Is it too late to convert a traditional IRA to a Roth IRA for tax year 2002? I know you can add new money for tax year 2002 to a Roth prior to the 2002 tax filing deadline (April 15th) but is it also true for conversion?

How do you account for limited partnerships in which the statement is received on a quarterly basis when an account is certified on a monthly basis? Many of these statements received from the LP are on a one- to two-quarter lag, so I would like to know if you adjust for capital calls and return of capital when determining the price on a monthly basis (based on the last statement received).

May Qualified Match Contributions (QMACs) be used in satisfying top heavy minimums?

EGTRRA made changes so that match contributions can be used toward minimums without the problem of "can't be included in ACP" - does the same apply for QMACs? Can they be used toward TH minimum and still be used in ADP/ACP tests?

I am assuming they can, but can't find anything definite that states this.

Thanks in advance for your response!

The Final Loan Regs and the preamble seem to suggest that a plan has the option of suspending repayment during leave for military service, but is required to charge a rate of interest no greater than 6% during that leave.

Is this 6% requirement imposed even if the plan does not permit a suspension of payments during military service?

In two different sessions of the EA Meeting, Marty Pippins claimed the 120% corridor under JCWAA for 2002 and 2003 does not apply to 404 maximum calculations.

I don't agree. Section 404(a)(1)(D)(i) says "unfunded current liability determined under section 412(l)." The 120% rule is in 412(l)(7)©(iii) without any restriction to its use (it says it may be used "to determine current liability under this subsection"). It seems the reference from 404 should pick up this rate.

Anyone know why Marty was saying it is somehow restricted to the 105%?

When a MP plan is merged into a PS plan, what submission process would be used to get a determination letter on the MP plan? I would consider using the 5310 and submitting it as a plan termination, but it's not really that. Thoughts?

I have a top heavy 401(k) plan. The employer makes a matching contribution of 50% of deferrals up to $1,000. I want to apply the match towards the top heavy minimums for the non-key employees. It is my understanding that only the difference between the match and the 3% TH minimum needs to be contributed. There is one non-key whose match exceeds the 3% TH minimum. For simplicity let's say this individual's match is equal to 4% of their comp. Does this mean that each non-key employee will need to be allocated 4% of their comp.? How else could I justify one non-key employee having annual additions totaling 4% of their comp. when all the other non-keys are only getting 3%. Help!

What should plan do where participant took loan a while back and account balance used as security and now participant terminates employment when value of participant's account won't cover balance owing?

I would greatly appreciate if someone could explain the "phase out" limits on a Roth IRA for married/joint filer with income over $150k. I cannot find the formula in the Roth regs. Thanks

During 2002 I worked for two employers. I earned over $3,000 from each. One employer provided a 401k plan; the other had no deferred compensation plan or pension plan. Am I eligible to have a deductible IRA for 2002 (up to $3,000) because my second employer did not cover me under a deferred compensation plan/pension plan?

Husband and Wife opearte a Sole Prop business and file separate Sch Cs.

Total net Sch C for the business is $100k which is split 50/50. Therefore, net Sch C for each owner is $50k and 1/2 FICA is $3,500 (rounded for illustration). The sum of their Sch Cs less 1/2 FICA is $93,000.

Total plan cost is $90k say, which is less than the $93k in total Sch C less 1/2 FICA. Actuarially allocated costs are: $55k for husband and $35k for wife (computed individual costs under the Ind Agg method or allocated under the EAN or FIL methods using a reasonbale approach).

Scenario #1 - A joint income tax return is to be filed.

What can be deduced for the pension plan: full $90k or $81,500 (Husband's Sch C less 1/2 FICA of $46,500 plus $35k for the wife), carrying foward a loss of $8,500?

Scenario #2 - Separate income tax returns are to be filed.

What is the deduction for pension plan for each of them: $46,500 for husband and $35k for the wife or can the pension plan be split 50/50 and $45k deducted by each?

(they each have a higher Hi 3 average established in the past so current year eligible compensation does not affect the cost).

hello, my question is, can you have more than one roth IRA as long as your combined contributions do not exceed 3,000.00/ yr? this is for a married filing jointly annual income of 100,000.00/yr. any help woould be gladly accepted. thanks!

A participant in a tax-exempt 457(b) plan terminated employment in 2001 and elected to defer her distribution until 2005, when she reached age 65. In December 2002, she requested (and received) a partial payment of $32,000 to pay for a down payment on a house. Does this amount to a revocation of her initial election to defer her distribution and result in the all the amounts deferred under the plan being taxed because now they are "paid or made available"? Or is just the $32,000 taxed?

This just came in from company ready to start a 401k, I was wondering if you had an answer or know of a reference source. A small (engineering) company (s-corp) owned by several people (of which 2 are brothers), owners intend to create various LLP’s and corporations. Each company will be created to take a separate process/technology to market, with intent to limit liability exposure of original company from anything that might happen with the new processes/technology/companies in the future.

Ownership of the companies intends to be set up so that several will be considered under control group for purposes of the 401k plan benefits. (Each company will get its own 401k plan, identical benefits.)

The question is are there any laws or codes that could create a binding tie between the companies simply because they share 401(k) plan provisions under a control group? Have anyone seen this happen?

Thanks.

frankh@wellington401k.com

HIPAA deadlines are keyed to calendar days, no?

If anyone can provide a citation that would be appreciated.

The last post by lori recieved so much input, I thought I would run another scenario:

Owner of an S-corp, age 48

Income of $700,000

Projected income - $700,000 - $1,000,000 for the next 12 years. He owns a vary stable business that has become more profitable every year of operation.

20 full time employees - nobody anywhere near his income level

I understand the uncertainty associated with the legislation regarding 412(i), but what hurdles might this owner have to overcome based on income levels and number of employees.

Thank You for your input.

What are the typical options for taking a distribution from a non-governmental 457(b) plan? Is it possible to do a rollover to an IRA? Are the options different between governmental and non-governmental 457(b) plans?

I love the new format, but I can barely read the topic titles. Can you please enlarge those letters?

Thanks.

Facts - a profit sharing and 401(k) plan provides that distributions from the plan may only be taken in the form of lump sum distributions. The plan does not permit other forms of distributions (e.g., installments).

Question - how much, if anything, is the plan required to say about the application of the required minimum distribution rules under IRC Section 401(a)(9)? Regulation § 1.401(a)(9)-1 Q&A 3 specifies which provisions must be included in a plan to satisfy Section 401(a)(9), but I am not sure if these provisions are required by plans that only permit lump sum distributions.

If provisions regarding 401(a)(9) are required, does anyone have any suggested language?

Thank you.

Facts - a profit sharing and 401(k) plan provides that distributions from the plan may only be taken in the form of lump sum distributions. The plan does not permit other forms of distributions (e.g., installments).

Question - how much, if anything, is the plan required to say about the application of the required minimum distribution rules under IRC Section 401(a)(9)? Regulation § 1.401(a)(9)-1 Q&A 3 specifies which provisions must be included in a plan to satisfy Section 401(a)(9), but I am not sure if these provisions are required by plans that only permit lump sum distributions.

If provisions regarding 401(a)(9) are required, does anyone have any suggested language?

Thank you.