If Carve- out is used to pass ADP/ACP do you have to go back and re-test 410(B) using carve-out also?

Is there a table of historic rates for section 415 post-separation COLAs? I believe the rate for 2001 was 1.0351 and 1999 was 1.0160. Also, how are these rates calculated? Presumably, these are simply CPI adjustments of some sort.

I am with a TPA firm, and we are planning to switch from our current in-house administrative software to that of a software provider. We want a conprehensive application, and so far my top choices are Corbel, ASC and Datair.

Anyone have someone comments or advice on what software to use?

We also want to implement daily valuations, and are leaning towards BenefitStreet, Corbel or Fidelity. Anyone have any suggestions in that arena too.

Thanks in advance for you help

Joost Revis

Because I anticipate a much lower income in 2002 than I had last year, I am considering a regular IRA contribution for 2001 and then recharacterizing as a Roth sometime this year when my taxes will be significantly lower. Is this permitted and does this make sense to do? Thanks for any help.

A participant's distribution form was lost for a while. We found it and are processing the participant's claim. This is taking about 6 months more than our usual time, but still within the 60-day provision of the plan document (401(a)(14) rule). The participant feels she is entitled to lost earnings. Does she have a valid claim because it was beyond our normal processing time or not because it is within 60 days of the later of normal retirement, 10 years of service or termination of service?

If we want to pay her lost earnings anyway, can we make an additional contribution to the plan that will be treated as earnings only for this participant or will we be violating the plan's allocation provisions by applying it only to the participant?

Thanks.

Can a person in a 403b ( still working for the school ) roll the 403b to an IRA now? I am aware of the 90-24 transfer from 403b to 403b, but under the new laws - is it possible to roll to an IRA without a triggerring event having to have taken place?

I am not as knowledgeable as a lot of you folks so take it easy in the jargon, please explain in English so that I can then explain it to the few hundred teachers that have asked me.

Thanks:confused:

A participant's distribution form was lost for a while. We found it and are processing the participant's claim. This is taking about 6 months more than our usual time, but still within the 60-day provision of the plan document (401(a)(14) rule). The participant feels she is entitled to lost earnings. Does she have a valid claim because it was beyond our normal processing time or not because it is within 60 days of the later of normal retirement, 10 years of service or termination of service?

If we want to pay her lost earnings anyway, can we make an additional contribution to the plan that will be treated as earnings only for this participant or will we be violating the plan's allocation provisions by applying it only to the participant?

Thanks.

One Owner owns two distinct and separate companies. It is a controlled group, but also QSLOB. One company has nothing to do with the other, no overlapping employees. Each company has it's own 401k plan. Should or must the plans be tested on an aggregate basis or could each plan be tested on it's own for ADP & ACP as well as 410(B). Thanks.

For what it's worth, I now drive a 4X4, so perhaps these test drives contributed to that, which means at least one car salesperson scored a sale - albeit at the expense of some others.

1. I was only recently reminded that I once "test drove" a Toyota 4X4 used vehicle for the express purpose of transporting my bicycle (badly broken) to the repair shop. I was without any bike rack or suitable vehicle. I had strategically brought a friend and chose a used truck with only the standard cab and bucket seats - meaning there was only room for two. As it was used - and minus the backseat - the salesperson let us take it out on our own. We transported the bike - driving right by the same dealer. Then, as we had made such good time, we proceeded to move something of my friends from one house to another. This didn't require a truck - but a truck made it much easier.

2. I was in the market for an SUV for some years - looking first at used vehicles. Wishing to test drive a used Chevy S10 Blazer, I took one out one winter evening and drove direct to the only new construction area I was aware of. I planned to use the 4 wheel drive in a tour of dirt roads. Unfortunately, I took a wrong turn and drove not onto a dirt road covered by snow, but an actual snow covered field with no road! I was terribly afraid of becoming stuck and having to explain myself to the car dealer. I put the pedal down (probably harder than I had to) to keep the wheels turning. It was a wide turn (to miss some trees) and I was in the field longer than I would've liked. We made it out of the field and headed back. It was only upon parking at the dealer lot and exiting the vehicle that I realized the SUV was coated in mud - not road slush/grime - but MUD. The salesperson met me at the vehicle and with eyes wide and mouth agape, he listened to my story about the semi truck, that had no business on the two lane road I crossed paths with him, which had kicked up soo much grime onto the vehicle.

