Can an employee collect both employee sponsored STD and Social Security benefits?

In order to receive Sub TA fees from American Funds Service Company (AFS) we must provide them with data from Relius on every plan that holds or offers American Funds.

One of our staff members had been told at a user's group meeting that there was a custom report out there that they could provide us in order to get this information to AFS. No one seems to be able to find this report and the data that AFS is requesting on a quarterly basis is staggering.

Does anyone out there know of any reports that have been created for this purpose?

Check this site. It has what appears to be an up-to-date and comprehensive list by state.

http://www.americanbenefitscouncil.org/

My 69 year old mother passed away in November 2001 leaving me, the sole beneficiary, with her $170k IRA. I plan to change the titling on the account to an Inherited IRA and begin taking distributions over my life expectancy. I have two questions:

1) Do I just use the single life expectancy table or is there a special one for accounts titled Inherited IRA?

2) Can I withdraw more than is required in any one year, as determined by the life expectancy table? ie. I'd like to start by withdrawing $15k to pay bills.

Thank you

When a 401k plan fails testing and must have money removed by 3/15 for an employee, (1) In what year is the refund to the employee taxable? (2) Who reports the refund to the IRS? (3) Does the W-2 for the employee need to be corrected? Thank you for any help you can provide on this subject.

My understanding is that a plan sponsor may choose to rely on either the 1987 proposed regs or the 2001 proposed regs for determining Required Minimum Distributions due by 12/31/02. Is there any guidance on how a plan sponsor must specify this choice, and if there is any consistency requirement regarding the choice? [Can an employer rely on the 1987 regs for some calcs, and the 2001 regs for other calcs? Once an employer has relied on the 2001 regs for some calcs, can the plan sponsor decide to change back to 1987 regs for other calcs on a go-forward basis?]

Can anyone tell me if the courts have been sympathetic to participants in these plans in the event of bankruptcy when all the contributions have been employee deferrals (no employer contributions)? Or have they just put them in line with the rest of the creditors.

One of our agents called me with this question. A non-profit employer has a 2 year old 401(k) profit sharing plan. Previously they maintained a 403b (for approx. 10 years). At the plan year end, they calculate their profit sharing contribution. In preparation to send the money in, the employer requests that employees with no investment instructions on file fill out enrollment forms. There have been a couple of employees who have refused and continue to refuse to fill out the forms and tell the employer that they don't want the contributions!!!! They have also filled out "waiver forms".

I informed the agent that I think the employer should send the money in for the employees anyway, setting accounts up for these employees and the trustee should choose the investments. I also told him that in the case of an audit the employer could be responsible for paying the contributions for the past 10+ years to those employees who refused them plus interest.

Could anybody give me some feedback as to whether the employer is allowed to just not give the profit sharing contribution if the employee says they don't want it?

As I read the EGTRRA changes to 457 plans, the extension of the QDRO rules only applies to 457(B) plans, not (f) plans. So, does this mean anything has changed with respect to a payment from a 457(f) plan pursuant to a divorce? For example, if such a payment were made to an ex-spouse, I assume the participant would be taxed on the amount. Would FICA taxes be due as well?

Thanks for any help.

Since Age weighted profit sharing plans are not permitted to be amended as part of a volume submitter or prototype plan:

What should an employer do, who adopted such a plan from a document provider who did not receive an opinion letter for the plan?

Let’s say an employer , who has his/her age-weighted plan at another custodian, wants to transfer the plan assets to this custodian who does not have an opinion letter for the plan, is completing amendment and restatement documents ( for GUST and EGTRRA) sufficient? There is still no opinion letter.

Lastly, is it true that the IRS has never issued an opinion letter for an age-weighted plan?

Is the following participant eligible to make catch-up contributions due to a "plan imposed limit?" Assume that the below limits are stipulated by the terms of the plan document and that the participant would not otherwise meet the 402(g) limit.

