My own accountant doesn't know the details on this.

My husband just found out that because of budget cuts, he is laid off. We had signed up for quite a bit of money to be put into the flex account and have been using it to pay for our daughter's orthodontia bills. A friend of mine tells me that she thinks his employer is responsible for the deficit, because of the one year contract we signed, even though the account will have created a negative balance.

I contacted his employer and they tell me that even though he'll continue to get paid through August, the flex account will shut down next month and there's nothing we can do and that they aren't responsible for the deficit.

I'd appreciate any guidance you can give me on this.

Thanks very much.

I posted this also on DB board -

Does anyone work with any companies that are required to report pension liabilities under the new UK accounting standard - FRS 17? I have received different interpretations as to what is to be disclosed in the footnotes for multi-employer plan withdrawal liabilities.

If anyone has any information regarding this please let me know.

Please refer to IRS Reg. 1.411(a)-7(B), last sentence of subsection (1), immediately before the Examples in subsection (2).

This sentence seems to state, for purposes of vesting and other requirements in IRC 411, that the latest NRA is the first day of the plan year which contains the fifth anniversary of participation, even if that is not the "fifth anniversary of participation."

I don't know where this came from. It is not supported by a plain reading of IRC 411(a)(8), nor do I find anything in the Committee Reports from 1974 that would support this. The Gray Book does not address it.

Can anyone help?

In case you are wondering, this is the only other discussion thread I found that seems to be related.

http://benefitslink.com/boards/index.php?showtopic=13667

[This was originally posted under Cross Tested Plans-received no response]

It seems clear that an ESOP cannot be cross tested for 401(a)(4) purposes, but if you are testing a profit sharing plan and must go to the average benefits test, and an ESOP is included, does anything prohibit determining the employee benefit percentages for the combined allocations on a benefits basis?

I don't see anything prohibiting it, but it seems like a contradiction.

Is anyone familiar with a survey dedicated to 403(B) plan sponsors? I'm trying to get a handle on some of the same statistics which are typically provided in surveys dealing with 401(k) plans, i.e. employee participation rates, employer matching formulas, administrative costs, etc.

Any help would be appreciated in pointing me towards a relevant source.

Thanks

Kerryb@waushosp.org

Have a client with nearly $2,000,000 in nonqualified assets.....mostly art and furniture. Makes up over 95% of total assets of plan. the problem is they are having trouble finding an insurance Co. that will issue them a fidelity bond because of the type of assets. Any ideas on how to get a waiver on the independent audit requirement without a bond or know who would provide a fidelity bond for these type of assets. Thanks

What information goes on line 1b(1) Current Value of Assets.

I admit the instructions for this line are not the best, but when you compare those instructions with those of line 1b(2), I'm of the opinion that both lines must tie together- the only difference being that line 1 is reported at market value and line 2 is reported at actuarial value----which further means that we must include contributions paid after the valuation date that are applicable to the prior plan year on both lines.

Some practitioners have excluded the contributions received after the val date on line 1b(1) but include them in 1b(2). I disagree with that and believe both lines must linclude these contributions.

Does anyone have an opinion and possibly documentation (other than the instructions) on what should be entered onto line b1(1)?

Thanks

An officer (and less than 10% owner) of a professional partnership also provides professional services to a company that forms a real estate limited partnership (RELP).

The officer wants to invest his self-directed 401(k) account in part, in the RELP. The professional partnership's 401(k) plan has a corporate trustee, so the officer is not a fiduciary by virtue of being plan trustee.

Is it a PT if the officer invests only for his own account? Is there an unrelated business taxable income issue?

Disclosure: this is also posted on the Investments Board.

We have a custom participant statment that we have been sending to clients for years. In one particular plan we have two participants with the same name (father and son). When we would print the report, they would come out as two separate participant statments. The last group of correct statements were sent to the client in January (12/31/01 val). After this point we installed sp7, sp8, and sp9.

Somehow when we print the same participant statment (was not altered in any way) it will combine the information for the two participants into one report. They are separate records in Quantech, so why would the report writer pull them into the same report, especially when it never did before? For the record we are on version 7.0 now and it will do the same thing. What was changed that would cause this to happen?

Employer is a public school district. It wants to amend the superintendent's contract to provide for annual employer contributions of $40,000 to a 403(B) annuity for 5 years after his retirement.

403(B)(12)© excludes governmntal plans from the requirements of 403(B)(12)(A)(i), so it appears that the plan's discrimination in favor of an HCE is permitted. 403(B)(3) counts compensation "for the most recent period" as eligible compensation under 415 for the 5 years following termination.

So, if his compensation exceeded $40,000 in the year of termination, it appears that this could work. (We will assume that there are no problems under state school law.) Am I missing something?

Does anyone work with any companies that are required to report pension liabilities under the new UK accounting standard - FRS 17? I have received different interpretations as to what is to be disclosed in the footnotes for multi-employer plan withdrawal liabilities.

If anyone has any information regarding this please let me know.

Plan sponsor wishes to change the deferrals and match investments of the safe harbor 401(k) from employee to employer directed. What if anything should he be worried about? How much notice needs to be given to the employee? Besides admin hassles, any reason not to do this plan amendment as a mid year change? Any insight would be helpful.

When performing the top heavy ratio test for a 401(k) plan do we add back amounts that were distributed due to a failed ADP test?

If a company in NY has 20+ employees, and a company in PA (a wholly owned subsidiary of the NY company) has 5 employees, does the Federal continuation rules apply to the PA employees, or state continuation rules?

An officer (and less than 10% owner) of a professional partnership also provides professional services to a company that forms a real estate limited partnership (RELP).

The officer wants to invest his self-directed 401(k) account in part, in the RELP. The professional partnership's 401(k) plan has a corporate trustee, so the officer is not a fiduciary by virtue of being plan trustee.

Is it a PT if the officer invests only for his own account? Is there an unrelated business taxable income issue?

If an employee is receiving short term disability benefits under a self-funded STD plan and the employee is terminated due to a staff reduction, is there any legal obligation to pay out the remainder of benefits available under STD as long as the employee remains disabled? Or does the obligation to pay Short Term Disability end with the termination of employment?

I have a client (sole-proprietor), who does not want to contribute for his benefit into the profit sharing plan. He wants to make a contribution to all other rank and file (and get tax deduction), but not to himself. Can he do that? He does not necessarily want to do this every year. I cannot find any guidance on this issue.

I know that if the document is non-standardized, one can elect not to participate, but this is irrevocable, therefore he may never participate in this plan or any other plan he maintains. Also, apparently, if he was already participating, he may not elect out. This is only good for new participants. Am I understanding this correctly?

Any ideas out there?

Thanks

I have found that a few times when creating custom reports, if you use a different print driver to print the report than was used during creation it will sometimes print incorrectly (formatting) or not at all.

This problem occurred when using different print drivers for the same printer and the same OS. Since RA7.0 allows you to use Windows 2000, I have installed that OS and the corresponding printer drivers. The rest of the organization uses either Windows 98 or ME. Will this cause a lot of problems when distributing Custom Reports???

Any help with this is greatly appreciated.

I would like to know how employers are treating expenses for graduate courses in their educational assistance plans?

Situation: A prototype sponsor's GUST restatement is effective 1/1/1997. A number of plan design changes occurred during the GUST remedial amendment period, and amendments were made to the pre-GUST prototype.

Question: Since the effective date of the prototype GUST restatement is 1/1/97, is it necessary to complete the adoption agreement as the plan exisited in 1997, and then "supplement" the adoption agreement with the effective dates of the non-GUST amendments?