Is a hedge fund required to report UBTI to a tax-exempt investor? Alternatively, is it the tax-exempt investor's responsibility to determine whether income is UBTI? I thought there was a proposal about 5 years ago that would have required funds to report UBTI, but the proposal was never adopted. Any thoughts? Thanks. Ed

Question:

Company has two plans: each passes 410(B) test on its own.

Must the company perform BRF testing between the plans (assuming the plans offer different BRFs)?

Thanks in advance!

The National Institute of Pension Administrators (NIPA) offers a great way to gain industry exposure: NIPA is seeking submissions (typically 800-1000 words) for its quarterly newsletter, PLAN HORIZONS.

Contact them at nipa@sba.com, with the subject line "For the Newsletter", for more details or with an article proposal.

Please confirm if the following is correct. My understanding is that catch-ups are based on calendar year, not plan year. Therefore, Plan whose plan year ends 5/31/2002, may permit an employee who attains age 50 during plan year ending 5/31/02 to make catch-up contribution for plan year ending 5/31/02. Plan, of course, will have to be amended to allow this provision.

Thanks.

I would like to know how differing interest rates affect the advantage of a Roth IRA. For example, if I have a Roth IRA that earns 1.89% APR and a savings account that earns 3.5% APR am I still going to save more in the Roth IRA? Doesn't it depend on how long I keep money in there? When do the tax savings "outdo" the interest savings?

Also, can I really take money out of a Roth IRA with no penalty?

Thanks for your help!

My accoutant says I made to much money to contribute to mime and my wifes roth ira's but he only has "gross income' figures.

I was trying to research "rothira.com" but couldn't find anything specific as to whether the the formula is based on "gross" or adjusted gross, agi" for the prupose of making contributions. I have large business loss that I feel will lower my personal income several thousand dollars so I need to find out what the cutoff is?

We have a cafeteria plan with reimbursement for medical expenses.

As usual, we obtained elections for all participants prior to 1/1/02 for the 2002 plan year. Elections were made based on our health coverage in 2001.

On 1/7/02 we were informed that there are increases to the deductibles, co-pay and co-insurance amounts for 2002, and several employees want to change their payroll deduction amounts.

The way I read the regs (including the new ones from 2001) we are out of luck as far as making this type of change.

Does anyone have another opinion?

Executives of Corporation A each have change in control agreements promising parachute payments equal to the lesser of an array of benefits or the maximum amount that may be paid without triggering the excise taxes under 280G. These amounts are payable if, for example, the covered executive is terminated without cause within 24 months afer the change in control occurs. A change in control occurs January 1, 2001 but the covered executives are not terminated. A second change in control occurs July 1, 2001 (the second acquirer is not related to the first acquirer or the first seller) immediately after which the covered executives are terminated without cause. Under the agreements, the executives are entitled to two parachute payments (sloppy drafting). But, are there two 280G calculations, effectively entitling the executives to two 280G limits?

My husband and I are both faculty members at a state university in Texas. We make a mandatory 6.65% contribution to the retirement plan, the ORP in our case (we opted out of the state's DB plan). Our mandatory contributions go into a 403(B) plan, to which the state also contributes. We've been told we can each defer the full $11,000 (plus the 50-and-over catchup) over and above the 6.65% we're already putting in. Is that right? I thought the total of all monies from my salary is limited by the $11,000 limit, plus catch-up.

Thanks to anyone who can shed some light on this for me.

I just read the article on "unconverting" a Roth IRA. Am I reading this correctly? Does it really say that stocks from a traditional IRA can be converted to a Roth and then if the stocks go up they can be held in the Roth and if they go down, they can be put back it the traditional IRA and no taxes paid for the conversion for the year 2002?

Is there an IRS form available with this data? This is a no lose project and I would like assurance that I an do it without being stuck at the end of the year with stocks worth less after paying tax on the higher value conversion amount.

Thanks for your help Paul pathroop@aol.com

A few months a go I transfered my assests from a 1998 Roth IRA conversion from a mutual fund company to my brokrage account with TD Waterhouse (I did this to aviod the fees Waterhouse charges) I did not realize at the time it was put into a non-retirement account. Thus it was treated as a withdraw from my Roth-IRA account and I will have to pay the penalities. I had no intentions on having this happen I feel TD waterhouse should of ask me if I wanted this transfer into an Roth IRA account (which I didn't have one with them). The fund company that I transfered from said they would have ask. Waterhouse is working on the problem so I still hope they can undo it some how. Does anybody have any ideas on this predicament I'm in Thank-you

I understand that Traditional IRA to ROTH IRA conversions have the five year holding rule. It's also been told to me that each conversion has a separate holding period based on when it is made. Need to confirm when this five year period begins. Is it calculated from the exact date that the money moves into the ROTH, such as five years from February 6th ?

Can someone point me in the right direction for the taxation of Travel Assistance benefits for employees and spouses? I don't have the full details yet but I am told the program primarily provides referrals so employees can find English speaking physicians whereever they may be traveling.

Thanks!

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According to the Tax Act of 2001, if adjusted gross income is below $30,000, 50% of contributions to an IRA or 401k is eligable for a tax credit up to $2,000. I am retired, but working part-time. My question: Does this include a Roth IRA? Also, can the $2,000 be a combination of Roth IRA and 401k?

My mother has been married to my father for over 30 years but hasn't seen him in over 25 years. As far as we know, he did get remarried without getting a divorce from my mother. She has a 401k with her former job and wants to roll it over or put it in an IRA. Does she still need his consent or is there some type of waiver she can get? Any inofo on this matter would be GREATLY appreciated.

As a general rule, IRS Form 5310-A must be filed at least 30 days prior to a plan merger. The filing requirement is waived for the merger of defined contribution plans that meets requirements specified in the 5310-A instructions. Does the waiver of the 5310-A filing requirement also mean that the merger could take place contemporaneously? For example, could an employer adopt merger resolutions on January 31, 2002 and make the merger effective the same day?

I realize that there are GUST/EGTRRA update issues for both plans, but, for now, just want to focus on this (potential) timing issue.

Thanks.

Does employer's health insurance plan qualify for section 125 when the only benefit for the employee is that his contribution(20%) is pre-tax? This is a H.M.O. which is negotiated with the employer through collective bargaining.

With the new daily valuation products available, it seems that a lot of services are using cash instead of the “normal” accrual method. The convenience of this is obvious. Is there any support by the DOL or IRS on taking this stance?

If I have an existing Roth IRA (say with mutual fund manager A as custodian), can I open a *second* Roth IRA with a different custodian?

In other words, if I have a Charles Schawb Roth IRA, can I open a Roth IRA with Fidelity also, as long as my total contributions to the two Roths don't exceed $3,000 each year?

Thanks.

Can a plan include all compensation paid to a participant, even compensation earned prior to the participant's participation date for purposes of determining the 15% deductible limit for 2001?