What is the norm for other DC plans in regards to reemployment after retirement (i.e., after a distribution or rollover has occurred)? Are there restrictions?

Under the Florida DB plan, retirees cannot return to employment for one year after retirement unless they suspend their DB benefits. The same law applies to members of the University Optional Retirement Program (DC plan), however, if a member has taken a distribution or rollover there is no benefit to suspend. In essence, there is "no teeth" to the law for the DC members.

We are a TPA and increasingly have plans across several states. In our state, Ohio, ER's don't pay workman's comp taxes on EE money run thru the Cafeteria Plan. Is this true for all states, or any other states? I haven't found a site to give us this information, and oddly enough, people from other states can't find the information about their own state either! Thanks in advance for any help or comments.

We are a TPA, increasingly doing business across the country. In our state, Ohio, the ER saves workman's comp taxes on money that the EE runs through the cafeteria plan. However, that may not be true for all states - does anyone know how I can determine this? Thanks for any and all help!

I'm I allowed to withdraw up to my basis without incurring a 10%

Penalty.

Example: I have a Roth that is three years old. I have made three contributions of $2,000 and the current balance is $6,600. I want to withdraw $6,000. Does this avoid the 5 Year rule?

Thanks.

I'm new to 457 plans. Under EGTRRA, does a non-profit employer adopting a 457(B) plan no longer have to coordinate deferred compensation limits with a 403(B) or 401(k) Plan? In other words, may a participant in both a 457(B) and a 401(k) plan defer $22,000 (or $24,000 with the catch-up) in 2002, even if the employer is a nongovernmental agency, under the new EGTRRA limits?

Does a plan that covers only Union employees have to worry about passing non Discrim testing. I haven't been able to find anything concrete on this.

I have a straight Profit Sharing Plan w/ a last day of employment requirement. I am fairly ceratin that if an employee terminates I shouldn't use his/her compensation in caculating the 15%. Relius still considers such compensation on the Maximum Employer Contribution Report. How do I make it stop?

A 401(k) plan provides for salary deferral contributions and employer discretionary safe-harbor contributions. The employer wants to add a matching contribution but only make a 1 percent match on a participant's salary deferrals. Is there any way the matching contribution would not be subject to the ACP test?

I have a takeover client that currently sponsors a 20% mp plan. The allocation is prorata on compensation. The plan document is a standardized prototype which requires an allocation to any participant credited with 501 hours.As part of the GUST restatement I would like to recommend a change to a ps plan with a tiered or age weighted allocation, but what must be guaranteed to the current participants? Am I stuck with a comp/comp allocation for all of 2002? Or can I allocate comp/comp on pay through the date of adoption,and tiered thereafter? Are there any other alternatives anyone can think of?Thank you.

What is the income limitation for a single person to contribute to a ROTH IRA?

Thanks

I have a client that is subject to the variable rate premium. I have calculated this premium under the General Rule using assets as of 6/30/2001 and vested benefits valued at 4.82% (Premium Payment Year = 7/1/2001 - 6/30/2002) as of 6/30/2001. I have also calculated the premium using the ACM (for plans with > 500 participants) using vested benefits as of 7/1/2000 and assets as of 7/1/2000.

Both of these methods produce a significant premium. Do I have any other options?

If it not addressed in the plan description, can an election be made for parking after a person returns from disability if they were out during the open enrollment process?

We have heard there may be a special advantage to using Veba's in providing a dependent care assistance program. What we heard is that the annual $5,000 limitation to the employee does not apply if used with a VEBA.

Is this correct?

Thanks for any help.

I am looking for survey information or information from TPA's on where participants are spending their Medical Flex Spending Account dollars. For example - of an annual election, XX% is spent on dental expenses, XX% spent on medical expenses and XX% spent on vision expenses, etc. If there is anything out there that breaks it down further by co-pays/co-insurance vs uncovered items, supplies, etc - I would be interested in that as well? THANKS MUCH!

We have a client who anticipates issuing salary cuts to their employees. The Plan allows for modifications in salary deferral elections effective the first day of each calendar quarter. Would a reduction in salary be an exception that would allow participants to modify their elections prior to the next quarter?

My client in bankruptcy has COBRA obligations because of a terminated retiree medical plan sponsored by a now-defunct subsidiary within its controlled group. Another subsidiary within the controlled group is also in bankruptcy and under Section 363(f) of the Bankruptcy Code wishes to sell its assets, "free and clear" of interests. First, I want to understand if I have the right understanding of COBRA. Does the purchaser under COBRA, if the selling entity no longer maintains any plans take the retiree medical plan obligations under the new COBRA regs, meaning, are the retirees that have never worked for the selling entity but who worked for a member of the selling entity's controlled group M&A qualified beneficiaries for purposes of the asset sale? Second, has anyone found anything that says COBRA trumps Section 363 of the Bankruptcy Code so that the assets cannot be sold free and clear of COBRA obligations? Any help would be much appreciated.

In case the full text of my question is cut off in the header for this post, let me restate it here: Must a plan contain a written formula in order to make integrated allocations at less than 100% of the SSTWB?

Background: Our New Comparability plan document used to contain "Fail Safe Self-Correction" language. That is, the document specified how EBARs were to be calculated, and how an initial allocation would be adjusted if it failed the General Test for Non-Discrimination.

Following recent trends, our GUST document is now devoid of testing and self-correction language. (Our allocation provisions also now allow for contributions to be declared separately for each Category (or Tier), therby reducing the rigidity with which a contribuiton has to be allocated. We thought this would give us the freedom, in years when demographic changes made cross-testing unappealing, to declare in integrated allocation, and satisy non-discirmination requirements by using the (a)(4) Safe Harbor rules for DC plans.

The reason we'd like to use the Safe Harbor under (a)(4) (as opposed to the General Test) is that we'd like to be able to use an integration level lower than 100% of the SSTWB. This is permitted under the 401(l) rules referenced under the Safe Harbor rules, but appears not to be allowed when imputing disparity under the General Test.

Our question is this: Must the plan document be written as a 'design based safe harbor' in order to use the safe harbor rules? Our concern stems from the fact that the safe harbor regs, at 1.401(a)(4)-2(B)(ii) read: "Permitted disparity. If a plan satisfies section 401(l) in form...(it will) not cause the plan to fail to satisfy this paragraph (B)(2)." We're concerned that the term, "in form", means that the form of the document must specify the manner in which 401(l) will be satisfied. Since our document is silent in terms of how it handles 'permitted disparity' does that mean we can only impute disparity at 100% of the Wage Base under the rules in 1.401(a)(4)-7? If that is so, then plans that would have passed the Safe Harbor using 401(l), could end up flunking under the General Test.

Thank you in advance for any replies. Thanks also to Tom Poje for being a superb moderator. Does our concern leave you worried Tom?

It was stated in a 5500 seminar last week that if a pension (db, mpp, psp, k, etc.) plan includes Insurance, feature code 4B must be included on line 8b. Can anyone confirm this?

A DB plan terminated 15 years ago and assets were distributed within the required timeframe. The plan no longer exists. Annuities were purchased in conjunction with the plan termination.

The employer now discovers that a person who was not eligible under the DB plan, (a non US employee), was in fact included in the plan as well as the plan termination and consequently a benefit was purchased. No payments have begun for that individual. The individual has not completed the paper work for a tax treaty.

How does the employer correct this? Can the insurance company revoke the certificate provided to this individual as mistake of fact and return the money to the employer (reversion)?? Seems to me that if an irrevocable commitment was made to the individual- then may be difficult to retract.

Thanks