The 100% owner of a small Company died in 2002.

The 2001 ADP testing was not completed before death occurred.

2001 test fails and refund to deceased HCE has not been made yet.

New owner of Company is setting up new plan for 2003 and merging old plan into new plan.

Should 2001 refund be made to HCE's beneficiary?

Should a one-to-one correction be made to the prior plan before merging with new plan?

As we prepare for Monday, I have a HIPAA question for which I have received conflicting information. Do I need to update my SPD with the entire Privacy Notice or can I use just a summary? We are doing it on line and will be finishing it today. My plan was to use a summary piece but I have heard otherwise from other employers at a recent benefits gathering.

Thanks.

Situation: terminated DB plan now with only inactive employees has been funded under the individual aggregate funding method. The liabilities exceed the assets. My first question is how is this a reasonable funding method when there is no methodology over which to spread the PVFNC? Would you consider no normal cost reasonable?

That being said, I don't see that I have the option to change funding methods pursuant to section 4.02 of Rev. Proc. 2000-40. The PVAB exceeds the assets as of the date of plan termination.

I am looking for recommendations and thoughts.

If a participant requests a 5-year loan, when does the 5-year clock start to run, (a) from the date the participant signs the promissory note; (b) the date the participant gets the check; or © the date the employer begins deducting repayments from the employee's payroll?

Is it ok to set up a 20 year internal loan (loan between the ESOP and the company) with a 0% interest rate?

The issue is 404 deduction limit and having no interest would be helpful.

I was also wondering if it is ok because the net result of a 20 year loan with 0% interest would be a principal only release method.

Are there any model QMCSO Procedures available? I have no idea where to start with this.

Does anyone have a sample letter they use when they issue two checks to the same participant?

In the year 2000 I made a $2000 contribution to my Roth IRA. Only at tax time did I realize this would be classified as an an "excess contribution". Unfortunately, I dragged my feet and have still not removed the contribution. I want to remove it now but the value of the investment has declined substantially to the the point where there is not $2000 to withdraw.

In a non-retirement investment I would simply sell the fund and take a capital loss. The big question is how do I undo the effects of my original $2000 contribution when there is no longer $2000 in the account. How much do I withdraw? Can I take a capital loss? How do I deal with this on my 2002 tax return?

Adding to the complexity is the fact that the excess contribution was made to a Roth IRA that already has money from a prior year. How do I seperate the excess contribution from the original contributions when the whole thing has gone down the tubes.

Your help is appreciated.

Allan

I know HRAs can reimburse medical insurance premiums as defined under Section 213(d)(1)(D). But if the premium is paid pre-tax, would it be excluded from reimbursement?

Thanks.

I've sent several SS-$ applications to the IRS for Trust ID numbers, and one was kicked back asking for the SSN of the trustee. Is that required?

Excerpt: "Mobile phone companies are making a last stand to block a regulation that would allow subscribers to keep their telephone numbers when they switch wireless carriers."

http://www.washingtonpost.com/wp-dyn/artic...4-2003Apr8.html

I'm looking for PBGC interest rates (graded and immedidate) for 1984. The PBGC website seems to go back to 1993. Anyone know of an online source for years prior?

I am having trouble defining “plan” as it relates to the HIPAA privacy rules. If I have a health plan, dental plan and vision plan, do I have 3 plans each of which needs to meet the 5 million dollar threshold to be considered “large?” Or, are these plans viewed collectively as a “benefit plan” and I should total all of the gross receipts for all plans together to determine if we are over/under 5 million? In a nutshell, I don’t know if we are large or small, but I figure I still have 4 days to comply, so I’m not worried … I’m just having a nervous breakdown. Ahhhh!!!

I'm not getting the e-mail notification of new posts to threads in which I have posted. Does that feature still exist? Is there something else I must do now to get those notifictaions?

Has anyone seen anything with respect to whether compensation prior to the effective date of a SIMPLE IRA could be ignored? Or should total calendar compensation be used regardless of when the plan becomes effective?

Here's an interesting problem. If a company has a fully-insured plan and during enrollment, someone discloses certain medical information about themselves, how should the plan respond? I would presume that the mere fact that someone voluntary discloses medical information about themselves should not automatically require the plan to comply with all of hipaa's administrative requirements. And, if the the plan is using a broker, and the plan only gives enrollment information to the broker, which is still PHI, then then presumably the plan and the broker would have to enter into a business associate agreement.

Any thoughts?

I seem to recall that at either an ASPA or EA conference pre-1999, something akin to the following was asked at the IRS Q & A session:

In the absence of regulations, how will the IRS define "reasonable error" for the purpose of 1.415-6(b)(6)?

The answer was something like "very loosely". I sure wish I could get my hands on that Q & A if anyone has it.

My 16 year old had a $2200 income. Can I start a ROTH IRA for her?

Employer wants to exclude a class of HCEs from the ESOP plan or any DC plan for that matter (this class of HCEs has suggested this) from receiving employer contributions for one year. These HCEs are already eligible participants. It is my understanding you can amend the plan for an employment classification exclusion as long as you can pass the coverage requirements under 410(b). Since your discriminating against HCEs, there will be no problem passing the coverage testing. Any issues with this?

I have a plan that has been using the same interest rate for years... it has never changed. In addition, half of the amount being paid as interest is going to the Plan Administrator as a loan fee. (Example: a $10,000 loan repayable over 5 years at an interest rate of 10%. Total interest over the loan is $2748.20. So, loan fees are 1374.10 - just under $275 a year). [Please forgive my math if it's not accurate... you get the idea, though]

1. I'm concerned that the loan fees are too high for the administration of the loan and that the Plan Administrator cannot substantiate the cost, leading to a prohibited transaction.

2. I'm concerned that the interest rate never changing will result in a prohibited transaction.

Any thoughts out there?