This may be a very stupid question, but I thought I remembered that companies with more than 50 employees must provide a health benefit plan(s) for their employees to participate in.

Is this true? Any there any minimums at all?

The reason I ask is, my husband is probably about to become the first US employee of a small European based firm. They have asked him to prepare some information on standard compensation packages in the US, including benefits (health and retirement).

I've found good information on the types of reitrement plans that may be offered, including limits on employee size, etc. And we think that a safe harbor 401(k) may be a good option to present. However, we're having trouble gathering all the information about health insurance.

We know that a plan for a small number of employees will be cost prohibitive, and that I have the option to carry him on my insurance. But we'd like to present an option that would help us to offset the additional "spouse" premium I have to pay, which is quite significant.

We want the employer to understand that he is not legally required to provide these benefits, but we want to make it clear to him that a good benefits package is key to attracting employees in the US.

Any ideas?

Fifty year old client rolled large 401k dist to IRA and is now taking a series of payments (about 45k per year). So far, she has taken 2 annual payments. She now needs 50k to buy a business. I think there was a discussion thread on the consequences of changing the amount of payments, but I can't find it, so I'd appreciate comments on the following:

- Already took 45k in 2002, draws another 50k: Is the 10% exception gone for 2002 and/or prior years?

- Future years: Assuming she takes the extra 50k in 2002, can she revert back to 45k in 2003 and forward?

- What about setting up a 401k plan, rolling 100% of the IRA into it, then taking a participant loan for 50k? Would this "cancel" the 10% exception on 2002 and prior dists?

Thanks all. Maverick

We are in the process of reviewing/amending our current Annual Performance Appraisal process. Does anyone have a system that links company performance and individual metrics in such a process?

Are there any sites where such processes and systems can be viewed and compared?

Kindly provide your thoughts and ideas so that a thorough review can be conducted and a more informative and constructive process can be the end result.

Thank you!

Jerry

If a participant in a DC plan turns 70 1/2 in December of 2002, it was my understanding that age 70 should be used to calculate the first RMD regardless of whether the distribution occurred in 2002 or by April 1, 2003. Someone has told me that if the first distribution occurs in 2003 it should be based on the age the particpant turns in 2003, in this case 71. I don't think that is correct, but couldn't find anything definite in the regs for either case. Any help would be appreciated.

Are loans for key employees in a top heavy plan prohibited??? Thanks!

NQDC Plan provides for payment to a Company's President when he steps down as President. The Ex-President will keep working for the Company as an executive after he steps down. Significantly, the NQDC is between a private foundation and the President -- rather than between the Company and the President -- even though the amounts to be paid from the NQDC are clearly being paid to the Ex-President in connection with his excellent service as President for the Company. Therefore, the private foundation, rather than the Company, will be paying the deferred compensation. The deferred compensation will be paid to the Ex-President at a time when he is also receiving wages subject to employment tax and income tax withholding from the Company in his role as Company executive.

Is the deferred compensation from the private foundation "wages" that are subject to employment taxes and income tax withholding? The private foundation is not, and has never been, the employer.

Any thoughts?

Is the “Payer’s state no. the same EIN they use for their Federal ID Number? Os is the state required to issue these ID numbers to payer’s?

A few of our employees have called in asking that our healthcare provider omit their SSN's from display on medical & prescription id cards (apparantly they have had a problem in the past with identity theft). Our healthcare provider cannot do this currently.

Do the employees currently have a legal recourse to require this ?

I know that CA has a law in place currently SB 168 for CA residents effective in the next 2 years for current group insured plans

Are there any other states out there with simialr laws to CA?

What about federal law(s)?

Thanks

Company A has a flexible benefits plan where Company A employees can use "pre-tax dollars" towards the payment of premiums for a group medical and dental plan that is sponsored by Company B. Company B is not part of Company A's controlled group. Does Section 125 require that the underlying plans in a flex benefits plan be sponsored by the employer or a member of the employer's controlled group? Put another way, would Company A employees here recognize income and essentially lose the pre-tax benefit under Section 125 since the group medical and dental plan is not sponsored by the employer? Is there something in the regs and/or statute that covers this question?? ANY thoughts would be highly appreciated. :confused:

Due to EGTRRA I want to amend an existing Money Purchase Plan to a Profit Sharing Plan, for the calendar year 2002. What documentation is needed? What is the deadline, to avoid a 2002 contribution to the money purchase plan? Document is non-std. prototype with end of year employment requirement. Is 204(h) notice needed?

