I am helping an employer design a 125 plan with a cash option in lieu of benefits (paid as additional wages). The employer has asked whether or not they could give the employees who opt out a lump sum payment at the end of the year, instead of with each payroll. I cannot find anything which would not allow for this, but I want to make sure that my bases are covered. Does anyone know of any cite which provides clarification to this issue??

Are there specific guidelines from the DOL or other entities for the timing of processing and forwarding distributions (in this case for a 401(k)/PS plan).

Example 1: The timing between a participant submitting a termination form to their plan administrator, and the plan administrator completing the form and initiating the termination process with the record keeper

Example 2: The timing between the plan administrator receiving the check from the record keeper, and forwarding it on to the terminated participant.

Thanks in advance for your input.

Right now i have a paired program of a Money Purchase and Profit Sharing Keough. I have frozen the Profit sharing plan and opened a Solo 401k. Can you keep the money purchase plan and put in 10% then start a profit sharing plan with a safe harbor 3% contribution and 7% in the profit sharing ( since i am not incorp.) and also a 12000 salary defer. OR do I need to stop the money purchase plan. The reason why i would like to do this is because the money purchase plan is at Vanguard who do not have a solo 401K but I like their funds to invest in. Thanks.

I need answers,please. I'm 62 years old and 24

years with my company. Our ESOP started 1976. We have 5 plants. We are a private company, in New Jersey.I went on the internet to see if I could get an answer to a question. It turns out I have

a lot of questions, but no answers. I picked one question to get answered. DIVERSIFICATION? These, I.R.S., D.O.L., N.C.E.O.,ESOP Assoc., and other

web sites say, YES! I asked my company they say

no. I contacted the above agencies, I can't get

a yes from anyone.

Thank You

A COBRA participant has medical only coverage. He has been enrolled in his wife's dental plan. His wife retired and enrolled in a retiree plan. They both have dental under the retiree plan. He is now wanting to add dental coverage under COBRA saying that he has special enrollment rights because of the loss of the wife's active dental plan. Does anyone think this is a special enrollment event? I've read the regulations, but it's not clear to me.

This is killing me:

Facts - My 51 year-old father converted his Trad. IRA to a Roth on 3/1/99; elected 4-yr. spread starting on 1998 tax return; no additional contributions have been made since conversion.

Question: When can he start taking distributions w/o getting hit with the 10% early-withdrawal penalty? Is it 1/1/03 or 1/1/04? I ask because I don't know if the 5-yr. waiting period begins with (a) the first day of the year in which the conversion contribution is made or (B) the the first day of the tax year that the Roth IRA contribution relates to (being 1998).

Thanks,

- Ross McKinney

The proposed regs., at 1.457-4©(3)(v), state that an entity sponsoring more than one 457 plan must have the same normal retirement age under all the plans.

The State of Alabama sponsors a 457 plan that has a NRA of 60. All state employees, including employees of the Univ. of South Alabama, may contribute to the plan. Beginning 1/1/02, the University of South Alabama adopted a 457 plan for its employees, and uses a NRA of 65.

If the wording of the proposed regulation is adopted in final form, must the University's 457 plan change its NRA to 60?

Thanks,

Ken Davis

Univ. of South Alabama

Won't most adopters (assuming below the e/ee # threshhold) of volume submitter plans qualify for the exemption from the user fee requirement since the remedial amendment period has been extended to at least 9/30/03?

I have an interesting dilema and I'm not sure where I can find the answer.

A company has an Employer Funded Health FSA. Full contributions have been made to each participant's account for 2002. This situation is that one of the participant's has died. The spouse, as beneficiary, would like to continue the plan through the remainder of the year. The plan document indicates that the plan year ends 12/31 or when a participant terminates employment (in this case, the death would result in the termination of employment). My understanding is that COBRA applies to FSA as long as the company is bound by COBRA and there is a balance in the account exceeding the remaining premiums. Since the account is paid up with employer contributions, and there is a balance remaining, the two questions I have are: Does COBRA have to be offered or can the employer, at it's discretion, continue to reimburse for services through the end of the year? If COBRA must be offered, would the company have to determine the approximate amount that would be owed and have the beneficiary pay the employer that amount? Help!!

