I have a client whose Dr. is claiming he is disabled. When he went to SSA, they asked him if he had a 401(k) plan. When he answered yes, they told him that he was ineligible for SSA disability b/c he had more than $3,000 in his plan.

I know this isn't the best forum for this discussion, but I have looked all over for the determinative reasons for disability, and nowhere can I find anything pointing to a 401(k) plan having any affect on it. Any help would be much appreciated.

Thanks!

Can a qualified Profit Sharing Plan currently maintained through a Domestic Trust have its assets transferred to a Foreign Situs Trust and still receive tax exempt status and favorable tax treatment for contributions and distributions?

If you establish a "mirror 401k" plan i.e. nonqualified deferred compensation plan, that looks like a 401k using mutual funds and you provide employees with the ability to direct the investment of their account just like a 401k plan do you run afoul of an ERISA rules or regulations? if so, which ones and why? Thanks David Witz

May 401(a) hospital match contributions that otherwise would fail annual discrimination testing be , instead, deposited into a 457 plan over the course of the year as a means to prevent the potential discrimination test failure?

If so, what is the total annual maximum employee deferral and match that can be made to the 457 plan assuming the employee is less than 50 ?

Doug P.

Hi-

I have received conflicting information regarding when an employer contribution is due for a 12/31/01 plan year end with a fiscal year end of 3/31. I have been told (a) September 15, 2002 and (B) whenever the corporate tax is filed. Does anyone know which is the correct answer?

Is there any CLEAR authority on this ??? NQDC Participant (significant balance in rabbi trust) is getting divorced? Part wishes to divide NQDC benefits w/ spouse in same fashion as qualified plan benefits under QDRO. Appears to be some dissension as to whether QDRO applies to NQDC and, more importantly, whether the division of the NQDC can effectively transfer the income tax liability on NQDC distribution to the soon-to-be ex-spouse (e.g. LTR 9340032). Any help greatly apprectiated. THANKS

Is there any CLEAR authority on this ??? NQDC Participant (significant balance in rabbi trust) is getting divorced? Part wishes to divide NQDC benefits w/ spouse in same fashion as qualified plan benefits under QDRO. Appears to be some dissension as to whether QDRO applies to NQDC and, more importantly, whether the division of the NQDC can effectively transfer the income tax liability on NQDC distribution to the soon-to-be ex-spouse (e.g. LTR 9340032). Any help greatly apprectiated. THANKS

What is the authority of union contracts versus the plan document? Is there ever a situation where union contracts control the way the plan is administered rather than the plan document? To avoid having to amend each time a new contract is negotiated, can you incorporate the contract into the plan document by reference by inserting language like "the contribution percentage set forth in the current collective bargaining agreement between X and Y"?

Is it possible to have a freeze date later than 12/31/99??? Thanks.

i need a copy of i believe rev rul 84-45. the one that required that the discount for past earnings when computing a soc. sec benefit as part of an accd benefit, must be at least 6%.

thanks,

gary

Hi All,

I have a 401K plan from my previous employer, which I want to rollover. I have been thinking of first a Traditional IRA and then convert it to Roth. The reason I wish to do this is so that I may have cash available when I need it (I know it is not a good option to tap retirement funds like this). I have been doing a lot of reading and honestly I am totally confused.

My question is will I be penalised (10%) if I withdraw from my converted Roth IRA say after 2 months of deposit.

I have been more inclined towards Roth as I figure when I retire I may end up in a higher tax bracket. Is this a good option (Roth IRA that is).

Thanks in Advance

Just wanted to clarify an earlier post (which may have been a little confusing).

I'm a little confused with the determination of the expected retirement age (XRA) for a participant under ERISA 4044.

4044.55 deals with the XRA when a participant must retire from his job to begin receiving an early retirement benefit. 4044.56 deals with the XRA when a participant need not retire from his job to begin receiving an early retirement benefit. This latter situation does not appear to make sense (and would never apply) as in-service distributions are not permitted prior to normal retirement age.

Under ERISA 4010, a PBGC filing is required for single-employer plans with aggregate (within control group) UVB of > $50M. With this filing the value of plan benefit liabilities must be disclosed, using methods and assumptions as outlined under ERISA 4044. 4044.55 through 4044.57 deal with the determination of the XRA (expected retirement age) for valuing deferred benefits.

