Can a plan sponsor elect to charge terminated participants (who still have an account balance) with a record keeping fee-- and at the same time not assess active participants with a record keeping fee?

Plan currently does not impose a participant record keeping fee. If, however, plan sponsor implements the above, can they only do it prospectively? I.e., Charge this fee to participants who terminate after the effective date of the change.

Hi Everyone:

I have been given the dubious honor of drafting a charter for the 401(k) committee.

Does anyone have a charter or guideline for their committee that they would be willing to share?

Electronically is great, otherwise, please fax it to me at 858-452-4258.

Thanks in advance.

Darryl

dweiss@orincon.com

Here's my wondering! With all the new litigation of 401(k)'s, we have seen numerous cases, such as the First Union case, where companies have been required to hire an independent investment advisor to monitor their 401(k) plan's investment options. Although this is not a requirement the IRS has burdened plan sponsors with, I would like to know what these plan sponsors ARE required to offer their employees in way of investment advise. Can anyone tell me what the law says, and the code in which this these requirements are located???

Heath

heathhightower@hotmail.com

Here's my wondering! With all the new litigation of 401(k)'s, we have seen numerous cases, such as the First Union case, where companies have been required to hire an independent investment advisor to monitor their 401(k) plan's investment options. Although this is not a requirement the IRS has burdened plan sponsors with, I would like to know what these plan sponsors ARE required to offer their employees in way of investment advise. Can anyone tell me what the law says, and the code in which this these requirements are located???

For purposes of a terminated DB plan cov'd by PBGC, is there a distinction between participants who are "missing" (sec. 4050) and participants who just don't respond to the notice requesting that they elect their benefit distribution forms? We have a fairly old termination (several years ('96/'97)) and a few genuinely "missing" particpants, and a few other participants who have just never returned paperwork re: the distribution.

Before the effective date of the current ERISA section & regs on "missing participants" (i.e., before 1/1/96), was it an option for the DB plan sponsor to take possession of lost participants' plan assets upon the plan's termination and keep them segregated on the books of the plan sponsor until the participant was located or came forward? Current ERISA 4050 only allows 2 alternatives: (i) annuity, or (ii) turn benefits over to PBGC, but several people have mentioned this alternative to me as an option.

Thanks.

Need clarification on the Form 5500 instructions for Schedule H, 4i.

Plan's only investment type is mutual funds.

The instructions discuss what are assets held for investment, and identify 7 exceptions. Mutual funds are listed as an exception.

Would the answer to H, 4i be NO because of this? If YES, why?

We have a safe harbor cross tested plan with a 401(k) feature, matching feature which one of the NHCE's terminated with less than 500 hours and receives a 3% safe harbor contribution (she's not eligible for the add'l PS contribution). What should be included in which test? Should her EBAR (including 401(k), match and safe harbor allocations) be included in the 410(B) test? Should she be an excludable employee because she termed with <500 hours? If there were 8 NHCE's, all 8 would have their EBAR's listed, but the avg bene test be calculated by dividing by 7 non-excludable employees? In other words, all 8 NHCE's EBAR would be totaled and then divided by 7 - the number of non-excludable employees?

What are the rules on changing an open enrollment date to one month later?

:confused:

Company X has about 500,000 "representatives" (most all incorporated) of which about 30,000 participate in a thrift plan effective 1/1/01.

How does Company X complete Form 5500?

Any guidance would be greatly appreciated.

I hope someone can help me with the following:

Scenario: A small group in Oklahoma has a Medical Reimbursement account through section 125. An employee makes claims for and is paid the balance of his account early in the plan year and then terminates employment. The employer is unable to payroll deduct the remaining contributions and is out of pocket the “at risk amount”. Later in the same plan year, the terminated employee is re-hired.

Question: Can the employer resume payroll deductions? Additionally, can the employer increase the deduction amount though the remainder of the plan year in order to recoup the full amount that was lost?

I appreciate any help you can give me.

To obtain the maximum lump sum under 415, what rate do I use.

I have an EOY val, plan year 3/1/2000 - 2/28/2001.

The way I understand it, I should be using the GATT rate in effect as of the first lookback month (which I am thinking is 6.23% the February 2000 rate).

