Looking at passed posts there is a consensus Terminated ROTH Ira losses can be taken, and it is in Pub 590, I cannot seem to find it, I emailed the irs and they stated"there is nothing in either pub 590 or pub 529 allowing a taxpayer to take

this as an itemized deduction. the only expenses associated with an ira would be investment

fees & expenses you paid for managing your investment that produced taxable income, or

ordinary & necessary trustee's administrative fees that are billed separately & paid by you

in connection with your ira. see pub 529, pages 9 & 10. "

If someone can point me to where it says you can take a loss on a terminated IRA I would appreciate it.. I think we will see some of them this year, and it does seem logical TNX Fred EA

5. If Alternate valuation is elected for an estate what date is used as the alternate valuation date for an IRA and a 401(k) each of which has a named beneficiary? (e.g., when is this property considered to be sold, exchanged or otherwise disposed of?).

I need clarification please on the rules related to hardship distributions from 457 plans. What are the requirements and where do I find them? I've read Reg. 1.457-2(h) where it talks about "unforseeable emergency". In particular, is a participant that receives a hardship distribution required to stop making deferrals for a 12 month period, as in a 401(k) plan?

I work for a county govenment that is not subject to ERISA. We do have a 125 plan in place and have a consultant telling me that we need to publish an SPD. I always thought this was an ERISA requirement and have never done one before. SO...whats the deal? Is an SPD required for 125 compliance or for ERISA compliance.:confused:

Our firm administers numerous small, trustee-directed, balance forward DC plans. We find that we spend WAY too much time holding hands with plan sponsors concerning the collection, deposit, and reporting of income taxes withheld from distributions from these plans. We are considering the idea of setting up our own "omnibus" tax account and EIN to collect, deposit and report distributions from all of these plans (under agreements with the sponsors.) This would be a great additional service to the sponsors and would probably SAVE us time.

I know many larger financial institutions handle distributions this way. Does anyone know what is involved in setting up the system? What do other TPA firms do to minimize distribution inefficiencies?

Thanks!

Quasi-governmental employer establishes "ineligible" deferred compensation plan under 457(f) for a limited number of executives and department heads. Plan assets are to be held in a rabbi trust. If it turns out that the participants are too numerous to satisfy "top-hat" criteria, is the plan now a 457(B) plan subject to trust requirements ?

And would plan assets be subject to tax for lack of an adequate trust?

Recently, some of the claims I submitted for reimbursement under my cafeteria plan were denied because of the date of service.

I was under the impression that the expenses became deductible when I paid them. The dates of service on these medical bills were December of 2000. However, I did not pay my portion due until 2001 therefore I turned them in to be reimbursed under the 2001 calendar year.

They were denied due to date of service being the prior year.

Is this right? My insurance company never gets around to processing these claims for several months after they are incurred, so I don't even know how much I'm going to owe as a balance due. So I had nothing to submit last December. This is telling me that if I wish to deduct an expense I incur in December, I must pay it in full and then wait for reimbursement of the portion that insurance paid? Because if I turn in the entire amount, that would be fraudulent, as far as I'm concerned.

Help?

Thanks much!

Jo

Question:

My company was purchased, they started the close of our eployer sponsered pension and retirement plan April 30th, 2001. The new company laid off about 6 employees, myself included. I was laid off August 1st. The job market is tuff, and I need my retirement and pension, or a portion of it, to survive until I am employed again. The management told me, that since the plan was in closure status, they do not have to pay out benefits. Everything I found out stated that they have to continue to administer the plan, including putting eligible participants into pay status. I also found out, and just need verification, that they were supposed to pay, or roll over by the 61st day of the end of the plan year, which I was told was when I was terminated, Aug 1st, 2001. They have exceded that 60 days. Am I correct here that they should have settled my pension and retirement plans by now? Thanks for any info anyone can provide...

Dan Weaver

One site I found that helps me with benfits is

www.iworkwell.com

they have a lot of good articles and guidelines in their HR 101 section.

I emailed them with a few questions and they sent me a code for a free trial. With it you can access the whole site.

gehrett

Is anyone aware of IRS guidance re: at what point a self-insured welfare plan is discriminatory when the contributions made by highly compensated employees are lower than those made by other plan beneficiaries? I'm looking for a formula for a mechanical (rather than conceptual) analysis. I.e., how is Reg. 1.105-1(e) actually implemented? All leads are appreciated

Assume plan sponsor has adopting employers of a 401(k) plan, but there isn't common control within the meaning of Section 1563. Each adopting employer utilized a different matching contribution rate. Is there any requirement that the matching contribution rates be disclosed to other adopting employers?

