An IRA owner wishes to have assets distributed via check made payable to his spouse. His election to have funds distributed is in writing (via custodian's distribution form), but what is your interpretation of the "distributee" or "payee"? Should distributions be required to be received by the IRA owner, or could payments be made to another individual (or entitiy, for that matter)?

Thanks in advance,

Chris

I have a client with a SIMPLE 401(k) experiencing financial difficulties. It would like to suspend the match (100% up to 3% of comp.) Because Match is required in a SIMPLE 401(k) would this client also have to suspend the EE deferrals? Is there any way for the company to suspend the match but allow EE deferrals to continue? Thanks for the help.

I have a husband and wife that closed their corp. and terminated the DB plan and rolled their lump sum distributions to a segregated acct. in their new sole proprietorship DC plan. My limited understanding of loans is that loans are not allowed from a qualified plan of a sole proprietorship. If that's true, in this case does it apply to the segregated acct. as well?

Assume that an employer has a 401(k) and a nonqualified "mirror" plan. If an employee who is eligible for the nonqualified plan changes his or her deferral election to the qualified plan, is it permissible to also change deferrals to the nonqualified plan?

In other words, is the deferral rate to the nonqualified plan irrevocable until the end of the year?

Would it make sense to convert a 401(k) that matches with employer securities into a KSOP since deductions will be permitted for reinvested dividends pursuant to EGTRRA?

The hardship safe harbor definition clearly allows a distribution for education, but what about to pay down student loans? Does anyone have any experience with this? Would the plan have to abandon the safe harbor and specifically allow for this?

Would back taxes typically qualify for a hardship withdrawl? Would there be a penality if the withdrawl was distributed directly to the IRS?

Can anyone explain the significance of the following from EGTRRA?

"SEC. 632. EQUITABLE TREATMENT FOR CONTRIBUTIONS

OF EMPLOYEES TO DEFINED CONTRIBUTION

PLANS.

(a) EQUITABLE TREATMENT.—

...

(2) ...

(B) by striking paragraph (2), and © by inserting ‘‘or any amount received by a former employee after the fifth taxable year following the taxable year in which such employee was terminated’’ before the period at the end of the second sentence of paragraph (3).

How do you calculate the Top Heavy percentage where one of the Key employees (now legally dviorced) has transferred half of his account to his ex-wife (the alternate payee)?

He is a more than 5% owner.

She has never been an employee.

In this case the plan is not top heavy for 2001 even if her balance is included. I'm just curious.

It seems to me that her balance would not be included as she wouldn't meet the definition of Key employee (as she was not an employee). However, if she was an employee her balance would be included for the look back period as she was a more than 5% owner during 2000.

May a plan loan be taken to buy out a former spouse's interest in a principal residence? Prop. Reg. 1.72(p)-1, Q&A-8 says refinancing does not generally qualify as a principal residence plan loan. However, if the plan loan is used to repay a loan from a 3rd party, and the plan loan qualifies as a principal residence plan loan without regard to the loan from the 3rd party.

How to analogize?

I have been given conflicting information regarding an IRA belonging to a parent. At the time of death (2000), my sibling took their 1/2 of the account and I was so overwhelmed at the time that I thought it best if I just leave it be. My local bank, where the account is held, said that was fine and the fact that my sibling took $ out met the minimum distribution for the year. So now a year later and the account is still there, accruing interest and they say I can leave it there indefinitely but need to meet the minimum distribution yearly. I was not sent a 1099 last year and my sibling did not receive one either as one was sent to the deceased parent for tax filing. Just want to know if this is correct or if I need to do something else with this....my bank has been incorrect before about products etc....................Thanks in advance for any help anyone can send!

Companies have generally have open enrollment for medical insurance elections once per year because that is when employees are permitted to change their elections under the cafeteria plan rules. But is open enrollment required? 401(k) elections are kept from year to year.

Any cites for your assertions?

I am interested in finding out what the current standards are for tuition assitance plans in Corporate Universities. ie: how much $$$ are employees reimbursed each year?

LAYOFFS ARE ABUNDANT AS ASSETS PLUMMET.

WITH ALL OF THE RIFS IN THE 401K AREA WHAT COMPANIES ARE YOU AWARE OF THAT ARE EXPANDING THEIR FORCES?

Is open enrollment required for a self-funded medical plan as a part of a cafeteria plan? What if no cost changes occur? Changes in family status can still occur. Why do 401(k) elections as a part of cafeteria plans get to "rollover" year to year?

My mom has a roth IRA and I'm in England rigth now. On the phone my mom

said she lost money in her IRA. I don't know if she meant that she withdrew

money or not. So I was wondering if someone could be kind enough to answer a question. Are the rates quoted when opening a IRA guaranteed or are they dependent upon the performance of the investment scheme used by the company she has the account with? And does economy slow down or increases effect the interest rate? Any response will be appreciated.thanks.

Is it ever a good idea to use 401k proceeds, after loosing a job, to pay down debt or pay off a second mortgage so as to lower monthly expenses? Are there any circumstances where the penalty doesn't apply? (assuming under age 59 1/2)

Does a plan have a "Favorable Letter" within the meaning of Rev. Proc. 2001-17 if it has a favorable letter that considers TRA '86 but, after receipt of that letter, was amended and restated on a new document?

Although the new document began as a prototype, because of certain changes made to it, it is now an individually designed plan, so we can't rely on the prototype's letter.

The plan was initially adopted after December 7, 1994, so if we haven't already got a "Favorable Letter," I guess the way to satisfy the requirement is to submit a determination letter request on the amended and restated plan, including GUST amendments, before 12/31/01.

Any thoughts though on whether the letter we've already got is adequate?

Has anyone tried to go directly through NSCC rather than use an intermediary such as SunGard-Expediter or Mid Atlantic? We currently use SunGard, but have just been approved by NSCC. Much feedback we have received is that dealing with NSCC directly is extremely difficult, but the trading/reporting costs are miniscule.

Hi Everyone,

Two issues to inquire about.

Has anyone heard of an "OFFICIAL" IRS position (in writing) on the applicability of the New RMD Rules for beneficiaries of decedent IRA's were the IRA owner died in 2000 or 2001. IRS seemed to indicate verbally last spring that this would be possible but it was not an official IRS position at that time a while back. Has IRS so ruled? If so is any citation available?

Has anyone seen any additional "OFFICIAL" IRS information on the ability of an IRA Beneficiary to name a Beneficiary during their residual payout period. Yes, there have been several PLR's on this issue dating to the early 1990's and yes many IRA Fiduciaries do it routinely these days, still many do not. I have had several Pension Attorney's indicate to me that the naming of a beneficiary is the province of only the Trust Grantor and not the Beneficary. You can conjure up lots of implied liability in this regard, yet the NEW RMD Rules seem to cry for the ability for this to be permitted.

Looking for tangible information and not conjecture. ;-)

Thanks to all.

David H.