A participant is enquiring about whether or not he can defer on a bonus, paid in 2002 that was earned in 2001, for the 2001 plan year. Treas. Reg 1.415-2(d)(5)(ii) states that you can do this if these payments are made within the first few weeks of the next plan year. Does anyone have any idea as to how much time "few weeks" indicates?

My first thought is that if it wasn't made by January 31, it couldn't be included in 2001 as compensation for the 1099r filings. However, I guess you could make a case that a few weeks extends beyond January.

If anyone has any guidance on this issue or a relevant case study, I would appreciate it.

Outside of stock, which would obviously not be worth much, how safe are the other investments in a 401k? For example, say I have 4 mutual funds, that my money is equally distributed. If my company goes bankrupt, are the mutual fund monies protected? If so, where can I find the legal documentation stating so? If it is not protected, then the option is to roll the 401K money out of the company plan and into IRA's?

As trustee, if you are taking investment directions from a QPAM, is your liability in some way limited because of the QPAM;s status.

or, in the alternative, does that simply permit investment types which would otherwise be deemed prohibited transactions.??

it was my understanding that if investments were being directed by a QPAM the trustee/custodian/fiduciary was in some way relieved of liability regarding those investments.

can anyone confirm, deny or explain this in a bit of detail please.

many thanks.

The document we use provides that employees must be able to revoke a salary reduction election at any time. The ER can chose how frequently they want to allow other modifications to be made. The client wants to know why he has to allow revocations at any time. I'm not finding this requirement in the Code or Regulations. Is this a statutory requirement? If so, what is the cite? Thank you

An individually drafted plan document was amended for 2001 so that all employer stock in the plan is part of the ESOP. This allows the plan to take full advantage of the 404(k) deductibility. When performing the ADP test, the employer stock contributions are seperated from the other investment contributions per Treas Reg 1.401(k)-1(g)(1)(B).

Issue: The plan has been restated for GUST with prior year NHCE percentages being used for ADP testing. Since the plan did not segregate employer contributions that were salary deferrals in 2000, I'm not sure what approach I should take?

The sponsor does not want to amend to current year due to planning considerations with HCEs going forward.

Any suggestions or comments are greatly appreciated.

Thanks

Brian

Is it acceptable for a Multiemployer Plan to charge Employers who fail to respond to requests for participant (employee) information a fee for failure to comply with the request? Is anyone using this administrative practice? Or does anyone know of any restrictions that would prevent its use? Thanks in advance for your help.

Two plans of the employer are aggregated for testing. One is a DB and the other a DC. The DB plan's accrual is based on compensation for the whole year. The DC plan's allocation is based on compensation from DOPE.

Would I be able to test using the compensation from DOPE or would I have to use it for the whole year?

I have a current 403(B) client who has been told that they are able to convert the 403(B) to a 401(k). Is there pending legisation that would allow this?

Can anyone give me some guidence on this issue? I took over plan that has allowed hardships to be paid to participants. The plan document does not allow them. The processed hardships were in a prior year. How can I correct this?

Our city has a 457 deferred compensation plan. The approved product providers are Great-West Life, Nationwide, Equitable, and ICMA.

Is there any governmental rules, IRS regulations, or laws, that would restrict an employee or retiree from transferring their account balance to a 457 product provider other than those listed above as approved product providers?

In other words...can a 457 plan participant transfer their account balance to any product provider qualified to accept the transfer...just as a 403(B) participant can do a 90-24 transfer?

Thanx,

James Jackson

Dad (84 years old) died May 2001 before taking his required minimum distribution for tax year 2001 RMD was taken in Dec. 2001 and distributed to the beneficiarys...... I am the executor and one of 2 beneficiaries of the IRA

Just got off the phone with Fidelity. They reported my dad's MRD under his SS number even though the MRD was taken out after he died and the distribution was given to the beneficiaries. I have attempted to get Fidelity to issue a corrected 1099-R for them to report the distribution to myself and my brother--the beneficiaries!!! Fidelity has stated that the distribution (of 20,000.00=MRD) SHOULD go to my father and be reported as income to him!!! Is this correct??!!!Dad had thousands over 35000.00 in medical expenses that can easily be deductible! I cannot claim him as a dependent so therefore eating alot of medical deductions since his only income for 2001 was 6000.00. (This really works in my favor--not to have to report this income as my own but feel that this is wrong advice.)IS IT? After the conversation with Fidelity... I do not think I will be getting a corrected 1099-R and they have me believing that his MRD can be reported as income on HIS tax return. Can I legally report his RMD as his income even though it was recieved after death?

Julie

:confused:

Employer sponsors a money purchase plan and the plan year end is 9/30/01. Employer is having financial hardship and does not think they will be able to deposit the contribution by the filing deadline of their corporate tax return. The are past the 2 1/2 month deadline after the plan year end to apply for a minimum funding waiver. What options are available to the employer, if any.

What governs rounding of the EBAR or Employee Benefit Percentage for Average Benefits testing purposes? Is there a requirement? I haven't found one.

Please advise on a simple eligibility question.

My mother is retired.

For tax year 2001 she drews Social Security and had income from the sale of equities.

Being retired, can she contribute to her IRA and gain the benefit of the tax deduction?

My advice to date is no.

Thanks

Brian

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