Can a financial institution who is NOT a "designated financial institution" impose a minimum contribution requirement in order to open a SIMPLE IRA account at that institution?

As I read Notice 98-4, Q & A D-2, it mentions that the employer cannot impose a maximum.

I'm thinking that since the SIMPLE is not w/a DFI, any financial institution can impose a minimum contribution in order to open the account. Some financial institutions may want to impose a minimum contribution amount to circumvent having to open a SIMPLE IRA account for an individual who elects to have only $5/$10/$15 withheld per pay period. For some financial institutions, the account would not be profitable to administer.

My second question is if you are aware of financial institutions who do in fact require a certain minimum contribution, how do they handle disclosure to the participant of that fact?

If a plan sponsor is 9 months late in depositing 401(k) deferrals, and chooses to use the Federal short-term rate + 3 interest rate option, how is this applied? The Federal short-term rate changes quarterly. Should the changes be taken into account?

For example, say the Federal short-term rate + 3 is 8% in the quarter in which the deferrals should have been deposited, 7% for the next quarter, and 9% for the next quarter. Should the 8%, 9% and 7% rates be used? Or should the 8% rate be used for all 9 months?

Has anyone had experience with the DOL on this issue that involved more than one quarter?

We have taken over a plan with a 30 year history. At one time the plan allowed for after-tax contributions, before adding a 401(k) feature and doing away with the after-tax option. The prior recordkeeper will not provide us with an after-tax basis for those participants who still have after-tax balances. My gut feeling is that it was never properly record-kept, so there are no records.

My question is, who is ultimately responsible for this reporting and to what degree should the trustees pursue the information (obtain legal council)? The Trustees are very concerned that Participants may revert to them as not doing their job because these numbers are not available .

Is it ultimately the participant's responsibility to tell the IRS what's taxable and what's not taxable when they finally recieve a distribution?

Thank you.

We have two cross-tested profit sharing plans that for their 2001 calendar plan year, want to retroactvely amend their discretionary contribution allocation formulas. In each case an addtional group would be 'carved out".

One will result in an addtional contribution for a Non-Highly Compensated Employee (over and above the 3% Safe Harbor contribution) and the other results in an additional contribution for a Highly Compensated Participant (over and above a 3% of pay across the board contribution). Neither employer has made a formal approval of the contribution for 2001.

If an employee terminates just prior to the end of a plan year but has deferrals taken out of the final paycheck, which is received in the next plan year, how is testing completed? Say the years are calendar year 2001 and 2002. Are the deferrals received in 2002 counted for ADP testing for 2002 even though the employee terminated in 2001? Are the deferrals counted in the 2001 ADP test even though the paycheck was in 2002? Does the answer affect employees who were eligible to defer during the payroll period, terminated in 2001, and did not defer from the final paycheck (which year's ADP test should include them)? Should the 2002 410(B) coverage test include either of these types of employees? Has the IRS ever provided formal or informal guidance on this issue when a payroll period crosses over a plan year end?

An employee who was terminated for cause won reinstatement along with back pay for all of last year. The question: Can he contribute to 403b and have it count to last year when we pay him his back pay this year? And if he can, how do you report it on his W-2?

Is it legal to have several different Roth IRA's from different providers (started in different years)? Any big benefits to keeping them all together?

A partnership has a profit sharing plan. Each partner participant makes his own Keogh contribution. Each partner participant is free to find & use any broker and investments that he so chooses. The partnership makes a annual discretionary PSP contribution for the regular employee participants..... however, the regular employee participants are not allowed to choose where their share of the discretionary contribution will be invested (the partnership decides where to contribute the discretionary contribution).

Is this an ERISA violation? Can it disqualify the plan ?

Has anyone heard anything on GUST & EGTRRA restatements for DB plans? At ASPA the Service was adamant that apporval would be no later than 1/31/02, however I have not seen any anouncement. I quess we will now have have until at least 3/31/03 to restate DB plans, on prototypes and specimen documents( volume submitters).

Employer checked off (X) NONE on standardized adoption agreement for employer discretionary profit sharing contribution to their 401(k) plan, but then went ahead and made profit sharing contribs for two prior years anyway. What should they do now to correct, if anything. New restated doc is all set going foreword...