I am a teacher in the state of Kansas. Kansas offers KPERS a required defined-benefit retirement plan. Required member contribution is 4% of salary with a state match. I would like to contribute more. Am I eligable for a 403(b) plan as well since I have no control over my KPERS plan?

Is a Non-ERISA 403(b) required to draft a legal plan document and SPD since there are not testing requirements or IRS/DOL filings?

thanks, joe

We have a client that is proposing to offer qualified beneficiaries the option to extend their coverage period to the last day of the current plan year, with a maximum benefit equal to such participant's balance as of the participant's termination date. The participant will pay a one-time premium for this election. In addition to electing COBRA coverage and paying for it for the remainder of the current plan year, this other option provides that participants may use the available balance in his or her account as of his or her date of termination if he or she contributions $1.00. Such participant is not permitted to contribute any additional funds to the plan but is able to utilize the balance of his or her account until the end of the plan year. I have been unable to find anything that would prevent this option, does anybody have any thoughts?

An employer fired an employee for embezzlement, criminal charges are pending. The employer would like to be reimbused for the stolen funds from the employees 401(k) plan balance. It is my understanding that this cannot be done. Am I right??

We have a client that is proposing to offer qualified beneficiaries the option to extend their coverage period to the last day of the current plan year, with a maximum benefit equal to such participant's FSA balance as of the participant's termination date. The participant will be a one-time premium for this election. I have been unable to find anything that would prevent this option, does anybody have any thoughts? In addition to electing COBRA coverage and paying for it for the remainder of the current plan year, this other option provides that participants may use the available balance in his or her account as of his or her date of termination if he or she contributions $1.00. Such participant is not permitted to contribute any additional funds to the plan.

Does anyone have a comment on the eligibility of a hearing aid remote control being eligible for reimbursement under a Medical Care spending account? We think no, on the basis that it appears to be a convenience item, rather than a necessity item. Should we request a doctors note, or request the claim be submitted to insurance first (they have an HMO)?

Can an employer pay the income tax for the HCEs when they receive a corrective distribution as a result of the correction of an ADP test without violating an nondiscrimination rules? The employer plans to do a true up to pay for the additional tax on the payment of the tax, etc.

I want to amend a plan to a new comp effective 1/1/03. The plan has a last day requirement but no service requirement. Can they do it? I thought the last day requirement would allow for a change in the allocation.

I am trying to look for resources that would give me some information on some of the choices a PSponsor has when they choose to allow a EE to opt out of their medical plan. Can the ER in turn make a contribution to the 401k Profit sharing plan in return? How is this type of contribution typically identified? QNEC, Discretionary....help

Q&A 11(a)(4)(ii) of the final 204(h) Notice regulations says that illustrative examples are required for any change that results in a wear-away period. I'm taking "illustrative" to mean numerical. But Example 2 only gives a verbal description which is deemed to satisfy the requirements of Q&A 11(a). Is there a conflict between the two sections?

One of our clients is 100% owned by a Non-Profit Trade Association. The association consists of approximately 280 member companies. Would the controlled group rules apply to this type of organization? If so, how would the rules be applied?

Does anyone have a link to IRC 416(g)(4)(H) ? When I use the IRC link, it is not there.

The questions I am trying to answer in regards to non top heavy safe harbor 401(k) plans are as follows:

1) if the Plan document has a discretionary P/S formula, but ER does not ever intend to make a contribution, does that qualify as a Plan consisting solely of a safe harbor 401(k) arrangement?

2) Can the matching contribution be discretionary, and therefore can there be zero matching for some years?

It appears to me that health reimbursement arrangements (or employer-funded flex plans) are subject to HIPAA. This is inconvenient, especially to those flex plan administrators who are used to not having to provide a certificate of creditable coverage to terminating employees relative to their participation in the employer's flex plan.

The relief granted under DOL's Technical Release No. 97-01 clearly does not apply.

1. Is there another way out of this requirement?

2. Is one certificate of creditable coverage (from the primary health plan) sufficient to meet HIPAA's requirement, or must each plan provide such a certificate?

