Are receivables due an MD considered comp for calculation purposes, after MD has left the practice?

:confused:

We currently have a client that wants to set up ESOP deductions through our payroll. We've been having trouble trying to get answers to our questions:

Does the employer also make contributions to the ESOP plan? If so, where does this show on the W2? What line?

If not, where do the EE contributions go on the W2?

The client tells us that the W2 for 2001 included both 401K contributions as well as ESOP contributions on line 12(a) of the W2.

I'd like an expert to confirm this question.

Thanks for your responses.

First, let me predicate my question with this...

My experience is with retirement plans, so this Health, Welfare, and Fringe benefit stuff is extremely irritating with it's "do this, unless this or this occurs. If that is the case then stand on one leg, rub your tummy and your head in opposite directions" approach.

That being said...My client terminated a Life Insurance plan, employer paid premiums-fully insured, back in May of 2000. Unfortunately, my predecessor failed to file a final 5500 for the plan with no notes or paperwork on why it was not filed. Obviously I can't use late software excuse or really any other valid reason for late filing. However, it was a small plan (fewer than 100 participants) so will I have any leniency from IRS/DOL in this regard? At it's heighth the premiums paid (non-experienced rated contract- whatever that is!) were only $5,000 so DFVC would be bitter pill to swallow.

What options do I have here?

Better yet, do I have to file the termination filing at all? Was my predecessor correct to begin with?

I've searched all the threads and didn't see any information about the change EGTRRA made to using "includible compensation" when calculating 415 limits. My EGTRRA book from RIA indicates that for purposes of determining the limits on contributions you must use includible compensation. If you look at old versions of the ERISA Outline Book or 403(B) Answer book they say to use 415 compensation but the updated version say to use includible compensation. I've checked a few 403(B) plan documents provided by several name brand providers in the 403(B) market, and although they claim their plans were updated for EGTRRA, they do not reference includible compensation for the calculation of 415 limits. Is it because this change is insignificant? What am I missing? Why isn't this an issue people have discussed?

Chuck, have you updated your software to take this into consideration?

Thanks!

Is it possible for an S-Corp to contribute to all participating employees' SEP accounts, but exclude the officer's?

Can the effective date of a restated GUST prototype document be later than 1/1/02? My impression is that as long as the document is signed in a timely manner, the effective can be post- 1/1/02. We will be using a "snap-on" schedule for the document to show the effective date of different provisions.

Thanks

Client's previous TPA had them file Form 5500 for the 2001 Plan year using an incorrect participant count of less than 100 participants. This was the Plan's first year, and the plan was effective 1/1/01. Through conversations with the client, it has become apparent that they did not report part-timers to their former TPA, even though the plan eligibility requirements allow part-timers to participate.

If the client had reported part-timers, the BOY participant count would have been over 100, the Plan would have filed as a large plan, and an audit would have been required.

Is anyone aware of the penalties associated with having an audit done and filing an amended return reporting the correct figures?

Thanks for your thoughts and your time.

Former employee has an outstanding participant loan. Promissory note states that loan shall be repaid via payroll deductions. Loan is silent re. what happens when a participant terminates employment. Loan policy states that repayments must be made by payroll deductions. Loan policy similarly silent re. terminated participants. Plan document states that loans will be made to participants and beneficiaries on a reasonably equivalent basis. Any ideas on whether the plan can/must allow the terminated employee to make repayments, or whether the plan can/must call the loan and demand payment in full, now that participant is no longer employed.

My company is an S-corp. The owner receives wages in addition to retainage. The information I have on HRAs seem to indicate that the owner is eligible for inclusion, but it seems that it could easily be taken advantage of by the owner/employer. What am I missing?

Could someone explain the difference between a Medical Savings Account and the new Health Reimbursement Accounts. With an employer who currently payroll deducts for employee coverage, to implement an HRA, the employer would have to eliminate payroll deductions and raise the deductible. For example current deductible is $400 with 80%/20% coinsurance, the employer would raise the deductible to $1,000. How would the employer (with 300 employees) cut costs unless all employees were healthy and did not use the full amount (this is unrealistic). Could someone provide an example of how an HRA would work.

Can a participant roll assets out of a 457 plan if they are still working for the same government, but not actively participating in the plan?

Probably a dumb question, but if I'm allowed to withdraw money from my Roth IRA to buy my first home, can I put it back so as to keep that years' Roth "alive", or is that money lost from my Roth account, never to be recovered?

We have a participant in our 401(k) plan who is over age 70 1/2 who will be receiving a RMD. What makes him unique for our plan is that he still has some post-tax contributions in his account.

So I've waded through code and proposed regs enough to be comfortable saying that those post tax contributions are included in determining the "entire interest" of the employee, and subject to RMD. But my question is whether, if he takes a distribution of those post-tax contributions, that distribution counts against the RMD.

I have gotten opinions on both sides of this already.

RCK

We are in the process of renewing our welfare benefits and are looking at Wausau as a TPA. Does anyone have any experience with this company?

I would appreciate an honest appraisal. Thanks

I have been asked by one of my clients to design a 401(k) style plan for their division in Canada. Does anybody know about Canadian Pension Law and what can be done to assist my client in attaining their goal?

Does Reg. Z apply to loans made to participants from qualified plans?

It seems to me I saw a news item this summer and now wish I could find it. As I recall it (perhaps wrongly), the article said there was some disagreement at IRS or DOL over whether mere payment of premiums through 125 for an individual health policy would be a sufficient employer connection to make the policy subject to HIPAA portablility and nondiscrimination. This was not specifically addressed in the HHS Insurance Bulletin 00-06, which is attached.

Has anyone seen anything on this lately?

We see some govermental money purchase plans with mandatory after-tax contributions.

What is the best way to make those mandatory contributions on a pre-tax basis? We were looking at the idea of a 457 plan to take the place of the employee contributions. Can they be mandatory in a 457 plan?

What other concerns should I be addressing?

Thank you for your time.

On the Form 5307, if line 2 is filled out, does that mean that a 2848 power of attorney is not necessary?

Also, for line 3a, the first 2 check boxes ask for dates. The first check box: "Enter 1 for initial Qualification - Date plan signed..." Do they want the date the restated document is signed or the date the original was signed.

Line 7d asks " Are there any "Other" boxes selected in the adoption agreement?" How should this be answered for a Volume Submitter document? The instructions say not to use N/A.

Thanks

We have an employee that wants to pay his daughter's COBRA payment out of his FSA. She is no longer eligible to be on our health plan - but he is still able to claim her for tax purposes.

I'm pretty confident that if it was his premium he could pay it out of his FSA - but what about his daughter?

Thanks.