I have recieved a letter from a 3rd party administrator saying thier company pays on a daily basis. They require no reciepts on Medical or Daycare. They say FSA's under 125 need no reciepts they just take your word and tell you to keep the reciept in case of an audit. What law does this fall under & how are we to compete with these people.

This is a subject about which I know nothing. What's the deal on amending, for example, IRA annuity contracts, which specify a maximum non-rollover contribution of 2000 dollars. Does the IRS provide "snap-on" amendments similar to what they released for qualified plans? What deadlines apply, if any, if such contract language changes are required? I suppose this would apply to 403(B), maybe 457 as well? Thanks.

Does anyone have any experience writing (health) plan documents for PEO's? Any advice regarding regulatory issues or special plan wording for these entities would be a help.

An existing 401(k) plan has two types of contributions, deferrals and matching contributions. The plan has a number of participant directed investment options, including company stock of a large publicly traded corporation.

The goal is to obtain dividend deductions paid on qualified employer securities.

Assuming there are no plan design changes (i.e., investment in company stock is at the election of the participant for both deferrals and matching contributions, and participant can exchange freely between investment options):

(1) how would you perform ADP/ACP testing? (2) Would you have two ADP tests and two ACP tests? (3) Would the deduction of dividends be accomplished through a KSOP or a stock bonus plan design? (4) How do you apply the "primarily invested in employer securities" rule, assuming it's relevant??

Any help would be greatly appreciated. Thank you!!

As of 1/1/02 a top-heavy 401(k) plan allows immediate entry for deferrals,but requires 1 year to be eligible for the tiered profit-sharing allocation. The immediate entrants get the 3% t/h minimum. Must they also be "topped up" to 5% (or 1/3 of the highest HCE allocation rate)? Or does the mandatory disaggregation of the (k) and (m) portions govern and only those eligible for the ps allocation are subject to the gateway?

Just a refresher. If you have a 401(k) safe harbor plan with 1 year(1000 hrs) and 21 for eligibility and later decide to amend for immediate eligibility to defer and keep the 1 year for safe harbor and the plan is top heavy. The result would be to still give the safe harbor to those that satisfy the 1 year eligibility, but also give the immediates a top heavy min. contribution?

Any suggestions

If a check for a contribution to an IRA bounces- what happens to the earnings that accrued on the amount while it was in the IRA?

A MPP plan wants to change their plan year end from 10/21 to 10/31. From what I've read under Section 412, the minimum funding is required for all years. They do not want to make a contribution for the 10-day short year. Any input/experience with this is appreciated.

I have receive numerous answers to how question 4i of the schedule I should be answered. The question: Did the plan at any time hold 20% or more of its assets in any single security, debt, mortgage, parcel of real estate or partnership/joint venture interest?

Seems like this should be a faily easy question, but we have experienced much debate over the correct interpretation on how to answer this question. The Form 5500 instruction book provides little help. The question is: Should Mutual Funds be reported here if the value of any of the funds is 20% or more of the beginning value of total plan assets? My thought and prior instruction have been, No. Only truly, single securities - stocks and bonds for instance. A mutual fund not being defined as a single security, and therefore would have no bearing on this question. Thoughts?

I didn't see this one listed as known problems, but was told it was a bug, so be aware.

If you reverse a transaction (e.g. contribution) in which the allocation was to a particular division, and that division has a space in it, then the system will reset the transaction to ALL.

you have to re enter the division name before reposting.

this is supposed to be fixed with the next service pack.

For large plans early retirement subsidies can be "funded for" utilizing retirement decrements, and for small groups the impact of someone taking the subsidy can get factored into the gain/loss for the year - my question is if you have all inactive terminated vested lives, is there any reason you wouldn't assume everyone takes early retirement when eligible ?

I need to request a private ruling regarding recharacterizing a Roth IRA for 1998. I have been unable to find information regarding the IRS requirements for requesting such a ruling or the address for submitting the request. Any suggestions. Thank you very much

I have a potential client who has numerous former employees with small balances in the 401(k) plan. Generally, the average balance is under $100. Attempts to contact these participants have meet with some success. What is left are the really "lost" participants. How much effort and expense is the company expected to expend to locate these people for the small amounts involved? The balances are costing the company considerable administration expenses. Is it possible to:

1) Forfeit the balances and handle the forfeitures as provided for in the document? If a participant reappears the company would simplely cut him or her a check for the forfeited balance plus earnings. What are the risks of this method?

2) Some consultants have suggested a 100% withholding. I never heard of this. Has anyone used it?

3) Any other ideas?

Thanks.

It is my understanding that Canadian DCPs only allow for very limited deferrals for a temporary period (i.e. can only defer bonus and can only leave funds in the plan for 3 years or so). Has anyone successfully been able to design a more feature-rich DCP for Canadian employers?

Is it legally necessary to have a Plan Document in place for NQDCP Plans?

There seems to be a group of organizations marketing plans euphemistically purporting to be VEBA's, yet leaving the funding in the hands of the Employer. Seems to be happening in the public agency and school world more than elsewhere. I would appreciate any comments about the differences between VEBA's and "Section 115" plans. It appears to me the employers are saying "trust us, we won't spend your money" and further that the possibility of constructive receipt or a "bad" 457(f) scenario looms large. Most labor groups don't seem to be aware of the difference betweens these "look alikes" and a real 501(c ) 9.

Can a plan sponsor elect to increase their plan's compensation limit for testing purposes only? In effect, contributions would be based on $170,000.

What legal requirements are there regarding the confidentiality of the benefits payable under a qualified retirement plan?

I cannot find anything in the plan document.

I am the Benefits Specialist in the HR Dept in a corporation. A manager wants to know what is available now for one of his direct reports in the event of early retirement. We do not furnish that information except to the participant or as required in QDRO situations. However, we cannot find a legal site for that.

There is much protection on health benefits records and some states - such as Alaska - seem to have protection on retirement benefits information. Is there anything under ERISA or elsewhere?

What legal requirements are there regarding the confidentiality of the benefits payable under a qualified retirement plan?

I cannot find anything in the plan document.

I am the Benefits Specialist in the HR Dept in a corporation. A manager wants to know what is available now for one of his direct reports in the event of early retirement. We do not furnish that information except to the participant or as required in QDRO situations. However, we cannot find a legal site for that.

There is much protection on health benefits records and some states - such as Alaska - seem to have protection on retirement benefits information. Is there anything under ERISA or elsewhere?

My firm has just completed a certified audit of a 401(k) plan adopted by 9 employers, who I will call A through I for simplicity sake. Based on ownership percentages, the following controlled groups exist:

Company A: No controlled group

Companies B and C are a controlled group

Companies D,E,F,G, and H are a controlled group

Company I: No controlled group

When we asked the TPA to send us a draft of the Form 5500 for the plan, we received 4 5500's; one for each group described above. Adding up the assets and income of each 5500 equals the amounts on our audit of the plan in whole.

I have never encountered this type of filing. Is it correct? I was expecting one 5500 with a controlled group designation, and am quite confused. The TPA said they filed 4 5500's for 1999, attached the audit to each filing, and did not get the returns rejected by the DOL. Incidently, I called the PWBA helpline and stumped them too!

Any help would be appreciated. Thanks much.