Does anyone know the latest guidance, formal or informal, on SAR requirements for (former) participants who have received their distributions? Assume we have a defined contribution plan.

1. We terminate the plan and make all distributions in 2001 plan year. By the end of the plan year there is no one and no money left in the plan. Do we provide a 2001 SAR to anyone and if so, to whom?

2. We terminate the plan in 2001 but don't complete our distributions in 2001. By the end of the 2002 plan year there is no one left in the plan but we have $100,000 in forfeitures which we use in 2003 for plan expenses. Ignore the question of whether the plan actually terminated because we didn't make distributions within 12 months after the proposed termination date. We file the 2001, 2002, and final 2003 5500, all timely.

For 2001, can we limit the SAR to those persons who had account balances on the last day of the plan year, do we have to send it to everyone who had an account balance at any time during the year, or something else?

For 2002, do we send anyone a SAR and if so, to whom? What about 2003?

Does anyone know what code section the in-service withdrawal for participants aged 59 1/2 rules can be found?

How much historical recordkeeping information should a company keep for participant distribution. I have a participant that would like to know the exact date of his distribution. Since then we have a new recordkeeper and the data is not available?

I was able to give him a copy of his statement but it did not provide the correct information.

Our payroll processing company, The Business Office, has been asked by a number of clients who want to install a program referred to as the Health Incentive Plan or HI Plan.

We are aware of the warnings put out by many benefits and tax experts against using the version of the HI Plan that is marketed by the Redwood Group (TRG) and are lead to believe that the IRS and state Depts. of Insurance will be taking action against that plan.

However, these clients want to use the HI Plan from Burns & Assoc. and not the TRG version and further indicated the Burns plan is the original HI Plan and has a patent pending.

Has anyone had any feedback or opinions from legal advisors on the Burns HI Plan? Our clients have favorable opinions from their legal advisors and we have not been able to get any negative responses from the sate DOI that we contacted nor the IRS.

I am well familiar with the GUST restatement deadlines for qualified plans, but less clear re what the deadline is for 403(B) plans. Can someone please straighten me out? Thanks

What happens if a hospital service district loses its 501©(3) status due to taxing authority? Do they simply stop making contributions to their 403(B) plan and replace it with another type of plan?

An employer has opted out of Social Security and is currently providing the required retirement benefits through a thrift plan. Is there any reason why a 457(B) plan would not satisfy the requirements of Section 3121. 3121 says it must be a defined contribution retirement system and that employee contributions can be used to satisfy the requirement.

An employer has opted out of Social Security and is currently providing the required retirement benefits through a thrift plan. Is there any reason why a 457(B) plan would not satisfy the requirements of Section 3121. 3121 says it must be a defined contribution retirement system and that employee contributions can be used to satisfy the requirement.

We have a client that is in serious financial difficulties & is looking to crash their SIMPLE-IRA. A few questions: Can an employer terminate a SIMPLE plan prior to year-end? Are there any notification requirements to the employees? Also what are the ramifications if the employer does not make their 2001 matching contribution?

Does anyone know the definition of a drug or biological under 213? Also, where is it defined?

Today's (10/23/01) Federal Register contains proposed regulations regarding catch-up contributions for individuals over age 50. Here's a link:

http://frwebgate.access.gpo.gov/cgi-bin/ge...26566-filed.pdf

Long time reader, first time poster. This is a great site. I believe I know the answer to my own question, just wanted to run it by people who see this stuff more than me. I have a client that had a calender year SEP up until August 2001, then ixnaed that and adopted a 401k profit sharing plan. SEP had not been funded for 2001. Client wants to make a contribution to that terminated SEP, mostly because the employees who are now in the 401k plan were not in the SEP due to eligibility requirements (the owners of this S corp want everything going to them)...

Anyhoos, although the deadline for making a deductible contribution for a SEP extends to the due date of the tax return (so conceivably you could have until September 15, 2002), I believe it's implicit that a SEP actually exist at the time that contribution is made. I would recommend that they "really quick adopt and terminate" the SEP so they could do the contribution, but one of the basic req's is no other qualified plan can exist (as now they have a 401k plan).

Anybody disagree with me? Any thoughts appreciated. By the way, you guys really are sicko's for choosing this profession.

Have a client that provides research and analysis to a Public Mutual Fund. Client get's paid on a contract basis.

Can anyone see a reason why the client shouldn't or wouldn't be able to offer the fund as an investment option in the 401(k)?

Only issue I can think of goes toward insider trading, however the client does not have any influence over the way the research is used, or what is derived on the Fund Family side - so I think that would be a mute point.

Any other thoughts?

Thanks

A closely held corporation wants to repurchase company stock from its formerly-leveraged ESOP.

However it wants to use a "note" from the Company to the plan to do this!

Seeking confirmation that (a) this would be a prohibited transaction; (B) it is likely to be a fiduciary breach (imprudent investment), independent of PT rules; © this would render the ESOP a non-ESOP; and (d) the correct approach would be to terminate the ESOP and distribute cash or stock, as the case may be, to participants, after obtaining a valuation of the company by an independent appraiser, as of the date the employer purchases company stock.

Can you tell me where in the IRS regs, Treasury regs or otherwise, I could get the guidelines for establishing benefit classes under a 125 single employer plan. For example, it is common that employers pay a higher percentage of premiums for their management class than for their hourly class. What other classes can be made? Is there a restriction on the number of classes a plan may have? Can you create different classes based on years or months of service to the company?

Also, under the same 125 single employer plan, can I offer some, but not all, benefits of the plan to different employee classes? For example could I offer detal to the managers and not the line level?

I am SO far from an expert, as you can see, so speak slowly and use small words so that my little brain can understand. Thank you!

Withing 30 days of marriage, I understand my wife can alter her contributions to her flexible spending account.

Previously, it had been zero. If she now contributes, can that money count towards her own medical expenses incurred prior to the actual date of marriage?

Is Fidelity Bond coverage required for VEBA plans? From what I've been able to determine, coverage is not required but may be obtained.?.? Any advice out there?

Just a quick survey,

When looking at an "ongoing funding ratio", are you typically using the actuarial value or the market value of assets?

"Ongoing funding ratio"- is a term we use to describe a comparison of the present value of the plan's total expected liabilities (PVB + PV of future expense) to the present value of the assets (AV or MV of assets + PV of Future expected contributions). It is a calculation that is typically done for multiemployer plans to make sure that the expected contribution rates are in balance with the expected benefit accruals.

It seemed to me that since this is a projection type calculation, based on the various actuarial assumptions and future events, that the Actuarial value should be used, but I have seen other actuaries using Market Value.

I'm not suggesting either is "wrong", I'm just interested in other opinions.