My company would like to set up a bonus plan for individuals who remain with the company to close out a program that has been terminated. The bonuses are somewhat substantial. The employee must not be offered a new position with the company and must stay until the project is closed out in order to receive the bonus. The director however, does not want to label this a "retention bonus." Does anyone have any suggestions as to what we can call this program? Thanks!

Can someone please tell me what government agency oversees a COBRA plan

In determining who must receive the 3% Nonelective Employer Safe Harbor Contribution, can anyone site any notice(s) that define(s) the "Employees Eligible to Defer"?

Does anyone have some information on what a corporate-owned nonqualified annuity is? I'm just looking for some background on it or some direction on where I could learn more about this type of annuity.

If my employer offers a SARSEP Plan but I have never signed up for the plan, can I still take the deduction from a Traditional IRA ?

I asked my employer about this and he assures me that I can take the IRA deduction. According to Publication 590, I cannot take the deduction if my employer OFFERS a pension or annuity plan. I don't want to get penalized by the IRS if my boss is incorrect. Is a SARSEP plan considered a pension or annuity ?

I am interesting in QPA certification sponsored by the ASPA. but I am concerned about the depth of the material covered in their P-1A and P-1B study program. Is it a good program for someone with a little over a year experience in the retirement industry? I have already gone though the Daily valuation Book and was not thrilled with the content.

Do you have much info on career advantage for those with an ASPA certification?

I participated in my employers 401K last year. I left their employment in March after contributing approximately $4000.00. Can I also contribute to a Roth IRA? And if so, how much for 2000?

Is anyone familiar with the circumstances under which payments from a pension plan to a disabled retiree for a service connected disability could be considered non taxable? My understanding is that the payments must be in the nature of workers' compensation. So if service connected disability retirement is a provision under a local government's police pension plan, can payments from the plan to the disabled retiree be excluded from taxable income?

Does anyone have an opinion about what extent a Form 5310 determination letter provides plan document reliance? A GUST amendment is of course required to get the 5310 favorable letter. The determination letters I have received usually mention the GUST amendment in the letter. If you have a favorable 5310 letter, is it overkill to restate the plan into a GUST document?

A daughter complained to her father about her life and how things were so hard for her. She did not know how she was going to make it and wanted to give up. She was tired of fighting and struggling. It seemed as one problem was solved a new one arose.

Her father, a chef, took her to the kitchen. He filled three pots with water and placed each on a high fire. Soon the pots came to a boil. In one he placed carrots, in the second he placed eggs, and the last he placed ground coffee beans. He let them sit and boil, without saying a word. The daughter sucked her teeth and impatiently waited, wondering what he was doing. In about twenty minutes he turned off the burners. He fished the carrots out and placed them in a bowl. He pulled the eggs out and placed them a bowl. Then he ladled the coffee out and placed it in a bowl.

Turning to her he asked. "Darling, what do you see."

"Carrots, eggs, and coffee," she replied.

He brought her closer and asked her to feel the carrots. She did and noted that they were soft. He then asked her to take an egg and break it. After pulling off the shell, she observed the hard-boiled egg. Finally, he asked her to sip the coffee. She smiled as she tasted it and smelled its rich aroma. She humbly asked, "What does it mean Father?"

He explained that each of them had faced the same adversity, boiling water, but each reacted differently. The carrot went in strong, hard, and unrelenting. But after being subjected to the boiling water, it softened and became weak. The egg had been fragile. Its thin outer shell had protected its liquid interior. But after sitting through the boiling water, its inside became hardened. The ground coffee beans were unique, however. After they were in the boiling water, they had changed the water.