Plan Imposed Overall Deferral Limit (Sum of Pre-tax and After-Tax Rates): 25%

Participant Elected Pre-Tax Deferral Rate: 15%

Participant Elected After-Tax Deferral Rate: 10%

Thanks for any assistance.

I have a client who employs a lot of Hispanic workers for their quarry. One of the things I've encountered is employees using the same SSN, changing their name, etc. There's also a great deal of rehire activity. Most of these people don't meet eligibility (21 & 1, semi), but some do. Those that do, very few actually contribute.

I think the employer does make an effort to verify the information and SSN. My contact has mentioned talking to the SSA about these issues. I have asked the employer for clarification on many people, but sometimes wonder how much follow through is reasonable. I only think this based on the low number that do meet eligibility and the low number that contribute. If the plan were ever to be audited, how might the Service view this situation?

Thanks in advance for any insight on this.

Has NY and CA adopted EGTRRA?

I have read several things since the Technical Correction that says the SEP limit is now 25% of "grossed-up" compensation. What does that mean?

For the self-employed, is it 25% of includible compenation, after the contribution (or 20% of compensation before the contribution), as figured previously?

I am told that when a participant in a 401(k) plan has wage less than the limit for the social security wage base of $84,500 (i.e., @$72,000), the participant should not maximize the elective deferral because a reduction in the participant's salary would take it below the social security wage base would be best since employer contribuitons are not subject to employment taxes. Does this mean that the participant should not make the maximum elective deferral of $11,000 (and $29,000 for employer contribution so as not to exceed the annual addition limit) but instead, maximize the employer contribution (@$39,000 is availble to him)?

This does not make sense to me because while elective deferrals are included in the social security wage base, nevertheless, they reduce the income tax so is it not still better to maximize the elective deferrals?

Please, can someone explain it to me, a novice in the field? Thanks.

Caroline.

Can someone please advise me on the following question about qualifying dental expense status under our Medical FSA:

Employee has chipped front tooth and there is a noticeable color difference between the exposed chipped tooth and the enamel of the other teeth. Employee would like to use her FSA to pay for "laser power bleaching" performed in dental office by Dentist in conjunction with the repair to the chipped tooth. This combination of procedures would ensure that the repair of the chipped tooth is unnoticeable in her smile. Is this dental expense reimbursable by FSA?

Thanks so much for your help!

Would it be possible pursuant to a QDRO or otherwise for a former spouse to be designated the beneficiary of a life insurance policy held by a plan, for the life of the partiicpant spouse?

I am aware of the following thread:

http://benefitslink.com/boards/index.php?showtopic=4395

If someone did not receive compensation in a year can they be deemed to have performed service for SEP eligibility? Owner of an S-Corp received no compensation in 1999 he received his first compensation in Feb. 2000. In 2000 he also had another employee start work. This employee was terminated in Feb 2002. The S-Corp owner wants to set up a SEP with a two out of the immediately preceding 5 year service requirement count his 1999 service and therefore exclude the other employee that started in 2000. What determines performed service?

It's my understanding that plans may not be aggregated for nondiscrimination testing unless they have been treated as permisssively aggregated for coverage purposes (see Treas. Reg. §1.401(a)(4)-9(a)). To be permissively aggregated, the plans must have the same plan year (see Treas. Reg. §1.410(B)-7(d)(5)).

So, now Company A and Company B are part of a controlled group. Company A's 401 (k) plan year ends June 30 and Company B's 401 (k) plan year ends December 31. If I'm understanding the regs correctly, I should never combine ADP/ACP tests for both plans. Does anyone have a different view of the regs?

Also, when performing the coverage tests under 410 (B), if I cannot permissively aggregate, what is the approach for testing coverage of the two plans?

Thanks to all that can help.

May a plan document allow a participant to make a one-time opt out of plan participation for all purposes OTHER than salary deferrals?

I am looking at a prototype adoption agreement that appears to allow this, but something does not seem right.