We have a client who paid to the PBGC monies for 3 missing participants out of a terminating DB plan. Is the plan sponsor required to issue Form 1099's for these distributions? If so, to whom? If the participants are missing, can't issue to them.......Would a Form 1099 be issued to the PBGC?

Any thoughts would be appreciated.

Thanks.

Is there anywhere in the code that prohibits an owner of an LLC in a SIMPLE ira to not be able to receive the ER match?

We have just taken over an age weighted plan. We need to get the document amended by 2/28/02. Due to time constraints, we hope to put them in our nonstandard document and attach a resolution to adopt an age weighted formula. Any problems with that? I don't see why we can't, but maybe I am missing something.

Thanks for any help.

Owner A......Owns 80% of Company X other 20% owned by his wife

Owner A...owns 50% of Company Y and 50% owned by Owner B

Company X has 401(k) Plan...Do they have to include Company Y and can they exclude this company since Owner A doesn't have 80% ownership in this company?

Last week, a retired municipal 457 plan employee, age 54, rolled over his 457 plan balance into an IRA...thus becoming subject to the pre age 59 1/2 early withdrawal penalty.

Can this be reversed? Or fixed in any way?

Thanx,

James Jackson

entered into 72-t agreement 2 years ago at age 50. elected the highest amount to withdraw annually till age 59 1/2. based on IRA balance at that time, $400,000 annual payments projected to be approx. 29,000.

funds invested in biotech, which the market has not treated kindly. consequently the funds will run out prior to age 59 1/2 and i am told that the 10 % penalty would be assessed.

questions:

1. the 10 % penalty- will it be assessed on the original amount of 400,000 or on the amount received, say 250,000.

2. the 10 % penalty-will it be assessed in the year that the 72-t ceases to provide the 29,000 or do i have to amend all the prior years that i received withdrawals?

3. knowing that the plan will fail, can i elect out of the 72-t and pay the penalty for years that withdrawals were taken.

4. or, any other suggestions to get me out of this muck!!

many thanx

john

Is a 403(B) plan considered to be a "successor plan" for purposes of the rules applicable to distirbutions from 401(k) plans upon plan termination (Reg 1.401(k)-1(d)(3))?

Our dependent eligibility rules allow for full-time students over the age of 18 but under 23 to be enrolled in our health plans. We have an employee who a student is enrolled in an distance learning program for a vocational certficate as a Veterinary Assistant.

Would you consider this student as a "full-time student" or do they have to be in a "bricks and mortar" school to qualify?

Big Co. owns 65% of JV Co. Big Co. and JV Co. both maintain separate 401(k) plans but both plans participate in a master, group trust sponsored by Big. Co. for its affiliates (including JV Co.) where assets are tracked separately but combined for investment purposes. The master trust is therefore a group trust under Rev. Rul. 80-100. Both 401(k) plans allow participant-directed investments.

Big Co. sells all of its interest in JV Co. in March. Big Co. proposes to amend master trust to allow JV Co. 401(k) plan to stay in trust until December to allow smooth transition to new trustee, etc. JV Co. must leave the master trust by 12/31.

I have heard that this somehow creates problems under the securities laws but nothing specific has been articulated. Has anyone ever looked at something like this -- separate employers (although formerly related), separate plans but a single trust?

We have a client who has a Tandem arrangement between a nonqualified Rabbi Trust & a 401(k) Plan. The HCEs are encouraged to contribute to the Nonqualified plan, then at year end, we transfer the amount allowable under the ADP/ACP test into the 401(k) plan.

This has worked fairly well in past years, but now there are several HCEs who do not contribute to the NonQual plan, but contribute large amounts to the 401(k) plan. If, as in the past, we do our initial ADP/ACP test considering contributions made to both plans, & transfer the passing ADP/ACP amounts into the 401(k), then those who didn't participate in the Rabbi will get refunds (instead of just having some contributions remain in the Rabbi).

I'm wondering if we should only transfer amounts in from the Rabbi to the extent that the 401(k) plan will pass the ADP/ACP without refunds. But if we do that, then the HCEs who declined to participate in the Rabbi end up getting significantly more in the 401(k) than those who participate in the Rabbi. This seems unfair to those who do participate in the Rabbi, since the 401(k) plan is the better place to have your money.

