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?

Assuming that a participant's aggregate elective deferrals to a plan as of the date of the hardship distribution is $20,000 and assuming that he/she had received a corrective distribution from the 401(k) source (ie - ADP, 402(g) or 415) several years earlier of $1,000, is the amount available for the hardship withdrawal $20,000 or $19,000? In other words, do corrective distributions reduce the principal amount of elective deferrals for hardship available purposes?

Any help is appreciated.

Anyone have any experience with penalties being assessed for failure to file a form 945? All withholding was paid in a timely manner, but no 945 was filed for a couple years. I am having trouble locating info on penalties.

Thanks for any responses.

How is everyone handling the effective date of your restatements of plans which have had substantive amendments adopted between the effective date of GUST's provisions and the date of redrafting?

I'm sure others have run into this problem before. For a given year, a participant hits her 415 limit and ends up having some employer contributions held in a suspense account for her. She then terminates employment and looks to be paid out. Are these suspense account dollars forfeited and reallocated to all other Plan participants?

Thanks for your help.

The U.S. Chamber of Commerce is currently seeking volunteers to participate in its survey of employee benefit expenditures. The Study provides valuable information on the total cost of employee compensation, including average costs by company size, industry, and geographic region. The survey is only five pages and is simple to complete with your 2000 year-end figures at hand.

Companies may volunteer to participate in the survey by sending an e-mail to ebstudy@uschamber.com or by visiting www.benefitstudy.com to download the survey form. Each participating company will receive as a “thank you” a FREE copy ($75 value) of the published survey results, which can be used to evaluate your company’s benefit offerings. As an added incentive, two individuals will be randomly selected to receive a FREE Palm Pilot.

The deadline for participation is July 27, 2001. The results of the Study will be published in Fall 2001.

The U.S. Chamber of Commerce is currently seeking volunteers to participate in its survey of employee benefit expenditures. The Study provides valuable information on the total cost of employee compensation, including average costs by company size, industry, and geographic region. The survey is only five pages and is simple to complete with your 2000 year-end figures at hand.

Companies may volunteer to participate in the survey by sending an e-mail to ebstudy@uschamber.com or by visiting www.benefitstudy.com to download the survey form. Each participating company will receive as a “thank you” a FREE copy ($75 value) of the published survey results, which can be used to evaluate your company’s benefit offerings. As an added incentive, two individuals will be randomly selected to receive a FREE Palm Pilot.

The deadline for participation is July 27, 2001. The results of the Study will be published in Fall 2001.

The U.S. Chamber of Commerce is currently seeking volunteers to participate in its survey of employee benefit expenditures. The Study provides valuable information on the total cost of employee compensation, including average costs by company size, industry, and geographic region. The survey is only five pages and is simple to complete with your 2000 year-end figures at hand.

Companies may volunteer to participate in the survey by sending an e-mail to ebstudy@uschamber.com or by visiting www.benefitstudy.com to download the survey form. Each participating company will receive as a “thank you” a FREE copy ($75 value) of the published survey results, which can be used to evaluate your company’s benefit offerings. As an added incentive, two individuals will be randomly selected to receive a FREE Palm Pilot.

The deadline for participation is July 27, 2001. The results of the Study will be published in Fall 2001.

Employee is recieving 3 months of severance pay Starting May 1 (to July 31) for a plan with a June 30 year end.

The plan requires you to be an Employee (or on approved absence) with 1,000 Hours of Service and be an Employee on the Allocation Date.

Employee defined as any common-law employee of an employer. A leased employee, as described in section 414(n) of the Code, is not an Employee for purposes of this plan.

Is this person eligble for a contribution?

I'd like to hear some opinions or guidance on the preferred investment allocation for forfeitures in a participant-directed plan. As distributions occur throughout the year, should the forfeited monies remain invested in the accounts that they were previously in (i.e., those chosen by the participants), or should they be transferred to a more stable fund?

The reason this question comes to mind - occasionally an employer has a layoff and does not know to advise recordkeeper of partial termination. The employees are paid out their vested amounts - but later the partial termination is discovered and those affected employees need to be made 100% vested and paid the balance. What happens if the forfeited monies have lost value between the time of the first distribution and the second one? Does the employer have to "restore" the forfeited money to its value at the time of the first distribution?

has anyone else tried the latest version from the website bulletin board?

while it uses the defaults as coded in plan specs which is a great feature, i have encountered the following problems (curious if anyone else has):

1. printing of avg ben % test.

if ee is includable and not benefiting, the ee might cause the report to print out of alignment...e.g. the next participant starts printing in the middle of the report.

2. the non-benefiting non-excludable feature no longer works with the avg benefits % test

3. coverage appears to be including terms with less than 500 hours. (or at least a few extra bodies)

I saved the old version of rdiscrim and have gone back to that for now.

I understand that churches are exempt from non-discrimination rules in who they cover in a 403(B) plan. Are they also exempt from non-discrimination rules in offering a profit-sharing plan? My understanding is that this exemption happens as a by-product of not be subject to ERISA rules.

Are there other non-discrimination rules unique to profit-sharing plans that would control. Thanks for any help!

The reason I am asking is this - our church wants to cover certian full time employees at different contributions percentages - based on employee classification, length of service, etc.

Our company is in the process of changing 401k providers. They have given us a list of mutual funds into which we can make our investments. They have identified those new funds that they believe are most like the funds of the "old" provider. They have even given us the option to let them know where to invest our "new money"! So far - so good! However, with regard to "old money", i.e., our funds that are with the "old" provider, we have no choice. The company refuses to: 1) allow us to make a direct transfer (rollover)to an IRA; 2) allow us a choice as to where we can transfer our funds with the new provider. The only choice is that the company will decide on the specific mutual fund where they will invest our money - even when they have been instructed by the individual participant that the participant does not want to be invested in that fund!

To me this seems to be unethical at the least and perhaps illegal at worst. However, I'm not a 401k expert. It just seems wrong for a fiduciary to take a client's money and invest it against his/her wishes.

Any advice from someone more knowledgeable than I?

Wondering what you use to do batch MEA (Maximum Exclusion Allowance) calculations on 403(B) plans?