It's my understanding that if one plan is properly merged into another before the remedial amendment period expires, only the surviving plan has to be restated,provided that the appropriate language is contained in the restatement. Where can I confirm this? What is the appropriate language?

Can the IRS go back an unlimited number of years to force RMDs? If there is a limit, how many years can they go back?

I've heard that the proposed regs. stating that 5% ownership status never went away, even after divesting oneself of any ownership interest -- were repealed. Therefore, you would only be considered a 5% owner for the next 5 years. Can anyone varify that?

An employer would like to do away with their health insurance and instead put money into the employees' medical spending account so they may purchase their own health insurance. The employees would then be reimbursed for the premiums from the medical reimbursement part of the cafeteria plan. The question the employer has is can an employees' unused employer money be carried over to the next plan year? I know employee money is always "use it or lose it" but what about employer money?

Can a group health plan require participation in a wellness program or a wellness assessment as a condition to participation in the plan?

My company is composing a letter for our shareholders who attained age 70 1/2 this year and are required to begin taking their RMDs by 4/1/02. Someone sneaked the following Q & A in and I am not sure it is entrely correct:

Has the timeframe changed for when I need to begin taking RMDs?

The new proposed regulations have not changed the timeframe. If you have an IRA or participate in a Qualified Retirement Plan, you must start taking distributions no later than your required beginning date, and continue to take distributions over a period that does not extend beyond either (1) your life expectancy or (2) your life expectancy and that of your designated beneficiary.

After reading UPI's materials (I was not the one to attend the recent conference this month), I understand that the old rules still apply for beneficiaries inheriting an IRA before RBD, correct?

What about AFTER RBD? Can't the benficiaries in turn stretch out the IRA to THEIR beneificiaries? Does that make the point in the Q & A above incorrect?

Please help!

Can you tell me if your company pays for your employees' continuing education and exams and what kind of rewards you offer for successful completion? Bonuses, raises, etc.

The proposed regulations on catch-up contributions released this week do not require that a participant have made elective deferrals in excess of an otherwise applicable limit in order to be a catch-up eligible participant. They give an example where a participant is allowed to make elective deferrals in an amount PROJECTED to exceed the otherwise applicable limit.

There is also a "universal availability" requirement where participants must be given the same "effective opportunity" to make catch-up contributions. An example is given where the plan provides participants with an opportunity to make catch-up contributions on a payroll-to-payroll basis.

Additionally, there is a provision stating that the amount of the elective deferrals in excess of an applicable limit is generally determined as of the end of a plan year.

Do all of these provisions, read together, allow an employer to make catch up contributions at the participant's election without having to determine if they are currently exceeding a limit, and without having to project if they will exceed the limit, so long as at year end the catch-up contributions that do not exceed an applicable limit are included in the ADP test?

There is no guidance in terms of having to obtain a specific catch-up election by the participant. If a participant elects 20% of comepensation, can the employer automatically contribute an extra $1,000 as a catch-up once the employee hits the 402(g) limit??

My 84 year old father passed away in May of 2001, leaving me and my brother the beneficiaries. My father had not completed his RMD for this year---the year of his death. I have been informed that his RMD MUST be completed before the IRA's are split between me and my brother.

My question is: will the required minumum distribution be reported as income (distribution) on a 1099-R to me and my brother or will it be reported as a distribution to my father?

Julie

If the IRS is reviewing a 5310 and the plan administrator has discovered an operational defect after the filing but before a determination has been made by the IRS, is there any advantage or disadvantage to informing the IRS of the failure when it could most likely be corrected through SCP?

Would there be a benefit to waiting until a determination letter is received?

I am reviewing a draft QDRO for a conventional DB pension plan. The date of divorce is after the participant's date of hire, but prior to the participant's date of participation. Upon participation, the participant gets a full year of credited service back to January 1 (which precedes the date of divorce). Got the picture?

Specifically, it awards X% of the participant's accrued benefit "as of date of divorce" to alternate payee. Does this have any force? Could it (assuming all other provisions OK) be a valid QDRO but with an award of zero dollars? Could it be construed to award part of the benefit which has not yet been earned as of date of divorce? What responsibility does the plan sponsor have to point out these issues?

(Sorry, that is kind of open ended.)

Can vacation days be "sold" in a 125 plan and then used to fund childcare (129)?

We're considering implementing one of the safe-harbors. We have a union environment. What experiences have you had using one of the safe harbors? Any plusses or minuses you can share with us? What landmines should we look out for?

I'm 25 and am interested in opening a Roth IRA. How does one go about opening one? Is it necessary to shop around for rates? How is a Roth different from a 401(k) (which I don't qualify for currently)?

Also, I'm unclear as to how a Roth can be tax-free unless compensations come out of one's pay check before taxes are withheld.

Just to confirm, it is NOT an acceptable shortcut around COBRA regulations re: deriving premiums for a self-insured plan, for the plan to get a COBRA premium quote from an insurer applicable to plans of comparable size/claims experience?

I have a client whose ins. broker is insisting that this is a widely-accepted methodology.

Regarding Cafeteria Plans and COBRA:

We have someone who has been participating in our Flex. Health acct. through COBRA beginning in Sept. She sent payment for Sept., but has not paid for October. Yesterday I received a reimbursement request for a service rendered 9/28/01. Does date of service still matter if the person is partcipating through COBRA? Basically, my question is, even though she hasn't paid for October, do I still need to reimburse her for a service rendered in Sept.? Some regulations I read made me think I do NOT have to--because by not paying for October, she is effectively no longer participating in the plan. Does anyone know for sure?

Can a person make a donation to a charitable organization, more specifically a church, by transfering money from their 401k plan without being charged penalties or taxed?

Is anyone aware of any law that will require Social Security Numbers to be removed from benefit statements in the future?

Going to ASPA next week.

Anybody else?

Our 'fearless leader' Dave Baker is giving a talk Wednesday!

I have a water/mutual irrigation (gov't) company that is moving ahead with establishing a new 401(k) plan under the new 501©(12) rules, but now they want to know whether then can combine the plan with their existing 401(a) Thrift Plan. The Thrift plan is a money purchase pension plan set up to provide for 10% contribution after mandatory 4% employee contribution. This scares me, because generally MPPPs aren't allowed to have CODAs; however, can this CODA be included with the MPPP in this case because it is a "rural cooperative plan" under the new 501©(12) rules? HELP!!!!