The law seems to state that we can only transfer into the 401(k) amounts that do not "violate the ADP test." Yet the ADP test only establishes an average, not an individual maximum per se. What if the transfer amounts are fine for those who are getting the transfer, but force those who don't participate in the Rabbi to get a refund?

Is the plan able to require that HCEs contribute to the Rabbi? Has anyone else been through this? I don't see any guidence in the regulations. Thanks.

Grant

We have a 401(k) plan that is a multiple-employer plan. Two unrelated employers adopted the plan. Participants may direct investment into a fund consisting of employer securities. There are also other options in the investment menu.

We have Employer A and Employer B.

Is Employer A stock considered Qualifying Employer Securities with respect to employees of Employer B (and vice versa)?

If it makes any difference, Employers A and B were previously in a controlled group but due to ownership changes are no longer members of the controlled group.

Any thoughts?

I have a client who has mailed out the Notice to Interested Parties to all applicable parties, but she has also posted copies on bulletin boards and on their website.

Is there a time requirement of how long the Notice to Interested Parties must be posted?

Neither Rev. Proc. 2001-6, 2001-1 SEC. 18 nor SEC. 17 state how long the Notice should be displayed.

Any guidance would be greatly appreciated.

I always find the possible interrelationships of plan years, limitation years, compensation periods, and deduction periods somewhat challenging. Suppose you have a DB plan, with a calendar plan year 2001. Can they have a limitation year of 1-2-01 to 1-1-02, therefore allowing the higher EGTRRA limits? It seems to me that thay can - if so, what would be the down side, if any? Appreciate any comments.

We have 2 Canadian employees who have been on medical leave for over 3 years.

After 3 years, the collective bargaining contract considers the employee to

be

terminated.

I am unfamilar with Canadian benefits. Does Canadian law require certain benefits

to continue such as medical, LTD, and pension while on a medical leave?

What is a good reference source for Canadian benefits laws?

Thanks

We have 2 Canadian employees who have been on medical leave for over 3 years.

After 3 years, the collective bargaining contract considers the employee to

be

terminated.

I am unfamilar with Canadin benefits. Does Canadian law require certain

benefits

to continue such as medical, LTD, and pension while on a medical leave.

What is a good reference source for Canadian benefits laws?

Thanks

Please one more time short and simple:

In determining if an employee in a SARSEP (employer is a corporation) has deferred over the 15% of comp limit do you first exclude the deferral amount (i.e. total gross compensation minus deferral X 15%)?

In determining the deferral percentage for the ADP test in a SARSEP the deferral amount is a percentage of the total gross compensation (which includes the deferral), correct ?

Has any of this changed for plan years beginning in 2002?

(Glad I don't run into many of these) Thanks much.

In regard to a qualified plan, is the life expectancy of a participant who dies after reaching age 70 1/2 used to determine the distribution paid in the year of death or is it the life expectancy of the beneficiary? I was not sure in regard to the minimum distribution requirements whether a distribution could even be taken before the year after the year of death of the participant. Thank you!

We have a participant who worked for two companies and deferred more than $10,500 and has asked our plan to refund the excess amount. The amount we are refunding as excess deferrals was matched, but our counsel has told us that we do not need to forfeit the associated match as it is not a "plan correction" but a "participant tax correction" so that match should remain in her account. His argument is that she could have just as easily had us return the amount from the prior employer plan contributions (that were rolled over to us). However, we do not have the earnings information to do this calculation, so we are returning it from her deferral account instead. Any thoughts?

What about if a plan has a higher rate of match based on length of service. It seems that under the BRF "current availablity" test, age and service conditions are disregarded, so the test would automatically pass. However, I'm slightly confused on how the "effective availabity" test applies. This is based on how many employees can be expected to actually satsify the specific criteria. I would think that all employeees can be expected to satisfy it, assuming they stay employed. Does anyone have any thoughts on this?

Here is my situation:

Company A is owned 50/50 by two doctors. July 2001, they split with Dr. 1 remaining in the exsisting company and Dr. 2 forming a new company and taking half the employees with him. Dr. 2 received his max contribution of $35,000 under Company A's 401(k) PS and MPP Plans.

Two questions:

Do the employees now employed with Dr. 2 under Company B receive new 415 limits for their Company 2 comp?

Must the employees now employed by Dr. 2 be given the opportunity to withdraw their money from the MPP and 401(k) Plans from Company A, or can that money automatically be transfered to new 401(k) and MPP Plans under Company B?