Is the result different if the plan is a multiple employer plan of totally unrelated employers?

Accumulated sick leave is paid after an employee terminates. Can sick leave be used as part of a 457 deferral even though the employee does not receive payment until no longer being an employee?

We are enrolled in a 125 plan that includes a premium conversion plan (POP) and FSA with a plan year of 1.1.0x - 12.31.0x. We are a county that has a self-funded insurance fund for all health, life and 125 contributions. Our plan administrators are considering raising the employee contribution (which is currently offered with the 125 plan on a pre-tax basis.) sometime within the next year, possibly before the new plan year and possibly after the new plan year begins to assist with the funding issues we are facing.

Would the difference of premium still qualify for the pre-tax deductions or would the difference be an after-tax deduction? Do the employees who have an increase in their contribution rate need to submit a salary redirection form authorizing the increase?

We are trying to determine if we can raise the 401(k) rate for our HCEs beginning in 2002.

Due to the increased compensation limit for next year, we fail the 125% ACP test because we have an after-tax feature in our plan. I was told that I can use the Alternate (+2%) Rule, but can't really find anything in plain English to explain. Everything I find dates back to 1990, and I know there were changes from the small business act a few years ago. If we can use it, we pass.

Can someone point me in the right direction, or give an easy to understand explanation of the various ways to perform ADP/ACP tests and the choices you have?

A public school district is setting up a 403(B) plan for administrators. The district will be providing a matching contribution which will vest over time. After 3 years, the district's contribution will be 60% vested. After 4 years, it will be 80% invested. After 5 years, it will be 100% vested. The District was told to set up two accounts for the 403(B) contributions. The administrator's contributions would go into one account and the District's contributions would go into the other account.

The District has asked whether it has to file the simplified ERISA 5500 form. I know that generally a public school district's plan would not be subject to ERISA because it would be considered a governmental plan. Does this situation change that general rule?

Does the provisions of the Soldiers' and Sailors' Civil Relief Act (Relief Act) apply to participant loans from qualified plans?

The Relief Act was enacted in 1940 and has been updated since then. Among its provisions is the requirement that there is a 6% interest cap on mortgages, credit card debt and "other loans" entered into before being called to active duty. In effect we are looking at the "military leave" period.

Some practioners have been concluding it does apply and others take the opposite approach.

Keep in mind that there was no mention of this, to the best of my recollection, during Desert Storm in 1991. In addition the services covered under The Relief Act are less inclusive than those covered under USERRA.

Do the QJSA requirements apply to a participant's Other Investments Account in a mppp ESOP? I realize that Code section 401(a)(11)© provides an exception to the QJSA requirements for the portion of the P's accrued benefit to which the requirements of sec. 409(h) apply, but it has alway been my understanding that this does not except the portion of a mppp ESOP that is not invested in employer securities. I am restating an ESOP for GUST using the Corbel doc., and Corbel insists that the QJSA rules do not apply to any portion of a mppp ESOP. I don't think that is true, but if it is, can I now eliminate the annuity option from the plan?

Can an employee have COBRA payments for medical insurance deducted from his/her paycheck on a pre-tax basis to pay for a former-dependent's COBRA premium? The daughter's qualifying COBRA event was college graduation and no longer qualifies as a dependent as defined in the medical SPD.

I believe the answer is no since the daughter no longer qualifies as a dependent as defined by the IRS, but I have a client that wants me to show them "where it states that."

Thanks!

I am aware that starting in 2002, rollover contributions from a governmental 457 plan may be rolled over into a qualified plan provided that the qualified plan separately account for the 457 rollover. I have three questions:

1) I assume that the reason for the "separate accounting" rule is because upon distribution of the 457 rollover from the qualified plan, the 457 rollover is exempt from the 10% early distribution tax under 72(t). Can someone please confirm?

2) Will the exemption from the 10% early distribution tax apply to the principal amount of the 457 rollover only, or to the earnings on the 457 rollover as well? In other words, if a participant rolls over $20,000 into a qualified plan in January 2002 and the money has appreciated to $30,000 when it is distributed in December 2002 upon the participant's termination, what amount is exempt from the 10% early distribution tax?

3) Do you expect a new Box 7 code on the Form 1099-R to identify distributions of 457 money?

Thanks for your help.

If an employee has taken a plan loan and then requests a hardship withdrawal, do they continue to make the loan payments?