Can an employer make LTD a mandatory - employee paid benefit?

ok, I see where a number of people have downloaded the other report, haven't heard any negative feedback, so lets try another one.

6.0 report, designed to provide much of the info for the Schedule I. We have one person in the office who fills the forms out, so it is a big help to him.

There are certain user fields that can be used, I think they are actually indicated on the print out.

as with any report, certain modifications might be needed. e.g. I think I have a different version if forfeitures don't reduce contribution. or if forfeitures in suspense at begining of year are used to reduce the contribution. I don't think I have worked that one at yet.

Since Relius doesn't distinguish between types of distribution (e.g. corrective distribution vs regular distribution, you may have to adjust the report a little bit in some cases)

anyway, report is intended to give a good start toward the 5500.

The majority of contract employees working for a company were involuntarily transferred to a non-related employer as of June 8, 2001. The company, now left without the majority of its workforce, will close shop on September 30th. We have advised the company to file for a determination letter. It has always been my understanding that once a plan is terminated and a determination letter request is pending, participants are not able to take distributions from the Plan. The plan is in a "black-out" period, per se. However, the client wants people to have access to their money. Can we allow all employees who were transferred to take distributions from the Plan and then terminate the plan in September? At that point there should be no participant's left with balances. Am I missing something?

Any thoughts would be greatly appreciated?

A participant has a life insurance policy in the plan. The participant takes a loan of the cash value from the policy directly from the life insurance company without going through the plan, despite the policy being an asset of the plan.

Is this loan a prohibited transaction due to not being made in accordance with specific provisions that are set forth in the plan, or could this be an allowable participant loan as long as the plan does have a written loan program? What additional info. do I need to determine whether or not this is a PT?

i have an employer a with several plans (plan # 1 -5). in 2000, they acquired a new company with a plan (plan #1) which employer a will sponsor. what plan # should i use on the 2000 form 5500? #6?

If an employer wants to adopt a 401(k) plan mid year (no profit sharing or match), can they make the new plan effective january 1 or do they have to make it effective as of the current date?

please include the legal basis. thank you.

In a cross-tested plan what codes would you use on the 5500? 2A is for the cross-tested piece. Would you also put 2E because it is a form of a profit sharing plan?

I need everyones help!! I am a 21 year old male living in California. I work very hard at my job and I am now realizing that working hard doesnt mean that your guaranteed to make lots of money! Some co workers suggested to look into the "Roth IRA" so thats why I am here! If anyone happens to read this and they have some helpfull information I would really appreciate it! Also if you have any suggestions for me then I would really like to hear it. My email address if ryder_brickley@yahoo.com Thanks

The SEP IRA limits for 2002 do not appear to be changed under EGTRRA. They remain at 15%. Compensation will increase to $200,000 capping SEP contributions at $30,000. Profit Sharing Plans will be able to accept 25% of pay and will be capped at $40,000. Does anyone know if this was intentional or was it an oversight? If it was just an oversight, is it likely to be addressed in separate legislation?

We have a client with a fiscal year and plan year ending September 30, 2001. Is it permissible to change the plan year (i.e. have a short plan year from October 1 to December 31, 2001) and have a new plan year beginning January 1, 2002 in order to accelerate the applicability of the more generous limitations under the EGTRRA which becomes effective for plan years beginning on or after January 1, 2002?

I would like to know if this feature is used by any recordkeepers with Quantech and if it is found to be useful. Please give examples of how you may be using it in plan administration. Thanks

We have a Profit-Sharing sponsor who decided to "terminate" the plan on his own and allow participants to receive distributions/rollovers without providing a written 402(f) notice to participants. He claims that everyone rolled their money over--it remains to be seen whether he did these as "direct rollovers" or made out checks to participants. In any event, I'm assuming this is not a qualification error as defined in Rev. Proc. 2001-17 and is simply an error subject to the penalty described in 6652(i) ($100 for each failure). Can someone confirm that this is not a qualification failure?

Q(1). In a defined contribution 401(a) governmental plan with an employer "pick-up" contribution under Sec. 414(h), can the employee be given a one-time enrollment election to 1) elect a zero contribuiton and therefore never participate; 2) elect to participate, but have the option of irrevocably electing from 1 to 10% of base pay and bonus; or 3) irrevocably elect a different percentage from the bonus amount as compared to the base percentage? Alternatively, if this doesn't work, just what might be allowed to give the employees some flexiblilty when enrolling?

As a TPA we have been asked to commingle assets of a 403(B) and a Money Purchase Pension and recordkeep as one plan. We have the ability to establish separate sources of money for reporting purposes. However, we are not sure if we can legally hold assets for both plans under one custodial account.

Company A and Company B form a controlled group, each maintains their own 401(k) plan. Plan provisions are identical. Company A makes a profit sharing contribution; Company B does not. How do I perform the coverage testing? It seems to me that I test Company A by including all employees and treat employees of Company B as eligible and not benefitting. If Co. A passes then it has met 410(B) on its own and I perform all other nondiscrimination tests separately (Co. B automatically passes on its own because no HCE's benefit). Is this correct?

FYI - a modification is coming from Blaze for the SAR - you may have noted that if you leave the plan year dates blank on the 5500 (which is logical to do if a calendar year plan), the SAR plan year dates show as 1/1/99 - 12/31/99 even though the financial data, etc., is for the 2000 plan year. One of our clients noticed this, called me, I groaned, notified Blaze and re-did all SARs for previously completed plans. I don't have any idea when gov form modification will be completed but do know all you need to do is put in the plan year on the 5500.

The order specifies that the alternate payee is to receive 50% of the participants retirement benefit multiplied by the years of plan participation while married and divided by the total number of years of participation to the participant's retirement date.

If the participant dies the order stipulates that the alternate payee's portion is payable to her on the date the participant would have attained retirement age.

The order does not contain the usual QPSA language.

Let's assume the participant dies while employed and before attaining retirement. It seems to me that the alternate payee is not entitled to anything because when the participant dies, his retirement benefit goes to zero.

Has anyone ever seen a DRO like this? I do not think that it would be qualified since the intent is to pay the alternate payee something if the participant dies prior to retirement and this would require payment of a benefit not provided for in the plan.

The software package (Pension Forms Systems with Hotdocs) we were using to send out 402(f) notices to participants does not work with Microsoft word 2000 now.

Does anyone know of a good vendor to purchase this type of software?

Thanks,

Ronnie Wasel

ronnie.wasel@gabbardandco.com

Can someone please help me? If an individual wishes to withdraw contributions only from a Roth IRA for the purpose of purchasing a home as a first time homebuyer, but the IRA has only been in existence for four years, what would be the penalty?

Would you only have to pay the 10% early distribution, would you have to consider these monies as income along with the 10% early distribution penalty, or would this be considered a qualified distribution? Any help on this matter would be greatly appreciated. Thanks

A plan participant is terminating employment to go with another company. His account in his profit sharing plan consists partially of employer securities. He wants to roll over the employer securities into his new company's plan. When he finally takes a distribution (and subsequently sells the stock), do the net unrealized appreciation rules in 402 apply in the same manner as if he'd received a distribution fro his first employer and then sold the stock?