I've been under the impression that an employer can set up a SIMPLE IRA plan in the year immediately following the year a 401(k) plan is terminated. I can see where a SIMPLE 401(k) could be considered a violation of the 1 year rule, but I don't believe the SIMPLE IRA plan comes under the same restriction. Any opinions on this?

Can anyone tell me if governmental employers are exempt from the FAS 106 requirement for retiree medical plans?

Thanks in advance.

Is there a maximum term for a principal residence loan? I have looked at the Section 72(p) and all I find is these loans are can be extended beyond the 5 years.

I have some questions regarding converting from conventional IRA to Roth. I have a fair amount of traditional IRA accounts. I would like to perform some conversions should that be favorable. I would like to make conversions closer to the market bottom because they are stock accounts and the tax cost will be reduced. My understanding is that if you convert to a Roth, you can recharacterize back to a conventional IRA after 31 days. If it seems that I did not identify the market bottom, there would be a way to restore. My additional understanding is that after another 31 days, you can reconvert again. If I am right, it means that if you convert and a month later the market is way down, you can go back and hope that it stays down for 31 days and then the tax liability can be reduced. If we are at a potential low right now, I should perform the conversion and monitor the market.

Am I missing something or is what I am saying basically correct? Thanks for any responses.

This question concerns a self-funded health plan that qualifies as a church plan. Are there any rules or regulations concerning how much in employee funds you can hold in reserve and how long you can hold employee funds in reserve?

1) In a controlled group, can each separate company have a Sec 125 plan? Or is it required that they all live under 1 plan? If they can have separate plans, can those separate plans have different benefits?

2) Along the same lines, if a parent company has a Sec 125 plan that covers all of its subsidiaries for core benefits (med, den, vision, and FSAs), can one of the subsidiaries put an additional but separate 125 plan in place to accommodate additional benefits for just that company? If they do, should all of the other subsidiaries have access to these additional benefits?

3) If there is a controlled group of 2 companies, can one of the companies implement a Sec 125 plan even if the other company is not included? Or, can the one company at least offer for the second company to be a part of the plan and the second company choose to decline?

4) Very basic! -- what is the basic determination of whether 2 companies make up a controlled group? If a single person owns 100% of both, is it a controlled group? If one company owns 25% of the other, is it a controlled group? If one company owns 51% of the other, is it a controlled group?

Thanks in advance!! (And is there a good article or place to learn more about this??)

Our firm is looking for a good all-around pension distribution forms software package. What we have in mind is a system into which a data entry clerk can input the basics (name, SSN, account balance, vested %, optional forms, etc.) and out will come all the required distribution election forms, tax notices, withholding forms, etc. Does anyone know of such a system???

A retiree who is receiving MRD payments has been rehired by his former employer/plan sponsor. Can he elect to stop receiving his MRDs?

What type of ER paid benefits can be included in the 25% concentration test?

Thanks, Joe

A qualified plan has not been amended to incorporate the higher 415 allocation limits prescribed by EGTRRA. The plan sponsor does not intend to ever increase the 415 allocation limit. There are presently amounts being held in a 415 suspense account under the plan (attributable to excess contributions in prior years). If the plan had adopted the higher EGTRRA limits, the entire 415 suspense account balance could have been allocated to plan participants this year (2002). However, the plan's pre-EGTRRA 415 limit results in amounts having to remain in the suspense account. It is clear under Rev. Rul. 2001-51 (Q-14) that any future excess contributions to the plan that cannot be allocated because of the plan's pre-EGTRRA 415 limits may not be held in a suspense account going forward. Could the Rev. Rul. be interpreted to require allocation of the entire 415 suspense account balance in 2002, notwithstanding the fact that doing so would be contrary to the terms of the plan?

I participated in a Thrift Savings Plan and contributed post-tax money. It was also matched by the employer. I am now terminated and would like to roll this money over to a Roth IRA. The administration firm of my previous employer states that I am not able to do this. What is the reasoning behind this? I was told that I can roll the money over to a traditional IRA, but not a Roth. Are there any other options, since I do not want to roll it over to a traditional IRA since it is post-tax money. Is this according to the plan document or is it a regulation for all such plans? Any information would be helpful. Thank you.

Assuming a participant is a "catch-up eligible participant," must elective deferrals be recharacterized as catch-up contributions due to a failed ADP Test? Or can the participant (or the plan sponsor acting on behalf of the participants) elect to have the ADP violation refunded rather than recharacterized?

My firm just took over a plan from an accounting firm who always did their own 5500's. One the Schedule T, they checked Box 3(d) indicating that all nonexcludable employees benefit. The document has a last day rule on both the Match and Discretionary PS.

Although when testing the 401(k) piece is 100%, but the 401(m) and the profit sharing piece are not.

Had I done the 5500 in the past I would not have applied the exceptions and completed the entire form.

Am I crazy?

Marybeth

We are preparing a 5500 for a large plan. The auditor wants us to lump realized and unrealized gains/losses from registered investment companies into one line- line 2b(10).

We have the realized gains on 2(B)(4) and the unrealized on 2(B) (5)(B). On 2(B)(10) we have capital gains/dividends.

How have you seen it prepared/reported?

I am a nine-year school district employee that participates in a section 125 cafeteria health plan. This year was the first time enrollment was done "on-line." I apparently did not click the correct box to have my two boys insured (who have been insured w/ same plan all their lives.) I did enter all their info. (ss#, birthdate) and I even have a printed copy of this w/ an approval date for both boys. The benefits administrator at the District told me that the approval date was only verifying their personal information, not that they were approved for insurance. And, of course, I was told that I'd have to wait for next May and open enrollment. Unfortunately, both boys have asthma and severe food allergies, so no other carrier will pick them up. My arguments that my intent was certainly to cover them and if this was my fault it was a clerical error have fallen upon deaf ears.

Do I have a chance if I continue to fight this?

A Plan excludes per diem from compensation used to allocate the employer profit sharing contribution and for the match percentage. After allocating the PS and making a match throughout the 2001 plan year, it is discovered that the definition of compensation does not pass the 414(s) test.

What are the solutions for both the PS and the match, as they are discriminatory?

I don't work with 401(k)'s but a client of mine recently had an interesting question for me. They currently have a 401(k) where the employees can select from a dozen mutual funds. To sell this, their broker must be NASD licensed only -- it is not an annuity contract. They are considering moving to a new 401(k) that is labeled as a group annuity contract. Can anyone explain to me the major difference (or why someone would want to change) or point me to a website where I can become educated on differences?

Thank you!

My ex-husband did not declare his 401k plan at the time of our Uk divorce and my attorney did not bother to pursue it. I have now had to take out a negligence suit against my attorney and I am trying to clean up the mess myself. Can you make a retrospective application for a QDRO in PA? Four days after the divorce he had already named another beneficiary. Any advice appreciated. No US asset/insurance other than a variable annuity were declared. He also did not provide official proof of income and was claiming marital status on his IRS form-and it wasn't on his marriage to me.He's a UK citizen with Us residency status.

An employer has an employee that opted out of their POP 125 plan. Unfortunately, when the employee was entered into the payroll, they were entered as "pre-tax" instead of "after-tax". They've discovered their error at the end of the plan year. If the employee raises a stink about this, how can the employer correct their mistake? We're talking about $400 of insurnace premium..

Where can I find, in writing, concrete information regarding an employer's liability for dependent care in a FSA? We are planning to set our maximum dollar amount at $5,000 per year for dependent care. Is this too high?