My firm offers the option of contributing to our 401k on either a pre-tax or post tax basis (they match 25% of the first 6% of contributions). I'm 24, and willing to take certain investment risks. I haven't found, however, postings relating to the advisability of investing pre-tax vs. post. It's my understanding that pre-tax offers an investment tax shelter; however, must I still pay tax yearly on investment income on this money, or is it deferred? Is a post-tax 401k investment like a Roth IRA in the sense that all income is deferred? I realize that this is a somewhat individualistic question, but does one option make more sense than the other?

Thanks.

I need advice on the wisdom of opening a second Roth account. I opened my first Roth the year they became available and that account is with a personal advisor.

I also have money in a Fidelity Brokerage account (401K Rollover) and would like to keep this money separate from the money I have with the advisor. My desire is to move funds from the regular IRA Rollover to a Roth account while stock prices are low so I pay less tax. Will the new Roth account be governed by the same rules or has something been "grandfathered" to earlier accounts that will be lost to a new account? I am 51 years old so the 5 year time limit isn't a concern at this point.

Thank you for your help.

kks

QUICK HISTORY: i am the owner of a small business with 35 employees. july of 2000 i began a new 401k plan for my employees with the intent of "rolling over" the existing plan into the new plan.

the new 401k plan, to my dismay, could not accept the "after tax" contributions for the two plans were not considered "like plans" by the IRS

the "easiest" way out of the old plan was to "terminate" the plan seeking approval from the irs...boy was i wrong.

here we are over one year later, and my first pension plan still has not released the funds on deposit with them, saying they are awaiting the "determination letter" from the irs.

THE KRUX OF THE MATTER: back in july of 2000,when the plan was to "rollover into the new 401k", i was given the choice to leave the money invested in the plan, or to put all the funds into a fixed return "money market type account." given the turbulence of the market, i chose the latter, the original pension plan complied and did just that.

in december of 2000, when i had my hand forced due to the time frame and cicumstances, i informed my original pension plan that since the "easiest" way out for me was to "terminate" the plan...i did just that and the required forms were sent to the irs.

so, for the period of july 1, 2000 - september 30, 2000 the all of the funds were invested in a "fixed income" money market account.

THE SUPRISE: less than one week ago today, because a former employee made an inquiry with the original pension plan, i was informed that the funds did not remain on deposit in a "fixed" interest account, but because of the termination proceeding that began in 12/2000, the funds were deposited back into the general stock account to share in the obvious losses suffered by most segments of the market during the period 10/1/00-6/30/00. i was never informed of this investment change by anyone at the original pension plan.

THE MILLION DOLLAR QUESTION: can this be right? were they allowed to do this? i can't believe that this is happening, and i have run out of people to talk to at the old pension plan. they just tell me, "that's the way it is. period."

thanks in advance for any insight that anyone can provide me with.

If a non-U.S. citizen owns a U.S. corporation that sponsors a qualified plan it appears that he cannot be the plan's trustee. It seems that he should either get a U.S. financial institution/TPA that offers trustee services or appoint a U.S. citizen (or group of) to be trustees. Are there any other options? It's been suggested that the U.S. corporation be a trustee, but with the sole owner not being a U.S. citizen it appears to cause the same original problem.

IS THERE A SIZE AT WHICH INSURED HEALTH PLANS MUST BEGIN TO FILE 5500'S? THANKS

Any suggestions for a company that does not know if they've filed 5500s for their welfare plan in the past 2 years?

The company has had tremendous turnover and simply does not know (cannot find any copies) whether or not 5500s have been filed. Prior to 1998, they were under 100 lives, fully insured with no fringe benefit plan. It was not until 1998 that they ever would have needed to file.

Any thoughts?

May a defined contribution plan eliminate its early retirement provision? Is it possible under some circumstances and not in others?

If an ERISA plan states that parents have 30 days to enroll a newborn under the Newborns' and Mother's Health Protection Act, is the newborn automatically covered for the first 29 days if he/she is not enrolled in the plan?

I am finding out that a lot of my clients are filing for extensions this year. Since this is only my second year in the 5500 world, and last year not providing a comparison point because of the automatic extension, what is the "typical" filing pattern in a "normal" year?

Many of my clients are Large plan filers, so I'm hoping this is a normal occurrance. Also, many seem to be waiting until the last possible moment to file Form 5558. Is this typical???