My firm is contemplating adding to our program for our clients to offer special discounts on mortgage loans to their employees that people don't normally receive. The company can use this as an employee "perk", "benefit".

Is this something that companies would be interested in offering to their employees?

What would some of the critical points be that an HR Director would be looking for from the mortgage company in order to create this kind of partnership?

I don't want to come to the table unprepared. I appreciate any input. Thanks.

I have been asked whether it is lawful for a self-insured medical plan to charge different premiums to employees on the basis of their incomes: the higher the income, the higher their premiums. It seems to me that nothing prohibits this practice as it discriminates against the highly compensated employees. Any thoughts?

As I always undertood it the reason for excluding 125 Plan salary reductions under the definition of compensation for deductibility under 404 was that since 401(k) elective deferrals were employer contributions and therefore excluded from the definition of comp under the language of 404 and 1.404(a)-(9)(B)(2) and since amounts under a 125 salary reduction were kinda-like 401(k) deferrals they should also be excluded in the definition of comp. The only thing I ever found on this was PLR 9225038 Was there ever anything else?

Now, under EGTRRA it is clear that elective deferrals are not taken into account in determining the amount of contribution subject to the 15% limit, but I assume the rule relating to the definition of compensation remains the same--elective deferrals and salary reductions to a 125 plan are excluded from the definiition of compensation for 404? Is this correct?

Hi,

I wasn't sure where to post this, but thought this would be a good place to start as I see other agents/broker's posts regularly. I currently work at an agency and am building my book of business. I primarily do group health but also ancillaries (dental, life, disability). I came into the agency two years ago having spent the prior 18 with a major health carrier. The agency principal is nearing retirement and we have discussed me taking over the business. His book is also primarily group health with many of his clients my old clients when I was at the carrier. The current income breaks down approximately 55% group, 20% individual health, 15% P&C, and 10% life commissions.

I've done some research and most of what I see on the internet focuses more on buying p&c agencies or finacial planning practices. Does anybody have experience either buying or selling a practice where the bulk of the income is group health. One time fee / multiple of income? Percent of renewals? I'm open to any advice.

Thanks

While reading the thread about whether to withhold tax on a distribution in satisfaction of a tax levy, I received a demand from a U.S. Attorney that a plan distribute part of a participant's account to pay a judgment under the Mandatory Victims Resititution Act. There has been at least one (lower court) case that concluded ERISA plans are NOT exempt from MVRA liabilities. Like federal tax levies, MVRA judgments seem to be a liability to the federal government and, under the Federal Debt Collection Procedures Act and can be extracted from the ERISA Plan. However, Reg 1.401(a)-13 mentions federal judgments but really describes tax levies. Also, the exemption from the 10% penalty also seems to apply only to tax levies. Does anyone have any hands-on experience w/ MVRA judgments regarding enforceability and the 10% penalty??? Thanks

1.Is alternate value the same as

date of death value on jointly held property,

POD Accts, and IRA's with named individuals as beneficiaries?

2. which alternate value for 401(k) is used where estate is named beneficiary?

a.the same as date of death; or,

b.the value on the date account is transferred to estate, if within 6 months of death; or,

c.the value on date six months after death.

Question 7c on the new IRS Form 5300 asks if a plan is a "collectively bargained plan" and refers to Regulation section 1.410(B)-9. I don't see a definition of that term in the cited Regulation.

If a plan covers all employees (bargaining and non-bargaining), and certain provisions of the plan apply only to bargaining employees pursuant to a collective bargaining agreement, is the plan a "collectively bargained plan" for purposes of question 7c of Form 5300?

Employer A was a controlled group member with Employer B under Plan #1. Controlled group no longer exists and Employer A wants to establish their own plan and spin-off the assets attributable to Employer A and merge them into their new plan. Employer A workforce is aprox. 40% of A & B. Plan #1 will still exist for Employer B.

Do you think this would be a partial plan termination requiring 100% vesting in Plan #1 for Employer A's participants? Or given the fact they are merging their portion of Plan #1 into their new plan, and vesting can continue for them, they don't have to vest them 100%.

I have a plan that started 1/1/01. Do I still use 2000 compensation in determining HCEs, or since it's a new plan are they considered as not having look-back comp in the first plan year?

Plan Document excludes moving expenses and other fringe benefits from definition of compensation (satifies 414s). For the 2000 plan year, Employer includes those items in calculating the safe harbor match, but did not allow deferrals on those items. Thus, the Employer has made too much of a match for 6 ee's.

Plan also failed to follow eligibility in document and allowed all ee's in plan to defer.

Possible solutions include:

1. VCP (expensive?) to amend plan for 1 year to include fringe in comp and amend retroactively for eligibility.

2. forfeiting excess match and using to reduce future contributions and amend plan for eligibility under EPCRS.

