Did anyone else out there in ERISA land laugh at PwC? They are changing their name to "Monday". I don't know if I want to work with a consultant who is always "Monday".

Here it is June . . . I am modifying the statement design for a plan, and in testing the statement I come across a participant who deferred $10,710 during 2001! How could I have missed this! Fortunately, about $220 came in at the beginning of the 2002 plan year.

At least I hope that's fortunate . . . can deferrals be recharacterized for the new plan year?

Hi-

I have a plan that had to put in a top-heavy contribution for the plan year ended 12/31/01. The company put only the 3% top- heavy contribution in - no other employer money was given. To receive the top-heavy contribution participants had to be there on the last day of the plan year.

For schedule T can I check off d one questions 3 or do I need to run the ratio on question 4?

Thank You!!!

Plan sponsor has filed for bankruptcy and has no money to fund the money purchase plan contribution for 9/30/01 PYE. Too late to file for minimum funding waiver. Corporate tax return has not been filed yet. Would the trustee (owner) ultimately be responsible for the contribution? Any options available to plan sponsor?

Reg. section 1.415-2(B) states that the limitation year is the calendar year, unless an election is made to change the limitation year. Section 1.415-2(B)(2) states that the method of election is by the "adoption of a written resolution by the employer".

In my case, my client, a local government, adopted a plan with a non-calendar year limitation year. The board of supervisors adopted the plan (which defines the limitation year as a fiscal year) but did not specifically "elect" a non-calendar year limitation year.

Does anyone know if a resolution which generally adopts the plan will qualify as an election to change the limitation year? I have not been able to find any additional guidance on this issue. Any insights would be appreciated.

One of the owners of an S-Corp is thinking about donating some of his stock to a public charity. Public charity would then sell the stock back to the ESOP that is sponsored by the S-Corp. Can this be done?

I have a plan sponsor that has asked whether or not it is permissible to allow for post tax contributions under his qualified retirement plan. The plan is a 401(k) with employee and match contributions. The document allows for post tax contributions. The custodian will accept these contributions as a money source. I am unfamiliar with the non-discrimination testing as it pertains to the post tax contributions. Coud somebody please highlight for me those tests that are required and possibly point me to a good resource?

Thanks in Advance...

It appears that Relius can not calculate mid year entry dates when processing an annual valuation (i.e. a 07/01/01 entry date when processing a 12/31/01 eligibility transaction)

If this is so, then this is a problem.

The work around appears to be removing the hours requirement from plan specs and then running eligibility OR hand calculating mid year entry dates and then manually entering them.

Any other ideas and/or comments.

Does anyone know if you can piggyback reports within Crystal Reports?

We just terminated a 401k plan and received a favorable determination letter. Is there a time frame during which we have to distribute participant accounts? (e.g. 120 days). Thanks.

Since it is a DC plan, I'm thinking yes, but I've never seen a target be participant-directed.

Any reasons why it shouldn't be?

In light of the fact that the IRS now considers Health Care FSA's with 100+ participants to be a welfare benefit plan, and should file a Form 5500, but has suspended the requirement to file Schedule F, does anyone know if there is another Schedule that should be filed?

Sorry about the structure of that question, it's the equivalent of a grammatical train wreck.

Any help would be greatly appreciated. Thanks

If we have a plan that has a 401(k) feature with a 3% safe harbor contribution, can we use that contribution to satisfy the minimum allocation gateway under either of the following examples:

1. Employer contributes the 3% safe harbor contribution and an additional 1% discretionary contribution to the NHCEs. Can the HCEs receive a 12% (4% X 3) contribution assuming the equivalent benefit accrual rate test is met.

2. Employer contributes the 3% safe harbor contribution and an additional 2% discretionary contribution to the NHCEs. Can the HCEs receive the maximum contribution which allows them to satisfy the equivalent benefit accrual rate test?

Does the vesting requirements of the additional discretionary contribution affect the answer?

Thank you.

When a 401(k) plan is amended to add SIMPLE provisions, would prior profit sharing or match contributions have to be vested 100%? Would you be able to keep the prior contributions under the plan's vesting schedule and use any forfeitures that may occur to reduce the contribution deposit to be made for the SIMPLE match or SIMPLE ps contributions?

We have a leveraged ESOP where the original bank debt and ESOP debt are the same. Both have variable interest rates and different payment terms. What would be the tax deduction, based on the following facts:

Bank loan:

principle payments - 750,000

interest payments- 365,000

ESOP loan (15 yr loan):

principle payments - 126,000

interest payments - 390,000

Compensation expense (based on P&I method of amortization for calculation of release of shares):

FMV basis of shares released - 250,000

cost basis of shares released - 270,000

-David

I have worked for a company for 32 years. In 1995 the company changed the method used to calculate the pension amounts and created an "old" and "new' pension plan. This change was supposedly done to even out the plan and improve the plan benefits for new employees.

A date was established whereby some existing employees would remain on the "old" plan, and the rest would move to the "new" plan.

Rather than allow ALL existing employees to remain on the more lucrative "old" plan, some were forced to the "new" plan greatly reducing the plan benefit.

After dangling a carrot in front of an employee for many years this seems illegal to me.

I'm interested in all comments, thanks

I finished attending school last summer. My first job out of school was a temp job, and I was asked to work as an 'independent contractor.'

because my income for last year was very low (less than $2000), I thought contributing to Roth IRA makes much sense. So I contributed the exact amount that I made into Roth IRA (after I got a 'real' job this year but before 4/15.)

I understand that to be eligible for contributing to Roth IRA, you need to have 'earned income'. Since my income is 'earned', I thought I can contribute to Roth IRA. Was I right? or Was I only eligible for Self Employment Plan (SEP) IRA?

If I was not eligible, I need to transfer the money into this year's Roth IRA -- Would there be a penalty for doing so since it's past tax deadline? My bank where I set my Roth IRA account is not reliable when it comes to this type of questions, please help.

Is there any guidelines on reallocating shares that are diversified? I could not find any instruction in the document.

Does tuition for kindergarten at a private school qualify as an employment related dependent care expense eligible for reimbursement under a dependent care assistance program?

As anyone who has worked with these plans knows, there are a number of nondiscrimination rules that are applicable to 125 plans as well as to the underlying plans (health FSAs, dependent care plans, etc.). Most, if not all, of these rules are plagued with inconsistencies, ambiguities and very little meaningful guidance. Except in certain small employer situations, where the discrimination violation is obvious, I don't believe there is much worry about compliance. And, frankly, I am not sure there is much need to worry because I, personally, have seen no enforcement action whatsoever from the IRS in this regard. This leads me to my question: Has anyone had any experience with the IRS making any effort to enforce any of these rules? If so, please share what you can about your experience. Thanks.