I know these vehicles have fans and detractors. Mine does to off-road and tows a trailer, leaving me a choice between a truck and an SUV. The SUV does better on mileage than the truck.

Hello,

Any insight will be appreciated. I have a plan sponsor who has amended its Plan for GUST. They did not "declare" the method in the Plan Document and apparently counsel does not believe this is required. It was my understanding that the IRS requires that the testing methods be identified within the document itself, and therefore requiring a formal amendment to change in future years?

If someone could confirm my understanding or lack thereof, it will appreciated.

Does anyone have a definitive answer on the IRS position regarding whether you have to 100% vest participants in a MP plan that is being merged with a PS plan?

Can former employees who are still receiving payments from a deferred compensation plan sponsored by the former employer (still receiving a W-2) defer some of that compensation into a premium only cafereria plan to pay for their health insurance?

The regs define employee to include former employees; however, my research indicates that former employees may not reduce their pension income as if it were wages or salary; that is, any contributions by former employees must be made with after-tax dollars.......

Any comments would be appreciated. Thanks.

About a week ago , I posted the following :

"I transferred funds out of my company's 401(K) into a "self-directed" IRA and then converted the IRA into a ROTH ( and paid the subsequent taxes).

Can I now put additional funds into my ROTH , without having to transfer/convert more of 401(K) ?"

I received two posts stating that I CAN contribute funds aside from IRA conversions BUT upon reading IRS form 5305-R, Article 1, Item (2) states :

"If this Roth IRA is designated as a ROTH Conversion IRA , no contributions other than IRA Conversion Contributions made during the same tax year will be accepted."

Wouldn't my conversion be classified as a ROTH Coversion IRA ?

Yep - now I'm confused......

I converted a traditional IRA to a Roth in 1998. Paying the tax thereon over 4 years. Will pay my last tax on the conversion in 2001. I am 65 years of age. One of the securities in that Roth account has gone from a 1998 price of $100 a share to a current price under $1. I paid my tax calculated on $100. Can I, after 2002, withdraw that security from my Roth account; deposit it in a non-IRA brokerage account; sell that security for $1, and claim a capital loss of $99?

When a client contributes 401(k) contributions late (past the 15th business day following the month in which the contributions were due), what is the penalty calculated on?

The total amounts of the 401(k) contributions plus any earnings?

or

Only the amount of the earnings attributable to the late deposits?

Whichever reason, can you tell me why and where I can see it in writing.

Thanks!

Prior to being amended for EGTRRA, a defined benefit plan limits compensation to "the amount prescribed by Code Section 401(a)(17)." The plan sponsor does not want to recognize the EGTRRA increase and wants to keep the limit at $170,000. Can the sponsor amend the plan now (February 2002) to provide that, effective 1/1/02, compensation is limited to $170,000, or is it too late? My concern is that, by incorporating 401(a)(17) by reference, the limit under the plan automatically became $200,000 on 1/1/02, so that a retroactive amendment now would be a prohibited cutback. Thoughts, anyone?

I've got an adopter of a volume submitter 401(k) plan which was adopted back in 1997. Employer never submitted plan to IRS for a determination letter. Operational defects abound. To what extent might employer meet "favorable letter" requirement of Rev Proc 2001-17?

I am sending out SPD's for our FSA enrollees. Do I need to send an SPD to 2002 enrollees who were also in the plan for 2001 and received an SPD at that time?

Does anyone know where I can find a sample Plan Document on the net for a non-qualified deferred compensation plan?

Restating a Principal Financial Group non-std prototype plan this morning and could not find a named trustee, but did find this text: "The plan is not trusteed. Plan assets shall be invested only in an annuity contract."

I guess the trustee section of the adoption agreement is left blank, but what about the Schedule P?

You learn something every day in this business. Thanks. Maverick