Any comments on either of those solutions or any that I may have missed? I've looked at the notices, but nothing seems to address the compensation issue. The eligibility problem (by itself) is quite clear on the solution.

Thanks.

Ervin Barham

Hello,

Does anyone have a sample year end benefits compensation analysis they can send me?

Greatly appreciated,

Maria Markis, PHR

Ablest Inc.

I've been asked to find some information on how to implement an integrated SEP and I've found very little guidance. This is what I know so far...SEP experts, please feel free to comment:

1. An integrated SEP is a non-model SEP, meaning Form 5305 may not be used.

2. If all disclosure requirements are met (to participants), there are no reporting requirements to the IRS or DOL (meaning no 5500 need be filed; same as a model-sep).

3. There are two ways get started with an integrated SEP: draft an integrated SEP from scratch, or purchase a prototype from a financial services co.

Are these assumptions basically correct? Have you come across any good resources online that I could take a quick look at?

Here's another question:

Depending on whether you draft an integrated SEP, or purchase one from a bank, et al., would it be prudent to seek a Determination letter?

Thanks,

Maxwell

Can the minimum lump sum as calculated under 417(e) include pre retirement mortality?

For Example...

Assume Plan's AE is

7% Pre

7% Post

GATT Pre mortality

GATT Post mortality

And...

NRA is 65

Current Age is 50

1,000 a month benefit at NRA

5.32% applicable interest rate

Which of the following is the correct lump sum?

1000 * 134.83 GATT APR@65 * (1.0532)^(-15) = 61,964

or

1000 * 134.83 GATT APR@65 * 0.4223501 D65/D50 = 56,945

Association of employers (approximately 20) sponsor a fully insured health plan that is a MEWA. No individual sponsoring employer has 100 or more employees. Is the MEWA required to file a 5500?

Some beneficiaries of an IRA owner who passed away a couple years ago have been receiving the owner's RMD which was initiated before the owner's death.

Can the beneficiaries switch to the new distribution rules in calculating the RMD based on the new life expectancy talbe or must they follow the rules of the calculation prior to the recent law changes?

In another situation, an IRA owner passed away in May, 2000. The beneficiary's first MRD is due December, 2001. Can he apply the new MRD rules for that first distribution?

Can a terminated participant from an ERISA 403(B) plan rollover his distribution to a non-ERISA 403(B) plan?

Must a provision allowing for 100% vesting upon disability be retained in a plan restatement for all participants in the plan as of the restatement date? Or only those participants who have 3 years of service at time of restatement and who elect to retain the old vesting schedule?

Presume the following: Paired MPP Plan and PSP provide for 100% vesting upon disability.

MPP plan is merged into PSP, and PSP restated, effective January 1, 2000. Disabiliity vesting provision is NOT carried over to restated PSP.

Participant with fewer than 3 years of service at time of merger and restatement is injured in 1999 and injury results in disabiility during 2000, after effective date of restatement eliminating 100% vesting upon disability.

Participant terminates in 2000 and demands 100% vesting due to disability.

Any comments appreciated.

several questions please: effective for plan years beginning in 2002, is it ok to have a ps at 25% and also a mp at 25% as long as the increased limit of the lesser of 100% of comp or $40k is not exceeded? next: I have been trying to find what the penalty is if a plan does not carry an ERISA Surety Bond. An attorney is telling me despite it being a requirement there is no penalty if the plan sponsor does not have one. next: I have read 2001-77 several times and am trying to clarify if a cross-tested psp (Corbel volume submitter document) has automatic reliance. Safe harbor comp definition being used, along with 1000 hours and last day provision. OK not to submit because of "partial" reliance? HELP please. Thanks so much.

My review of the new proposed regulations leads me to believe that a spousal rollover can be made at any time after the death of the IRA owner as long as the minimum distribution has been made to the IRA owner. So that seems to mean that a surviving spouse could take required minimum distributions from the IRA for 20 years and then roll over the IRA if the surviving spouse so elected.

Furthermore, there does not seem to be any rule that would prevent a surviving spouse from taking a partial distribution from the IRA as a beneficiary and then doing a spousal rollover of the remaining account. This is significant where the spouse wishes to take a distribution of some of the account and is under age 59 1/2.

Does anyone disagree with my analysis? Noel, I would love to hear your opinion.

Kurt

After reading the age 50 catch-up proposed regulations, what questions have you come up with?

Here's one I have:

Say a participant has $500 returned as excess deferrals [402(g) excess] for 2001. The participant defers $10,600 from 1/1/02 to 11/30/02 in a plan that allows age 50 catch-up. The ADP limit for the plan year 12/1/01 - 11/30/02 turns out to limit HCEs to $10,000.

Under 1.401(k)-1(f)(5)(i), only $100 would need to be distributed to the participant as a corrective distribution.

Does the participant have $600 in catch-up contributions, or $100 in catch-up contributions, as of 11/30/02?