Is a 'rollover' allowed only one time into my Roth IRA, and out of my 457(B) government deferred comp plan?

I intend to continue employment and plan contributions with my state employer, and rollover again in the future to my private Roth.

Thanks for any suggestions.

--Ford

As a participant of a medical flex plan, am I obligated to pay back an employer if they terminate me and have already drained the flex account dry for the year.

Here is my situation... I plan to commit to $4,500 in my medical flex acct next year for dental (braces). Potentially my employer may eliminate my position Feb. '03. If I start my dental procedures in early January and pay the medical provider in full for their services and submit and receive the full reimbursment (thus draining the flex acct), would I have to pay back my employer for the approx. $4,000 in remaining uncollected contributions? Could they take it from my severance package?

Any guidance is much appreciated.... Thank you!

1 of our subsidiarys ceased operations late last year and they terminated fully insured medical coverage. They did not offer COBRA since the group health plan ceased to exist.

The sub is part of our controlled group but all of our subs operate as separate lines of business.

Were we required to offer COBRA coverage under 1 of our other subs health plans or are we exempt since SLOB under 414® of IRC?

I am considering setting up a Roth IRA account. I'm 19 years old, and would like to find out some information on if this would be a good idea. I have tried to read through this web site but haven't really been able to pick up on a lot of the details. If someone could explain the Roth IRA in laman's terms that would be great. Thanks.

We administer a plan that uses the elapsed time method to calculate vesting service, and excludes years prior to the plan establishment (1/1/1998) for vesting. Since the elapsed time method uses the Employment Commencement Date, when does a participant first receive a year of vesting service?

i.e. Employee is hired 7/1/96. Plan effective date is 1/1/98. Does the participant have one full year of vesting service on 1/1/99, or do they need to wait until 7/1/99 before they have a year of vesting service?

Situation: An employee is given a 90 introductory period during which no benefits are given. The introductory period of 90 days was extended an additional 30 days to see if the employee could meet the job requirements which he had not met in the first 90 days. After 90 days we are obligated to offer insurance and the employee elected to get the insurance. After the 30 day extension the employee is terminated as he could not meet the job requirements. He is notified that he can COBRA. He has 60 days to notify the employer on whether he wants to do this. The health plan agent has informed the employer that they will have to pay the premiums for this employee until he decides what he wants to do and that if he opts out the employer is out the premiums. Is this really the way it works? We are a small company and watch our budget closely. If we have to pay we will but it just doesn't seem fair.

A state teachers association has created a self-funded health plan. Almost all teachers in the association are employees of school districts, governmental entities. The plan is funded through a VEBA and permits all who share an employment-related common bond with teachers in the state to participate with the approval of the state teachers association. About 7.5% of participants are non-teacher working for schools or school districts. Approximately 2% of the teacher/participants work for private schools. About 92% of participants are as a result of collective bargaining agreements. The balance are employees of schools/districts that have a policy of matching benefits for non-union employees.

Because of their concerns about liability for negligent claim payment or review or for refusing benefits through their gatekeeper cost containment program, the association desires the plan to be an ERISA plan, thus limiting damage claims against them to those provided under ERISA rather than state law. A state court held several years ago (based on plan documentation) that the plan was an ERISA plan. However, it appears that under ERISA, to the extent that governmental employees participate in an otherwise ERISA plan, the plan as it applies to those governmental employees may not be an ERISA plan.

It appears that to the extent that the plan has private schools and non-union employees participating it may also be a MEWA. This could result in the result that with respect to the governmental employees the plan does provide ERISA protections and for the non-governmental employees the plan, although subject to ERISA, will need to be filed with and approved by the state's insurance department.

Is there any way to make sure that ERISA applies to such a group (and pre-empts state laws with respect to damages)? Will the DOL rule on ERISA applicability? Is there a flaw in my analysis or concerns?

I have a small takeover profit sharing plan (without a 401k/m option) that is top-heavy. The only monies deposited in the plan are used to pay the life insurance premiums for the key employee. Doesn’t this constitute a contribution and aren’t the non-keys required to receive their top-heavy minimum?

Don't you just love takeovers?

Does anyone have any experience with extending 457(B) plans that qualify as church plans (under 414(e)) to rank-and-file employees? What problems occur? What sort of participation can be expected?

I am attempting to restate a volume submitter plan document where Merrill Lynch and then BISYS was the recordkeeper.

Client had a major fire and no records prior to the 2001 testing are left with regard to current year/prior year.

BISYS has indicated that they have Merrill's 1999 records on current/year prior year but in 2000 Merrill had a fire and so the records for those years are unavailable. They have no clue for 1997 and 1998 even though they "pulled their box". (When they found out they had no info, they did agree to waive the $100 fee for pulling the box).