4044.55 deals with the XRA when a participant must retire from his job to begin receiving an early retirement benefit. 4044.56 deals with the XRA when a participant need not retire from his job to begin receiving an early retirement benefit. This latter situation does not appear to make sense as in-service distributions are not permitted prior to normal retirement age.

Thoughts?

When a beneficiary inherits several IRA's from the same individual (a parent who died at 77 years of age), is there any prohibition against combining all the IRA's into one? Since remaining distributions can come out over the beneficiaries life expectancy all the IRA's should be using the same factor to calcualte the minimum distribution. Thus, the distribuion amount should be the same whether they are combined or not.

Also, does the rule that agreggates IRA's for calculating the minimum distribution amount, but lets you take the calculated distribution from one or any combination of the IRA's, apply to inherited IRA's the same as it applies to an original account owner over 70 1/2. Thus, if 12 IRA's were inhereted, and they were with different custodians, could the required minimum distribution be calculated, based upon the beneficiaries life expectancy, and then the distribution come from any of the IRA's?

Thanks in advance for any guidance.

One of our tax partners heard that something has been released regarding recalculation (reduction) of the payment amount in an established series of substantially equal payments.

The specifics involve a situation where the market value of an IRA was severely reduced and there wouldn't be enough to fund the payments until the person attains age 59.5. If the recalculation is not allowed, the IRA will be drawn down to zero, thus triggering retroactive penalties. Apparently a PLR was issued.

Has anyone out seen anything on this? Thanks. Maverick

If a Self Employed person has a 401k plan and earns net income of $15,000 for 2002 and defers $11,000, would a profit sharing contribution be based on the $15,000 comp or would it be based on $4,000 comp?? Since the salary deferrals are not part of the 25% of comp deductible limit do i have to consider them for the comp used to calculate the profit sharing contribution?? Thanks.

An employer sponsors a DB plan, and makes the section 404 maximum deductible contribution to the plan, but spreads it out over the year (i.e. 2001 contribution made over 2002). Some of the contribution will be made after the due date for the company's tax return (9/15) and therefore not be deductible. Let's say the company has cash flow reasons to do this, and the 412 minimum is timely deposited by 9/15. Does this escape the section 4972 excise tax, in that it is not more than the "allowable" amount for the year? (The company plans to deduct the "extra" amount for 2002.)

Almost every account we administer is participant-directed and valued daily. There are no "pooled" investment options from which we can deduct fees. Each is a publicly-traded fund. Thus, when a fee is to be charged against plan assets, there is an itemization against the participant's account for the fee deduction. Since the charge is pro-rated across each participant's holdings, there can be a dozen transactions recorded if, for instance, the participant owns 12 separate funds off the menu list.

We try to hold off a deduction until there is a contribution, taking fees from cash rather than the proceeds of sales. But this is not always possible (and can be tough on cashflow).

I'm all in favor of full disclosure and transparency, but I'd like to minimize the number of transactions that are of record.

Can anyone share any creative ideas to consider? Or is this the "nature of the beast?"

Can someone give a verbal acceptance to COBRA within the required timeframe and then followup with the paperwork?

A controlled group contains 2 employers, each of which sponsor separate DB plans. The owner of the controlled group is an employee in each of the plans, collecting a separate salary and supposedly earning service under each of the plans. My initial reaction is that if the owner is sharing his time between the 2 companies and therefore accruing benefits under each in accordance with the plans- the following tests would need to be done to see if there are any restrictions:

Need to aggregate the benefits under 415.

Need to aggregate plans and test as one under 401(a)(4)- nondiscrimination.

Can anyone think of any other pitfalls? Should I be checking 401(l) if the plans are integrated with Social Security? I don't know what the benefit formulas are under each plan, other than they are salaried plans and one plan's average pay is capped at 75,000. There is no cap in the other plan. The employee makes more than 200,000 in salary for each of the employers.

I took a look at RR99-51- which states that "on the basis of all relevant facts and circumstances, the manner in which employees' service is credited for all purposes under the plan must not discriminate in favor of HCEs."

Thanks