An employee elected to defer 5% pre tax. The employer actually withheld it on an after tax basis. This has been going on since 1/1/2001. Can it be corrected for 2001? What about for 2002? Or can it only be corrected from this point forward?

Can a Roth IRA be funded if the only "earned income" is non-taxable disability income? Can a spousal Roth IRA be funded if tax return filed married filing separately? What is the limit on a spousal Roth IRA for 2002?

FYI!

A new message board under Continuing Professional Education has been added to respond to queries about continuing education programs specific to the 457(B) and 403(B) market segment. It appears under "National Tax Sheltered Accounts Association" where questions can be posed about the accreditation program (CRS/MCRS), and educational symposiums.

New Message Board under Continuing Professional Education.

For queries about professional education in the 403(B) and related markets, a new message board "National Tax Sheltered Accounts Association" has been added. There, we will respond to queries about the CRS/MCRS accreditation program, as well as the Educational Symposiums offered through the NTSAA. The new Board responds to interest expressed in educational programs specific to this market segment.

FYI!

We are curious how other recordkeeping firms handle "extra" requests from clients. We have a large client who frequently asks for extra small things such as mailing another statement to a participant who never rec'd theirs, sending an extra quarterly ledger to someone else in their HR department, etc. etc. These sound very small and nit-picky as I type this message, but they are never-ending. And some of their requests are much larger, like asking if their 401K clerk can leave our phone number on her voice mail when she goes on vacation! We are on a fee schedule with this client but nothing in the schedule contemplates the little weird extras they are always asking for. We hate to appear penny-pinching but need to address this situation and thought we could benefit from the experience of others in this same situation.

Hi, I'm a Canadian citizen and I've worked in the USA for the last 3 years. During my time working I've opened up a Roth IRA and I also have a 401(k) plan with my company.

I have decided to move back to Canada. What I am wondering is what will happen to my Roth IRA and my 401(k) plans? What are the tax consequences of me moving? Will I be allowed to transact on my accounts? Will I be allowed to deposit money into my Roth IRA even though I do not live in the USA anymore? What am I allowed to do with these accounts? What am I not allowed to do?

If anyone has some knowledge of what happens, I'd like to know! I'd also like to know what my options are (if any).

Thanks in advance,

-Dennis

I am going to retire soon. I have received an Election Notice: Joint and 50% surviving spouse option. Basicly I have two options. 1. Lose 15% of my pension so my wife will get 50% of my then monthly pension for life when I die. or 2. If I die 60 months after retirement she will get 50% of my pension for the remainder of the 60 months. (If I die after the 60 months she will receive nothing) I have several questions. 1. Do I have to elect an option? My plan says I have 90 days prior to or 90 days after retirement to give written notice, but I does not say what the penalty is If I do not elect one. ( I do not like either option). 2. Is this something my company can do? 3. Is this legal? 4. What can I do to chage the so called "options" for my wife if I die first? I have worked 25 years, I just feel my wife deserves more than what the penion offers her compared to what I have put into my pension. I have read the ERISA and tried other IRS, QSPA research but I am unable to get information on this particular issue. (or I have over looked it) Any help would be greatly appreciated.

I am getting ready to retire. My pension plan has a Election Notice. Joint and 50% surviving spouse option. To sum it up-If I elect this option I can have my monthly pension reduced by 15%. When I die my wife will receive half of my monthly pension for life. OR If I do not elect this option If I die before receiving 60 months of benefits, my wife could receive a monthly benefit equal to my monthly payment for the REMAINDER of the first 60 months only. After the 60 months is paid my wife will receive no further benefits. I have several questions. 1. What happens if I do not elect either option? (I have 90 days prior to retirement and 90 days"election"period after retirement), but no "penalty" is given. 2. What other options do I have? I don't like either option. 3. Is this something my company can legally do? It may sound dumb, but why do they get to dictate my pension that I have put into for 25 years? Any help in this matter would be appreciated. Thanks!

Please help with the following three questions:

1) What eligibility restrictions can be placed on a SAR-SEP?

2) What testing requirements must be met with a SAR-SEP?

3) What vesting schedules are available for a SAR-SEP?

Thanks in advance for any help provided.... JimJ

As you all know, termination is not a 403(B) distributing event. However, because EGTRRA provides for severance from employment, distribution becomes possible on this basis. I would like to terminate a 403b plan once all the distributions have completed but I am not certain how to do so. My resources indicate that I will have to amend the plan and perhaps have a board resolution regarding the termination but I am not certain of the specifics. Does anyone have any idea?

Thank you in advance for your input and suggestions.

Caroline

When preparing Schedule I for a final Form 5500 (money purchase plan merged into Profit sharing plan), how do you answer question 5a - was a resolution to terminate the plan adopted during this or any prior plan year? A resolution was adopted to merge the MPP plan into the PS plan. For purposes of answering this question, is this plan considered terminated or not?