Anybody else dealt with this or a similar situation. Any solutions?

Has anyone heard anything about changes to the current regulations regarding the COBRA benefit as it applies to Health FSA's? One of my clients said they heard, that according to Title I of HIPAA, it was no longer required to offer the healthcare portion of an FSA under COBRA.

That's news to me. Any feedback would be greatly appreciated.

Thanks so much.

Is a key employee for a 2001 plan year test under Code 125(B)(2) determined under pre-EGTRRA provisions? For top-heavy determination for a plan year beginning 1/1/02, the key ee's on the determination date (12/31/01) are based upon the new EGTRRA rules and there is some confusion as to whether or not this applies to cafeteria plan testing.

Thoughts??

Can anyone give me some feedbak on 401K mid year audits ?

I need to confirm information regarding the Small Business Job Protection Act of 1996 and how it pertains to the audit ? As well as, which employees can be excluded from the testing based on hours worked, etc.. ?

Notice 2001-56 provides that if a plan uses annual compensation for periods prior to January 1, 2002 to determine accruals for a plan year that begins on or after January 1, 2002, the plan is permitted to apply the $200,000 EGTRRA limit for such prior periods in determining such accruals. The notice gives an example of how the retroactive application of Code Section 401(a)(17) can be used with a traditional formula plan with a benefit based on "high 3-year average compensation."

An employer's cash balance plan credits each participant on December 31 with 3% of the participant's compensation for the year. Can the $200,000 limit be applied retroactively for years prior to 2002?

Is it correct that the 100-participant threshold for DREC applicability is calculated based on all db plans maintained by an employer or members of a controlled group,rather than than the participant count of the particular plan for which the DREC might apply?

The 401(k) (deferral only) plan is not top heavy for the plan year ending 12/31/01. However, is top heavy for the 12/31/02 plan year end.

A top heavy minimum contribution of the lesser of 3% or highest allocation to Key EEs is required for the 2002 plan year.

Ok, here's the complicated part...

The ADP test is tested using prior year (nhce %) basis. In 2001 the NHCE ADP was 0%. Therefore, for 2002 the HCEs (which happens to be the only Key EEs) ADP should be 0%. Thereby, making the Top Heavy Minimum Contribution to NonKey EEs 0%.

The problem is that the HCEs (Keys) have been deferring all year (2002) and will require an ADP refund.

Do I have to take the ADP refund contribution into consideration when determining the Allocation received by Key EEs? OR can I say (after making refund) the Key EEs received $0 allocation?

Hi-

Employer maintains a dependent care flexible spending account. Employer anticipates failing the 55% test and decides to cut back all HCE's from $5,000 maximum deferral to $4,000.

HCE's spouse is employed by a different employer. Can HCE's spouse elect to increase her coverage under her employer's dependent care reimbursement account plan by the $1,000 lost under the HCE's plan?

This type of change would have to be showhorned into 1.125-4(f)(4). It doesn't seem to fit nicely. But the spouse's employer might argue that there has been a reduction in coverage in the HCE's plan (the change in the maximum permitted dependent care deferral/reimbursement), and the HCE has made a "deemed election" under the other employer's plan consistent with that reduction.

Anybody see this before? I haven't been able to find any IRS guidance.

Thanks.

r.

We have several plans which use insurance as an investment. The insurance policies are universal life so they allow variable premiums. We want to set up the insurance as an investment so that when a participant elects 25% to insurance the premium amount may vary with compensation. Is there a way in Quantech to apply the variable premiums without changing the amount on each individual policy?

In trying to determine ownership interests in a partnership, I am under the impression that you may use "profit" or "capital" interests. Is that correct?

Does that mean that you can choose to calculate ownership based on profits or based on capital? Or would you mix-and-match the two, say by taking the higher of profit or ownership for each partner?

Thanks for any responses or directions to appropriate citations.

I have a 401(k) plan which uses a nonsafe harbor definition of compensation for matching purposes. (Bonuses, overtime and a couple of other things are excluded, and the compensation percentages for the HCEs and nonHCEs do not satisy 1.414(s)-1(d).) The plan satisfies the 401(m) ACP test using a safe harbor compensation definition. My question relates to the rate of matching contributions and the benefits, rights and features nondiscrimination test. If I use a safe harbor definition of compensation, certain nonHCEs cannot receive the same rate of matching contributions as the HCEs. Does the definition of compensation, which on its face applies to everyone but impacts upon HCEs and nonHCEs differently, result in different rates of matching contributions under 1.401(a)(4)-4(e)(3)(iii)(G) and 1.401(m)-1(a)(2)? (I always thought that the compensation definition was irrelevant as long as the plan satisfied 401(m) using a nondiscriminatory definition of compenation.)