never had to file a Schedule C before and am trying to do it correctly the first time!

For this particular situation, no fees are paid from the plan (the employer pays the TPA and accountants for the audits out of their general assets).

So, do I not consider these on the Schedule C?

It seems to me that the only fees recorded are those that are paid from plan assets but am still unclear after reviewing the instructions and other guides.

If this is the case, do I just put 0 in line 1 or Part 1... and leave the rest blank?

On a side note, what if the plan uses forfeitures to pay for plan assets? Is that reported on the Schedule C?

Thanks,

Rachel

Company sponsors a "top-hat" NQDC plan for its executives. The plan is "funded" through the use of a Rabbi Trust. The Company finds it easier to make benefit payments under the NQDC plan via its payroll mechanism rather than directly out of the Rabbi Trust account (for which there is no real mechanism for benefit payments other than check writing by the Trustee). Logistically, the withholding obligation, etc. with respect to the NQDC benefit payments is much more efficient when done this way.

Does anyone see a problem with amending a Rabbi Trust to require the Trustee to reimburse the Company on a quarterly basis for NQDC plan benefits that the Company has itself already paid out during that quarter via its payroll mechanism?

Thanks.

Does the following satisfy ADP and ACP safe harbors-

Match of 200% on the first 4% of pay deferred?

Thanks

Question from a client: regarding the Dependent Care Spending Account. If the spouse of and employee does not work out of the home, are they still eligible for participating in the Dep care spending account? I think if she is a full-time student or disabled they would qualify. If they aren't eligible can they stop the current contributions and get their money back that they have been contributing?

Fully vested participant takes out DB plan loan, but ceases to make payments upon termination of employment. DB terminates shortly thereafter and merges with PS. Participant was told at the time that the outstanding loan would be deducted from the balance before the transfer. However, participant later learns that the defaulted loan was transferred to PS and continued to accrue interest until termination of PS 8 years later.

I heard that there is a rule or reg. somewhere that does not allow the transfer of a loan in default from one qualified plan to another. Is this correct, and if so, where can I find it?