I am in the process of amending a davis bacon plan for gust. does anyone know if the dol(especially the nysdol) is still requiring an individual IRS letter of determination on these plans? any comments are appreciated.

does anyone know if the dol is still requiring that prevailing wage plans receive an individual letter of determination? I have been asked to update a davis bacon plan for GUST and wondered if anyone has any up to date info on irs plan filings for these types of plans?

Company X has several thousand employees. X Holdings is a holding company which has publicly traded stock. Company X sponsors an ESOP with X Holdings stock. If dividends are declared on X Holdings' stock and distributed in cash to participants or, at the participant's election, are either distributed in cash or reinvested in the stock, who gets the tax deduction, X Holdings or Company X?

Code Section 404(k) provides that the deduction is available to the corporation paying the dividends. Since X Holdings has no employees, does X Holdings merely make a capital contribution to Company X and loses the deduction?

My understanding has always been that the only expenses paid by the plan (as opposed to the employer) be reported on the Schedule C. The thinking being that the C allows the DOL to monitor the fiduciaries of the plan. Therefore, in filing a 5500 for a self-insured medical plan whose funding vehicle is through general assest, no Schedule C is required to report third party administrator fees. Is this correct or do these TPA fees need to be reported on the Schedule C?

I have seen a few custom government pension plan documents that has included a few ERISA sections. For the most part, they include mainly the correct government sections. If a government plan documents includes a few sections from ERISA does the plan sponsor then need to comply with ERISA totally? If not, can the plan sponsor add certain ERISA sections and still maintain that they are a government plan plan and only venture outside for those other sections selected? Example, one of the ERISA provisions included in the plan is the QDRO language, with reference to the IRC. Assuming that there is no state requirement to follow the QDRO regulations, can they do this without following being required to follow ERISA totally?

Could anyone provide me with input regarding how to handle annual employee benefit statements which include a medical plan which is self insured?

I would think that we should use the actuarial fully insured equivalent rate (which is also our COBRA rate) to represent the amount paid by the company. However, how do we explain this to employees?

Any input is appreciated.

Just received the p.s. 58 cost info from an insurance carrier. In addition to the "cost of one year term" they provide "waiver of premium" and "accidential death benefit" amounts. I read somewhere that the 1099-R p.s. 58 amount reported in block 2a is the total of these 3 amounts, but have not been able to find the reference. I think the rationale for including the waiver of prem and AD benefit $$, was these items are "extras," not pure insurance Can anyone help me? Thanks. Maverick

We are a construction management company and are thinking of contracting a superintendent for one of our projects. This superintendent is requesting we cover his worker's compensation. We do not feel we should be allowing/offering this - is this the case? What are the exceptions?

In looking over IRS form 8606 which reports traditional IRA to Roth conversions, I become confused by Part II lines 16 -18.

I am converting my traditionals to a Roth as a result of the large decrease in value they experienced in the latest market downturn. As it works out, my conversion amount (line 16)will be substantially less than my basis (line 17) leaving me with a negative total on line 18 - the taxable amount. Line 18 is then reported on line 15b on the 1040 and will show a negative IRA distribution.

Could this be correct? If it is, I will not owe any taxes on the conversion. It is a significant point that should be brought to the attention of others who find themselves in a similar situation.

Example: Line 16 Amount converted $10,000 (current value)

17 Basis 20,000 (contributions/

rollovers)

18 Taxable Amt. (10,000)

(subtact 17 from 16))

What have I missed? Thanks for the help.

We're testing a cross tested plan using the accrued to date method. The test fails on this and other (e.g. annual method) bases.

The plan requires 1000 hours and employment on the last day to receive a contribution. There's a participant who would have an high EBAR and help the test (because of the accrued to date method), but he didn't receive a contribution because he terminated with under 501 hours, so he's statutorily excludable.

Can we include such people (in the test)? What are the rules for including (in the test) statutorily excludable people who are in fact excluded? If we brought him in, does this mean we have to bring in people who didn't meet the plan's age and service requirements as 0%s?

I'm suffering from brain cramp today, and my brains have turned to sand and are running out my ear every time I tilt my head.

Is the Gateway minimum calculated on the cross tested plan alone or does it include the 401(k) contributions?

Example: Highly Compensated employees receive 20% of pay between both plans, but only receive 9% in the cross tested. Is the Gateway minimum 5% or 3%? I think that under 410(B) these are not aggregated, and it is the 3%. Would appreciate any opinions! Thanks.

A client is interested in providing QSERP benefits for former HCEs covered under a nonqualified SERP. There is not too much guidance in the regs regarding coverage and nondiscrimination testing for former employees. It states that many of the tests applicable to actives will apply to former employees. I'm assuming that for the general test, annual accrual rates can be determined by taking accrued or pensions in pay and dividing by credited service and then proceding as usual. Any thoughts or suggestions?

If a Plan Sponsor has an existing SIMPLE IRA Plan in which a contribution was made in 2002, however would now like to discontinue the SIMPLE IRA Plan and begin a Safe Harbor 401(k) Plan - can this be done? And if so, what are the limitations in regards to contributions? Does the Plan Sponsor just need to make sure contributions don't exceed the $11,000 level or is it more complex than that? Thanks.

Is it necessary to prepare an SAR for a 403(B)(1) plan? We have prepared the Form 5500 and need to know if ee's need to receive an SAR. Thx!

I've been responding to the IRS on several individually designed plans and I have gotten a couple of requests to modify the language I use for HCE definition to "affirmatively" elect use of the top-paid group. I have been using language similar to Pamela Perdue's in her volume submitter plan in her treatise, and am not sure what the IRS wants as an affirmative election--do I need to state that the employer affirmatively elects to limit the HCEs to the top paid group? Has anyone else run into this on individually designed (as opposed to prototype with adoption agreement) plans?

Based on the existing plan contribution information, it seems that this plan would be better off to amend the document to add the 3% Employer Non-Elective Safe Harbor Contributions to NHCE's and eliminate the existing match provision of 50% of the percentage deferred up to 10% of compensation(maximum def.%). If plan is amended, should the amendment be effective 3/1/2002 (2/28/ PYE)???????

Also, to maximize the contributions for HCE's amend the maximum deferral percentage from 10% to 15% or 20%..... The 3% Non-Elective Contribution would satisfy the Non-Discrimation Test and the 3% Top Heavy Minimum Contribution.

Please help me on this one............... Also, if anyone has a sample notice to participants regarding the addition of the safe harbor contribution methods if electing the matching or 3% non-elective method.. My email address is rvidovich@nebsonline.com.

Employer health plan currently covers a minor who lives with the employee even if not the employee's child. Employer is amending the health plan to eliminate dependent coverage in this situation. Is the Employer required to offer COBRA to the minors who will lose coverage due to this amendment? Thanks for any input.

rules on what the ssame company that has annunity contract can charge to the annunity 403b from their administered Long-term disability contract.

A friend has a QDRO for her ex-husband's DB plan that says she can start taking distributions when the ex starts taking distributions. (I'm not sure who drafted that). The ex doesn't want to take any distributions just to spite her, even though he's retired. The ex is 65 and she is only 60. Is there a way to amend a QDRO so that she can start taking distributions before her ex starts taking them?

I plan to open a roth IRA stock account under both my wife and I. It is much easier to manage only one account.

Is this allowed? Could we put in totally $6000 for year 2002? What is the difference if each of us open a roth IRA account?

Thanks.