Concerned about the accruals and funding requirements under the MPP.

Employer with a Standardized MPP wants to amend to a 401(k) effective 1-1-02. The MPP plan year is 5-1 to 4-30. The MPP calls for an ER contribution of 5% of plan year compensation.

It seems the employer could amend the MPP plan to change the plan year so that it ends 12-31-01 and fund the MPP contributions to that date and then continue as a 401(k) with the new 1-1 plan year.

But the employer would like to keep the 401(k) plan year as 5-1 (coindcide with FY). Could they amend the MPP with a rate of 0% as of 1-1-02 and change to the 401(k) as of that date?

The employer could establish a 401(k)effective 1-1-02 with a 5-1 plan year and amend the MPP effective 12-31-01 changing the plan year to 1-1 and with a 0% going forward and then merge the MPP

into the 401(k), but they would prefer not to. But is this the best way to do it?

Suggestions?

Couple of questions concerning 401k loans and terminated employees.

1. Can a plan administrator allow a former employee to continue paying on his/her loan after termination?

2. If the answer to question 1 is no, is there an amount of time the employer must give the terminated employee to pay the loan back? Is the Plan administrator required to notify the terminated employee that the loan is going to be "deamed' a distribution?

Thannks.

my company match my contributions to the 401k with company stock from an ESOP loan. the loan is now paid off and future company matches will be in the form of company stock, but purchase in the market on an as needed basis.

am i still restricted to the diversification requirements of the esop (age 55, 5 years, etc.)? there are no plans for a new loan.

Recently, a lot of information has circulated on USERRA's effect on retirement and welfare benefits. I have not seen anything that addresses the flex health care and dependent care accounts. Any comments, suggested readings?

Does anyone have any authority on placing a traditionaluniversal life contract into a 412i plan or must it be a whole life contrafct.

I have a default loan question I would like to tap some expertise on.

We have a participant who defaulted on a loan. The amount of the loan when it went into default was $20,158 back in 9/1999, The guy wants another loan. The current running interest loan balance is now $25,740.

When taking into considering the amount of his vested balance which would you take for coming up with his vested balance:

1?) 20,158 + his current vested balance of 30,444 or

2?) 25,740 + his current vested balance of 30,444

then we would take 50% of either option 1 or 2 above less the outstanding loan balance

We are busting our brains in trying to interpret loan language we rarely use.

Any actuaries out there already planning a greater use of smoothing methods in light of the recent market activity?

If the 401(k) Plan is frozen can you still pay out participants upon termination and if so do you make them 100% vested since the plan was frozen?

Facts:

Client has w-2 income and is a statutory employee covered under a pension plan for company X.

Client also receives 1099 income from other source.

Can he establish a sep for the 1099 income?

I am auditing a MPP Plan that is part of a Master Trust with a 401(k) Plan. How do I report the investments for the MPP Plan on the Schedule of Assets Held for Investment and the Schedule of Reportable transactions . Do I show the entire activity for the Master Trust or do I somehow pro rata just for the MPP Plan?

Does anyone have an opinion as to whether or not sponsors should be submitting prototype plans for determination letters in light of IRS Announcement 2001-77. Typically we deal with clients that sponsor either garden variety non-standardized 401(k) and/or profit sharing plans as well as some cross tested plans which we will be restating under the volume submitter program.

As 2001-77 gives extended reliance that the plan satsfies the form requirements, is there any meaningful reason to submit these days?

We are a family of four. Two adults and two children (minors). I (Arther) work - currently under the income bracket of 28%. I plan to retire in about three years from now probably under the same income bracket (might move out of USA). Have a question on whether to go in for Trad IRA or Roth IRA this year (2001) onwards. I already have a Roth for the yrs 1999 & 2000. Very interested to hear from you.

IRA holder requests transfer of IRA funds from one investment broker to another. The transfer was intended to be a trustee-to-trustee transfer but was instead was miscoded as a taxable transfer.

The IRA holder never received a check or at any time had possession of the funds, however he received a Form 1099 from the investment broker that originally held and transferred the funds. What is the best way, if any, to disclose this error so as not to be required to include the 1099 amount in taxable income for the relevant year?

Does anyone know if 403(B) custodial agreements or plan docements need to be updated by the end of the GUST RAP ?

Will Governmental 457 plans need to be updated the end of the GUST RAP?

Will they need to file for determination letters and does state law play a role in determining if they need a determlnation letter?

My organization's Cobra rates are far below the actual cost of insurance. With a new health plan and rates going into effect soon, we would like to raise the Cobra rates to where they should be, but it is such a significant jump, most people (including long term employees who are now retirees) will not be able to afford it. We thought we could perhaps inform them what the costs will be, but raise them in 2 to 3 increments over a 6 month period. All legal regs I can find say "in general" you can raise rates once prior to a 12 month period. But, if we inform people what the final rates will be, and raise them incrementally to that point, is that acceptable? Thank you.

I will be emigrating to Australia in the next ten years, and can't find out if I can withdraw funds from my Roth Ira penalty free to purchase a first home, considering that the first home will be overseas. Any ideas or comments would be much appreciated!

we have an employer who has not timely deposited his participant contributions for the 2000 plan year. we are trying to calculate the excise tax owed on multiple payrolls that were not timely deposited. for the 'amount involved' is it the interest that would've been earned on the contribution from the 15th business day after the end of the month to the day it was actually deposited? and how do you determine what interest rate is acceptable? will it change for each payroll? is there an "IRS acceptable" interest rate that can be used if the actual interest rate is indeterminable?:confused:

COBRA just notified me today that I am uninsured - the business, which provided my group plan, went 'out of business' at the end of LAST month. COBRA is refunding my premium for the month, but understandably, I would rather have the insurance as I have been deemed "uninsurable" b/c I have a progressive, degenerative illness which is treated with very expensive drugs - hence, the option to take the COBRA and not be insured privately.

I was 9 months into what I thought was to be 18 months of coverage...and as a freelancer, have not worked at a company that offers insurance benefits since leaving my previous employer. (I work in the entertainment business in California)

What options do I have - aside from paying cash for all treatment this month- and is there any kind of notification procedure to former employees that the company that went out of business should have followed? I feel like I have been punched in the stomach. Any input is welcome.

As requested by an IRS auditor, I need to prepare 1988 - 1991 Forms 5500EZ for client. Anyone know where I can get copies of these old forms? (IRS website PDF files only go back to 1992.)