Is there a regulated time limit in which employers must send in employee deferrals to a 403(B) Plan.

If so, are there penalties for non-compliance.

Thanks

Can anyone briefly explain to me these differences...i am not a rocket Scientist....so I need help !

Thanks.:confused:

I have a prospect meeting next week, and the thought just struck me - what are the client's options if they have not signed a letter of intent to adopt someone's prototype? I know that you do receive the extension of time to 12/31/02 (calendar year plan) if you continue with the same entity that sponsored your pre-GUST prototype, but I am curious about the effect of switching in this "interim" period.

TIA

My company is considering engaging a financial advice provider for our 401(k) plan. We are considering a provider that we own a small part of (it could be around 10%). Would it be a prohibited transaction to hire that provider?

My company is considering engaging a financial advice provider for our 401(k) plan. We are considering a provider that we own a small part of (it could be around 10%). Would it be a prohibited transaction to hire that provider?

I posted this under the 5500 topic as well. If a Flexible Spending Account Plan terminated on 12/31/01 and participants are still within the closing period to submit claims (assets are still in the account), would the employer file a final year filing for the 2001 plan year or after the close out period in 2002? (A 2002 short/final year filing)

:eek:

We have a self-funded Indemnity plan, the plan has a $100.00 individual deductible, $200.00 family deductible, then plan will pay 80% within UCR. Correct me if I am wrong. An employee has not incurred any medical expenses this year as of yet, but his dependents have (so far $195.00). The employee says that the plan should have paid the claims after the $100.00 was met. I told him and my benefits coordinator that the claims were processed accurately. Because the $200.00 must be met before the plan will pay the claim. They are saying that the employee's deductible has nothing to do with the family's deductible. I said not so, because again the plan has a $200.00 deductible. When the $200.00 has been met then we will pay any claims, and the employee does not have meet his $100.00 because his dependents have met the $200.00 with their claims. Is there anywhere or anything I can put my hands on to show them that a family includes the employee and the dependents. Thanks.

I have seen a number of references to filing a final form 5500 for pension plans with left over assets. Based on the 2001 filing instructions, I believe this would apply to left over funds in a Flexible Spending Account. Am I correct with this determination? Here is the situation:

I have a client that has canceled their calendar year plan as of 12/31/01. Though no further claims can be incurred for that plan year, the participants are still within the closing period to submit claims for that plan year and there are still funds available in the account. Would the 2001 filing be a final year filing or would they have to file a final year filing for 2002, after the account has a zero balance?

What is the corrective action that should be taken if stocks (or any other investment other than domestic mutual funds or other regulated investment companies) are invested in a 4039b)(7) account?

Is the 403(B)(7) account disqualified?

Thanks for your help

Shelton

In prior years the plan exluded commissions from the definition of compensation. The employer know wants to use full compensation. Is it possible incorporating a more inclusive definition of compensation to be a cut back of benefits? For example, if this change benefits HCE's because they earn more commissions.

What issues arise where cross-tested PSP has classes defined as a specific individual,e.g., Class A is Joe Jones, Class B is Jim Smith, etc...? Thanks for your help.

Does 3401(a) compensation include deferrals to a Section 125 plan?

Excuse this if this is a duplication.

Start with a regular IRA party non-deductible. Now take a 401-k amd roll it into a new IRA. Take the new IRA and convert all of it and only it into a Roth (this actually already done in 1998 and spread 4 years).

Is the entire conversion the correct taxable amount or must all the IRAs be totalled and the basis % figured with the result being that some of the conversion is non-taxable just like any other distribution. I believe this is correct but I have seen examples that hint otherwise and show a basis in one year and not another in showing consequtive distributions and conversions so I am unsure. Can this 401-k rolover and conversion be treated in isolation since it stayed intact and was never comingled or must the non-deductible basis be considered??

I see in other messages that any 1998 non-deductible contributions cannot be changed into Roth but I assume that I can amend 1998, 1999 and 2000 to correct the conversion amount (if indeed the basis needs to be considered).

If a married couple has a Roth IRA that they've paid into for a couple of years, and they don't want to close the entire Roth IRA account...but, this year they've made excess contributions 'cause their income is too high:

1) Can one spouse take the $120 hit on one Roth IRA (maybe made a goodly sum on their IRA) and the other spouse withdraw the contribution to the other Roth IRA (their investments stunk)?

2) If the contributions are withdrawn, must the person identify those stocks/funds/earning/etc which were paid for specifically by the 2001 contribution?

Thanks, KG

Client has contributory group life plan. Has allocated demutualization proceeds between employer and employees, and has established a custodial account with Pru under the DOL Trust Policy, to be used to provide a premium holiday to employees.

What the heck is the tax impact of this?

When client instructs Pru to sell the stock, and use the proceeds for the premium holiday-

Is client taxed on the gain?

Does client get an immediate corresponding deduction? Do the section 419 welfare benefit rules apply?

Is there imputed income to employees? Is this an employer contribution under section 79, or is this an employee contribution?

My guess is that since this custodial account is not a separate taxable entity, the client has to take the proceeds of the stock sale into income; the client gets a corresponding deduction for the contribution to the group life premium; and the employees have imputed income.

Except for the imputed income, the net affect of handling the transaction this way is that the proceeds wind up as nontaxable. But had the stock been distributed instead to the employees, they would have tax liability on the sale of the shares.

Anyone work through this????????

Thanks-

card

For the Cash Balance plan, if the formula provides different benefits for different classes of participants, does the Cash Balance Plan need to pass the Rate Group Test if all plans pass the average benefits test and the Gateway DB/DC combo.

Are plan sponsors required to mail an annual COBRA notice to employees? We provide COBRA information upon a qualifying event and also in the SPD's but the SPD is not necessarily updated annually. I understand that the Women's Cancer Rights must be mailed annually, could we include the COBRA notice with this or does it have to be mailed separately if an annual COBRA notice is required?

Is a workman's comp. plan a qualified plan? An H.R. person for one of the companies I deal with mentioned that she'd heard that they don't need a fidelity bond to insure the assets in their W.C. Plan any longer. Instead, they can use a portion of the assets in the plan to secure the assets. Does anyone know if this is true? If so, how would you go about securing the assets?

HR allowed an employee to begin deferring July 1, 2001.--They are not eligible until January 1, 2002.

As I read the rules the fix is to retro amend to include the ineligible employee.

Can I amend to include this employee by name or do I need to come up with some objective measurement to bring them in?

I have a client that recently purchased a company and has terminated the existing 125 plan previously sponsored by the aquired company. The question has been raised as to whether or not the employees from the aquired company have the right to incur expenses and submit them for reimbursement through their FSA's [through the end of what would have been the Plan Year; 12/31], or are they cut off as of the day of Plan termination.

Any thoughts would be helpful.