Here's what I hope will be a quickie.

Does 4.50% of pay plus 5.70% of excess of $16,000.00 pass the "excess can't be more than 2x the base rule?"

Thanks.

For church plans exempt from ERISA, who oversees the actions of fiduciaries? Who do participants contact if there are fiduciary violations in the operation of the Plan?

Participant named spouse as beneficiary when he initially enrolled in plan 8 years ago. He divorced approximately 2-3 years ago and never changed beneficiary. Remarried in January and passed away last Wednesday.

Account balance is nearly 30K, so worth some discussion. Am I correct in saying that the named beneficiary (ex-spouse) gets the $$$$?

We are working with a employer sponsor that has not filed 5500's or performed testing since 1997. We have already filed under DFVC and will need to go through VCP for some issues.

The plan has failed both the ADP and ACP test for all years 1997 forward. We will be using a "one-to-one" correction method to correct. With this, the distribution amount will be adjusted for earnings through the date of distribution.

Question:

It seems as if the correction distribution will be taxed to the HCE's in the year that it is distributed. It definately falls outside the 2 1/2 month period.

Therefore, it appears that there will be no need to amend the personal 1040's of the HCE's for 1997 forward, because the distribution will be taxed in the year in which it occurs.

I know that there will also be some excise tax due, but does the above seem logical?

Thanks,

Ronnie Wasel

An employer maintains a group health plan and offers coverage for all US offices through national carrier.

Employer sets the cost sharing as 75/25 and all offices comply except for one.

Therefore, employee in this office contribute a lesser amount for the same coverage that other employees are paying more for.

Is this allowable?

I am preparing a valuation for 12/31/01 (the first plan year). The client has just acquired Fiduciary Bonding in 2002. Do I have to note on the 2001 form 5500 that the client did not have bonding since they did not acquire it until 2002, even though it's their first plan year?

Should voluntary after-tax money be considered when calculating a 70 1/2 minimum distribution? If so, should earnings and contributions be considered or should contributions be excluded from the calculation?

Two participants in a Top Heavy Plan must receive the 3% minimum for 2001. Although they had not met the hours requirement for the 2001 plan year, they had met eligibility requirements in a prior plan year.

As an aside, the standard employer contribution is 15% of eligible compensation, which is then allocated using permitted disparity.

Because my two non-keys will be receiving a 3% minimum, do they have what can be defined as eligible compensation for determining the employer's profit sharing contribution for the year? Do I include their compensation when I am calculating 15% of eligible compensation?

Does anyone know how to fill out Form 5300 for a multiple employer plan? The instructions say to fill out one form omitting line 3 and to fill out another form for each other employer (only lines 1-8, optionally 13-14 and Schedule Q). This makes no sense. I called the IRS and was told "line 3" was a typo - it should be "line 13." This still makes no sense. It makes some sense that one 5300 is for the plan and the others are for each employer, but the questions are still repetitive and how is each employer indicated? By putting them in line 1a "name of plan sponsor"?

Corporation with Standardized Profit Sharing Plan sold it's assets to conglomerate mid year. All employees were transfered over to the new company and began participating in that company's plan. However, the old employer still wants to give a profit sharing contribution to all of his old employees. Plan year end is near. They will be terminating the pan at year end and all participants will be 100% vested. In computing this year's contribution, one participant who normally works over 500 hours per year and has received contributions in years past, did not get over 500 hours of service this year because of the sale and transfer. I don't see anything in the plan that would allow for a contribution to this participant since this is not a short plan year. Are there any conditions under which this man should receive a contribution?

We have a SH 401k cross tested plan with age 21/1 year entry into the PS portion. The 401k allows entry after 3 months of employment. The plan is written where the 3% non-elective safe harbor contribution will only be given to participants who have met the age 21/1 year eligibility.

The plan is top heavy. Do the early participants in the 401k have to receive a top heavy contribution if they are not yet eligible to participate in the employer contribution?

Mother of participant in 401k plan died - she had unpaid Medicaid

bills of $10,000 which participant is told he must pay as executor of estate. Plan uses safe-harbor distribution rules - I don't see any way he could request a hardship here. Anyone have any different views on this? Thank you.

A client selected W-2 wages as the definition of compensation for 401(k) Plan purposes. Several employees have car allowances that are included in W-2 wages box 1. Wouldn't this mean that they should be deferring their applicable % for 401(k) purposes as well as making the 3% safe harbor contribution on the total amount of W-2 wages?

Hi. I'm looking for information about calculating value of benefits; not simply as a percent of payroll. I want to come up with the value based on richness of benefit coverage and cost to compare on the same basis to peer companies.

Hewitt has done this sort of thing with their value index product.

Suggestions or know how? Thanks.

Jim Simons

Compensation & Benefit Solutions

Client has 401(k) plan. Client going to acquire/merge with other company. Other company also has a 401(k). I don't know the in's and out's of the transaction, but only received a copy of the other company's most recent 5500 for review. I'm assuming the other company is not going to terminate it and have the e/ee's roll over or take their money. Thus, any heads up on issues which need to be addressed in the context of a merger??? Thanks.

How do you handle 415 maximum with a 12/31/01 401(k) plan year end and 6/30/02 money purchase plan year end? Limit MP contribution by 401(k) annual additions? Please help.

Can ISO stock options be legitimately purchased by a Roth IRA?

Rick The Tech:confused:

Can anyone provide some ideas as to how much more difficult or how much more study is required for the C3 V's the C2DB ? Also is it worthwhile for an adminstartor to take this exam ? I have heard it is geared more towards consultants ?

If Employer "A" chooses to terminate the contract with an Insurance carrier and they also wish to reimburse each participant for the CDSC(back end charge), does the reimbursement count as a contribution and need to be tested for Non-Discriminatory practice or can it avoid being considered a contribution.

Thanks

As a health care provider, we are looking at offering alternative health services to the community. "Alternative" is defined by us as acupuncture, massage therapy, nutrition counseling, lifestyle coaching, yoga, Tai Chi, Gi Gong, Pilates exercise classes.

How have other health plans considered things like these? Flat dollar contribution, i.e. up to $500 through the health plan or have others funded it through a 125 flex account? Our current plan excludes coverage.

thanks,

kerryb@waushosp.org