"Which are you," he asked his daughter. "When adversity knocks on your door, how do you respond? Are you a carrot, an egg, or a coffee bean?"

~~~~~~~~~~~~~~~~~~~

How about you?

Are you the carrot that seems hard, but with pain and adversity do you wilt and become soft and lose your strength?

Are you the egg, which starts off with a malleable heart? Were you a fluid spirit, but after a death, a breakup, a divorce, or a layoff have you become hardened and stiff. Your shell looks the same, but are you bitter and tough with a stiff spirit and heart?

Or are you like the coffee bean? The bean changes the hot water, the thing that is bringing the pain. When the water gets the hottest, it just tastes better. If you are like the bean, when things are at their worst, you get better and make things better around you.

How do you handle adversity? Are you a carrot, an egg, or a coffee bean?

Author Unknown

I have a question regarding calculation of 401k deductions when there is also a pre-tax medical deduction. My wifes employer deducts her medical insurance pre-tax premium first and then calculates her 15% 401k contribution based on her gross salary minus the medical premium. Is this correct?

Not only does it result in a slightly less contribution each paycheck to the 401k account but the employers match is also reduced.

Any input would be appreciated...

thanks

Seems to me these are underutilized for small start-up companies. No consulting firm that I know of wants to talk about them. Brokers don't want them because there's little money.

So, I would think that means the only people selling or advocating them them may be pushing for clients to do alternatives. Any programs out there that offer these plans with reasonably objective advice?

Anybody out there do business by advising on such programs?

I use Quantech 6.0. I am working on a non-standard age weighted profit sharing plan. Two employees terminate with less than 500 hours so I don't include them in 410(B). When I tests Quantech correctly identifies the employees included in coverage tests under 410(B), however, when Quantech actually runs the tests it includes the 2 people who termed with less than 500 hours.

Has anyone run into this problem? If so, how do I fix?

Thanks for any help.

Same Desk Rule

One corporate member of a brother sister controlled group is sold and the employees who participated in the contolled group's 401k Plan continue in the same job with the purchaser. Thus they are "same desk" employees. The purchaser is then sold to a third company and the employees continue in their same job. It appears to me that the "same desk" status remains. Any comments.

When using new rules to excude <21<1yr service EE's from test, when is an employee who satisfies statutory requirement included in test. For example, EE#1 hired July 20, 1999. Plan has quarterly entry. Do we count his comp and deferrals from October 1 2000 forward only toward the 2000 test, or do we need to count entire years worth toward test since he became eligible in year, or is there a way we don't have to count him until next year, or is ot handled in another way altogether?

A friend of mine converted her Traditional IRA to a Roth IRA in 1998 to take advantage of the 4 year spread to report the income. As the market is now in the tank, she is considering recharacterizing the Roth back to Traditional, in order to not to have to continue to pay taxes on the higher conversion amount.

Is this allowable? I have read my various resources and cannot come to a definitive conclusion. I would think that she could do this, and avoid paying the 2000 installment of the conversion, as I believe you have until the due date of your 1040 to accomplish this.

Any help would be appreciated.

Does anyone have a sample letter which they send to terminated participants (with less than $5,000 vested), which gives them a certain number of days to provide instructions on how they want their account distributed--otherwise they'll have their account paid out? (Could you e-mail me this?)

Employer has both a MPPP and PSP. Employer has funded the maximum 30,000 for the owner in the PSP then nothing in the MPPP because of 415 limits. Seems to me they should have funded the MPPP first because of minimum funding requirements then funded any additional in PSP. Is what they did ok?

Can an LLC have both a SEP and a regular 401(k) plan peacefully coexist? There is only the owner eligible for the SEP contribution (relatively new company), and the 401(k) has lots of participants. He was only able to defer about 3000 in 2000 due to ADP restrictions. He would like to make up the balance in the SEP. Is this ok? He wants to kill the SEP plan next year before any participants become too close to becoming eligible for a contribution. Something sounds fishy but I'm not sure what.

Calendar year safe harbor 401(k) Plan currently matches, on a payroll period basis, 100% of the first 3% of pay deferred (automatically invested in employer stock), and 50% of the next 3% of pay deferred (to be self-directed by the participant). Plan sponsor satisfied the notice requirement prior to the start of the year. Now, plan sponsor wants to increase the second-tier match to 100% of the next 3% deferred, and will give employees at least 30 days written notice in accordance with the safe harbor guidance (so that they can adjust deferral elections if appropriate). I can't see anything wrong with this. Does anyone see a problem?