Employer A has a 401(k) with employee deferrals only and it's on a Standardized Adoption Agreement, calendar year/plan year.

Employer B also has a 401(k) with an Employer Match and is on a Standardized Adoption Agreement, calendar year/plan year.

Last quarter of year 2000, A and B become a controlled group but nothing was done to either Plan before the transaction to exclude the other Employer and utilize the 410(B)(6)© transitional rule. So as written, on the date of the transaction Employer A's Plan should have covered employees of B and vice versa.

The transitional rule is allowed if the coverage under the plan is not significantly changed during the transition period (other than by reason of the change in members of a group)...

Rev. Proc. 2000-20 now allows Standardized Plans to use the transitional rule.

Do you think each Plan could

1. "automatically" apply the transitional rule without an amendment excluding the other employer,

2. use the transitional rule but amend each plan to exclude the other entity, or

3. not be able to use the transitional rule even by amending each plan because the plan isn't written to exclude employees thos employees and an amendment now could be viewed as significantly changing the coverage.

Incidentally, their intent is to merge both plans mid-2001.

As an employer making a company match on a 401(k) Plan, does the company match amount get reported on the Form 941 line #2? If not, where do you report the match? Thanks...

I have a match formula of 100% on the first x% of deferrals with x being discretionary. I can do this easily in the match screen of the plan specs. However, if I want to allocate $100,000 in this manner, I've run into problems.

The system will allocate the 100,000 pro-rata on deferrals if I use the discretionary match - not what I want. If I put a value in for x the system ignores my entry of 100,000 in the transaction screen. Any sugestions?

Can a participant roll funds from a SEP into a 401(k) Plan?

What is the deadline for correcting an IRA excess contribution that was made March 2001 for year 2000?

I was told that the interim final rules and regulations prohibit insurers from not covering people that participate in certain activities: motoer cycling, horse back riding, skiing, etc. However, it supposedly allows insurer to exclude claims arising out of those activities. The rukes are to become effective in May. Any further information about this?

If a participant is part of a 403(B) and a 401(a) plan, are they still subject to 415© testing?

If a a participant has elected installment distributions, and occasionally needs a bigger check in a given month (for vacation, holidays, etc), is it allowable to accomodate request? I think the answer is no.

Is a request for installment distribution and irrevocable decision?

Thanks for any help.

I have a Roth IRA problem. I contributed the full $2,000 for my year 2000 contribution in January, 2000. Now my Adjusted Gross Income for year 2000 exceeds $95,000. It's around $102,000. I also invested $2,000 in '98 and '99 (for total contributions of $6,000). My account value has dwindled to $300 thanks to the lousy stock market. How do I resolve my year 2000 contribution if it's now partly ineligible? Thank you.

Under what conditions may a non-profit church organization establish a nonqualified plan?

Are placement fees for a nanny reimburseable under a dependent care plan? I can't seem to find any authority talking about what expenses are considered for the care of the dependent.

A husband died and directed all of his assets (including the business he owned) into a marital QTIP. For purposes of testing, can the ownership be attributed beyond the surviving spouse? Does the daughter receive any ownership for testing purposes?

I was diagnosed with diabeties while on cobra, may cobra benifits run out in about 30 days and I was wondering if indivdual health oplans can treat this as a pre existing condition

Can a non-leveraged ESOP be subject to an option to sell shares to an unrelated third party in the future? The option could state that the price would be the fair market value at the time. Currently, the unrelated third party is not a party in interest or a disqualified person, but over time, may acquire an ownership interest to be considered one. Section 54.4975(B)(4) precludes a call with respect to shares acquired with an exempt loan. What if the ESOP is non-leveraged? I am uncomfortable with the concept, but other than general prohibitions, cannot locate anything specific. Any thoughts?

Company A has an unfunded severance pay plan which takes effect January 1, 2000. In order to be covered by the severance pay plan, an individual must a) be terminated on or after the effective date as the result of a just-completed corporate merger, b) sign certain agreements including a nondisclosure/limited noncompete, and c) not have a separate employment agreement.

The severance pay plan offers a choice between two types of severance pay, installment and lump sum.

The first individuals who could have been eligible for the plan were those terminated on January 1, 2000. Technically they worked on January 1. First question: are the members of this group eligible participants at the beginning of the plan year?

Over the course of the year, hundreds of people were terminated and became covered by the plan. However, all but a handful elected the lump sum option, so their participation ceased as of the date they received their lump sum payment. Only about 15 people took the installment method. Consequently, at the end of the year, only these 15 people were participants.

My boss is having trouble with the fact that, because we potentially have a beginning count of 0 and an ending count of 15, but processed hundreds (if not thousands) of people inbetween, we might be exempt from filing a 5500. That just does not seem right to him, even though it's fine by me (since I'm the one who has to prepare it!).

Does anyone have experience with the finer points of participant counting and welfare plan exemptions?

I will figure my MRD before the end of this year. Over my years of employment I acquired IRA's, TSA's, and 403B's. Are these all treated the same when figuring the MRD?

Have you or someone you know tried to get the investment options in your 401(k) plan changed.

My name is Clifton Linton and I'm a writer with mPower Inc., a free educational personal finance and retirement website.

I'm looking to talk to a plan participant who is trying to or has tried to get their plan changed.

I'd like to know what aspect of your plan you wanted to change, what strategy you used to attract management's attention, whether you succeeded or not and how long this process took.

You can reach me at 415-875-2864 (work) (I promise to call right back, so my company pays for the call) or via email at clifton.linton@mpower.com

What are common pitfalls relative to the administration of Davis Bacon Plans? For example, it seems like general non-discrimination could be a problem when there are different contribution rates for different classes of workers. Any comments would be appreciated.

I have a situation where a corporation is forming a joint venture with another corporation where each will own 50% of the new entity (so is not in the controlled group). The new entity will form its own DC plan and for the first plan year would like to include compensation earned during the calendar year at the first corporation (for purposes of allocation and calculating the permitted disparity limit). I can find an exception to permit prior employer compensation to be used for DB plans but it appears from the 1.414(s)-1(d) regulations that only DB plans are permitted to use prior employer compensation. Does anyone have any thoughts on this issue -- if compensation from the other corporation is not used, then essentially participants will be hurt because the first corporation has a last day/1,000 hour rule which would not be satisfied because the transferring participants would be leaving mid-year. Any authority for a facts and circumstances analysis, assuming that it does not discriminate in favor of highly compensated employees?

a client has been making contributions to his Money Purchase plan but does not have compensation to justify the contributions. He has K1 income and thus is not entitled to make contributions to the MP Plan. What should he do to remedy the situation? Is this handled like a typical "non-deductible contribution." Are these contributions subject to the plan asset rule?