3. Can the certificate be provided on request only, since the HRA (or flex arrangement) is secondary coverage?

4. Can such a certificate of coverage be used to trick a subsequent employer or insurance company into waiving pre-existing conditions even though the employee wasn't really covered under a group-health plan but merely given an allowance to cover OOP medical expenses up to a certain level?

[Note: I am also posting this under health plans - HIPAA.]

It appears to me that health reimbursement arrangements (or employer-funded flex plans) are subject to HIPAA. This is inconvenient, especially to those flex plan administrators who are used to not having to provide a certificate of creditable coverage to terminating employees relative to their participation in the employer's flex plan.

The relief granted under DOL's Technical Release No. 97-01 clearly does not apply.

1. Is there another way out of this requirement?

2. Is one certificate of creditable coverage (from the primary health plan) sufficient to meet HIPAA's requirement, or must each plan provide such a certificate?

3. Can the certificate be provided on request only, since the HRA (or flex arrangement) is secondary coverage?

4. Can such a certificate of coverage be used to trick a subsequent employer or insurance company into waiving pre-existing conditions even though the employee wasn't really covered under a group-health plan but merely given an allowance to cover OOP medical expenses up to a certain level?

[Note: I am also posting this under flex plans as it seems to have a wider audience.]

A calendar year plan that terminated in 2002 obviously needs to be amended for both GUST and EGTRRA. This plan has a timely signed certification of intent to adopt a VS plan.

For ongoing plans yet to have their document restated, they would have to either adopt a word-for-word document or apply for a determination letter. That much I know.

But for this terminating plan, can they simply do "slap-on" amendments and not a document restatement at this time? Would they have to apply for a determination letter to get the extended time to adopt the GUST amendments? I feel comfortable that a terminating plan that did a complete document restatement would be in the same boat as the ongoing plan I described in the second paragraph, so my focus is on a terminating plan that just does a "slap-on".

I think the answers to my own questions are yes and no. I believe the "slap-on" amendments are acceptable and since they are standard amendments without a need to modify them, it's as if they are "word-for-word" amendments and the determination letter need is avoided.

I am less than sure, so please respond.

Employee terminated on 4/28/03

Benefits being covered until 5/30/03

Employee turns 65 on 5/2/03

Has spouse who turns 65 on 7/19/03

Spouse has a QE on the day husband turns 65?

Employee has a QE on the last day of coverage?

Then spouse becomes a multiple qualifyer on that last day of coverage?

--- does that make her eligible for extended months?

--- what about when she turns 65 two months later?

I'm not quite sure how to handle this one, I'm confused.

If a plan is using, say, a 6% valuation rate for funding purposes, can one justify using, say, 7.5% for determining the vested benefit liability for withdrawal liability purposes?

How could one justify using a higher rate for the latter purpose? One possible argument may be that there is built in conservatism in the funding val rate.

Any thoughts would be helpful.

ABC Plan has a fiscal year 5/1-4/30. Plan entry requires 21 & 1. Currently entry dates for all contribution sources are 5/1 & 11/1. ABC Co. wants to keep entry dates for profit sharing at 5/1 & 11/1, but wants to change the entry dates for 401(k) to 7/1 & 1/1. I don't see any reason they can't do this, but for some reason I gotta feeling that this will create a problem that I am just missing.

Does anybody see any issue with this?

Thanks in advance for any guidance.

A cafeteria plan excludes changes in employment status from qualifying events for purposes of mid-year election changes.

Is the exclusion of changes in employment status from qualifying events for purposes of mid-year election changes permitted? I think it is.

A participant terminates employment, then marries, then is rehired by the employer.

The participant maintians that the marriage is a qualifying event for an election change.

I tend to agree, as the change is being made on account of the marriage, not the rehiring.

Any comments would be appreciated.

For tax year 2003, are we required to generate a Form 5498 for Immediate Annuities that are Individual Retirement Annuities?

Thanks