Question regarding controlled group vesting service:

From 1/1/99-12/31/00, Employee A performs 2 years of service for ABC company and earns 2 years of vesting service under the ABC 401(k) Plan.

On 1/1/01 A leaves ABC and is hired by DEF Co., an unrelated employer. A performs two years of service at DEF, under the DEF 401(k) Plan.

On 1/1/02 ABC Plan is merged into XYZ Plan, a plan sponsored by XYZ company, a related employer of ABC.

On 12/31/02, XYZ acquire acquires DEF Co., and the DEF Co. 401(k) Plan.

On 1/1/03 the DEF 401(k) Plan is meged into the XYZ Plan.

Question: How many years of service MUST A be credited with under the XYZ Plan?

I belive the answer is 4 years of service (iow, the XYZ plan must count both DEF and ABC service), but would like confirmation.

Thanks in advance!

What is the potential effect of GLB as it relates to trades executed by a state chartered trust department for clients - such as passive order taking and other securities transactions?

what is the current status of the legislation and the scheduled effective date?

does this end the trust exception?

What options are available for measuring vesting service under a plan that uses the Elapsed Time method of calculating vesting service?

My questions arises out of this example: a full-time employee who was hired on 7/1/2002 and who terminates on 6/29/2004 has only ONE period of service for vesting purposes using the "pure" Elapsed Time method. However, using an Hours of Service method (with a calendar year/plan year computation period), this same participant -- assuming he/she is full time -- would likely have THREE vesting years of service (for the 2002, 2003, and 2004 plan years). That is a pretty dramatic difference.

Query: can the Elapsed Time method be tailored in the plan document to "round up" partial periods of service, and if so, what are the limits of any such flexibility?

Thanks!

Company A has affiliated with a PEO, who will hire all employees, including the owner, and lease them back to Company A. The PEO will provide all health, welfare and 401(k) benefits. Company A will terminate its 401(k) plan, and will make distibutions to all participants. Question: Is there a distributable event? Do the amendments to the same desk rule allow for this? Has there been a "severance from employment?" Thanks.

MPPP was frozen in 1998. Forfeitures have occurred in 2001 plan year and TPA wants to know how to allocate them since contribution formula was amended at freeze to 0% of compensation. ??? Plan doc provides for forfeitures to reduce employer contributions. Possible to amend doc to provide for forfeitures to be used as additional contributions? Even if possible, how do you deal with the 0% of compensation issue? In both cases, reduce vs. additional still yields unallocated forfeitures....

Are employers bound by law to be consistent in their adminstration of STD benefits from employee to employee?

Starting as recently as December 2001, several employees going out on STD were told they were not required to exhaust their sick day accruals before their STD benefits kicked in. In addition, they were allowed to offset their STD benefit with accrued sick time so they were reimbursed at 100% salary for the STD duration.

I met with my HR rep last week and was told that that is not how the policy was administered, that those other employees must be "confused" as to how their benefits were administered, and that I will need to exhaust my sick days before my STD benefits kicks in. She confirmed (when I asked) that there had been no change in the STD benefit policy.

I have ample evidence (in the form of paycheck stubs that clearly delineate how many sick days they had accrued before their STD leave, how many sick day hours were included in each paycheck they received during their STD leave, etc) from those employees who were allowed to offset their salaries.

Any info would be greatly appreciated !

HAVE A PUBLIC BENEFIT CORP CREATED BY THE STATE, HAS BEEN MAINTAING MONEY PURCHASE PLAN SINCE 89. I HAVE LITTLE KNOWLEDGE ON GOV PLANS AND I AM BEING ASKED TO TAKE OVER ADMINISTRATION. I WOULD LIKE TO GO TO A PROFIT SHARING PLAN WITH A FUNDING FORMULA SPECIFIED IN ADOPTION AGREEMENT. THE QUESTION I HAVE IS THIS.

IS THIS AUTHORITY ABLE TO EXECUTE AN ADOPTION AGREEMENT, WHERE THE SECRETARY & TREASURER OF THE AUTHORITY ARE TRUSTEES? THE AUTHORITY IS MADE UP OF MEMBERS WHO SERVE ONE & TWO YEAR TERMS. I WOULD LIKE TO MAKE THE TRUSTEE LANGUAGE A DEFACTO DESIGNATION BY POSITION.

ANY GUIDANCE WOULD BE APPRECIATED!!

Is there a difference between the maximum permissible contribution and the maximum deductible contribution to a defined benefit pension plan? If so, how is the max. permissible calculated?

I want to make sure I completely understand the ASPA webcast Q&As.

If a plan excludes associate attorneys from the profit sharing portion of the plan but allows them to participate in the 401(k) and the plan is top heavy, associates will receive a 3% top heavy minimum. However, since they are not benefitting under the PS portion of the Plan, I would think they do not need to be bumped up to 5%. I hope that the IRS considers the top heavy contribution only to be a seperate portion of the plan subject to 410(B) on it's own and that the associates are not in the 401(a)(4) test.

Any thoughts?