In Tuesday's USA Today is says: "In 2002 you can contribute up to $11,000.00 to a 401(k). If you're 50 or older, you can contribute up to $12,000.00, as long as your company allows catch-up contributions. If you earned more than $85,000 in 2001, you may not be able to contribute the maximum."

I am trying to think of an example of WHY making $85,000.00 in 2001 would impede your ability to max out you deferral in 2002, or even 2001 for that matter.

Please provide examples!

An employer wants to terminate their 401(k) plan and put a SIMPLE IRA in place. If the employer doesn't make any contributions to the 401(k) in 2003, can he establish the SIMPLE IRA in 2003?

This is a follow-up to the thread "Which governs, frozen accrued benefit or indexed 415 Dollar Limit?" posted on 4/30/2001 by David MacLennan.

The final entry to this thread (by sdolce) indicates that the amendment can (but need not) be written to freeze the benefit at the amount calculated prior to application of 415, and in this case future increases in the dollar limit will increase the frozen accrued benefit.

Do we still all agree on this or must the frozen accried benefit be the benefit after application of section 415?

And here is my question:

Suppose benefit accruals are frozen the end of the 2002 calendar plan year. The plan is not terminated.

Before application of 415, the participant's accrued benefit is $6,000/mo.

This participant has only 3 years of plan participation when the plan is frozen so his accrued benefit at that time is limited to 3/10 of the 415 dollar limit or $4,000.

Assuming this participant is still a full-time employee at the end of 2003, would his accrued benefit now be limited to 4/10 of the 415 dollar limit ($5,333.33)?

The question comes down to, what counts as a year of participation under 415(B)(5)(A). Can a participant earn a year of participation for 415(B)(5)(A) purposes after future accruals have been frozen. I suspect not.

Our Summary Plan Description does not mention a 6-month waiting period to restart contributions after taking a 401(k)hardship withdrawal. Our hardship withdrawal form, however, does mention the waiting period for safe harbor plans.

In reading our contract, I cannot find where it states whether or not we are safe harbor (obviously, I'm not well-versed on 401(k) contracts); but we do have an EGTRRA Amendment which states the amendment "is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and guidance issued thereunder."

Do plan designs exist that exempt participants from this waiting period?

Thanks!

term employee with less than 500 hours but has deferred. he/she should be included in ABPT even though excluded from general test?

Quantech users: is software doing correctly?

thanks

First time I have had to file a 5500 for a controlled group. I have one controlled group with every company adopting the same plan. Do I file one 5500 for the plan or a 5500 for each member of the controlled group?

Can a Sole Proprietor take a loan from a profit sharing plan?

Can an individual who is 76 rollover his IRA to a TIAA-CREF account assuming TIAA-CREF will accept the rollover? Assume that the required minimum distribution has been taken from the IRA before the rollover. Will the rollover supress all further required minimum distributions from the rollover account assuming that the individual continues to work for the TIAA-CREF employer?

LLC1 (taxed as a partnership) sponsors a cross-tested 401(k) plan. LLC2 (also taxed as a partnership) is a participating employer. The two LLCs are part of a group under common control.

LLC2 has only one employee. He earns compensation from LLC1 and LLC2. The CPA is asking me for the most advantageous was to structure his compensation/contributions in the two LLCs.

He earns more than the 401(a)(17) limit and will get an allocation of $40,000 in 2002.

Any ideas?

michele

I'm hoping to get some information regarding Group Term Life. I have key employees who have large policies that they company is the beneificiary of. Would the premiums for this insurance ( paid by the company ) be taxable to the employees?

thanks for your help......

Wanda