A non-owner plan participant terminates employment past age 70-1/2 and is now required to take the minimum required distribution from the Plan. This person also has money in a traditional IRA. Does the MRD have to be calculated and taken separately from both the Plan and the IRA, or can they be taken entirely from either the Plan or the IRA? Does it matter if the IRA is a Roth IRA?

We have two employees who are convinced that if we give them

the amount the employer paid for LTD premiums for the year

they can include the amount as taxable income on their W-2

and pay the taxes on that income, thereby rendering any LTD

benefits received in future non-taxable.

I have my doubts. Any thoughts?

Can a COBRA QB (the former Employee) with COBRA family coverage drop a QB spouse at any time (adversarial situation, but not a divorce or legal separation)? Only at Open Enrollment? With or without the QBspouse's knowledge and consent? What is the Plan's responsibility to notify the QB spouse of being dropped from COBRA coverage at Open Enrollment? Or anytime? What are the "dopped" QB spouse's legal right to continue COBRA coverage?

If a government plan is over-funded, do the employers and/or employees have any right to the excess contributions?

2001 ERISA OUTLINE Book, ELECTIVE TRANSFERS page 6.42. This discussion of elective transfers is not a scenario that our company has been exposed to. It is not clear from the examples as to when this type distribution would occur.

Is it only when the employer maintains more than 1 qualified plan?

Does anybody know a good site where you can check the state taxability of retirement or IRA distributions? I couldn't remember if IRA distributions were taxable in Virginia (I'm from Illinois), and could not find a place to check whether or not they were.

Thanks for any replies.

Are the release of new 457 regs imminent? If so, will plan loans and taxability of distributions pursuant to domestic relations orders be addressed?

David

Does HIPAA, specifically pre-existing condition exclusion, apply to individual health plans when an employee who was covered under the group plan is terminating and wants to convert directly to the individual plan? This employee has a work-related illness and is being told she cannot get individual coverage due to the pre-existing condition.

Kathy

Do the new rules for calculating RMDs apply to distributions to beneficiaries when the IRA owner died before 2000? I was under the impression that they did, but have heard that there are some people who think they don't.

In a top heavy DC plan with multiple entry dates, can the TH minimum allocation be based on 415 (or W-2) compensation as a participant, rather than a full year comp.?

The ability to do this is not in the 416 regs. Is there a specific cite for allowing this?

Is there a private letter ruling from IRS, permiting the use of a governmental trust to provide tax advantages for assets set aside for eligible medical expenses in retirement? ie, a retirement health savings program that is pre-funded. Who do I call or where can I research this topic??? Thanks!

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The Safe Harbor if 3% can be used in cross testing as long as integration is not imputed on it. This means a spread sheet to add different pieces together - 401(K) plus SH plus (PSP with integration) for ABPT, drop the 401k but keep SH for rate group test.

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Somebody posted the above message, I believe it was rcline46.

The posting concerns me, we pay a service company for legal advice and they provided us counsel such that:

SH is not included in the rate group/classification test but it is included in the ABPT?

Can I please get 2nd, 3rd, and 4th opinions?

Which way do you think? And where in the regs can I find documentation to back it up?

I am extremely new to cross-testing and very concerned that I may do it wrong.

All opinions welcomed!

Thank you - ZM

I'm 25 and a police officer. although I have a retirement plan, I know it will not be enough to support me in the future. so I want to start an roth account but i have no clue about what steps to take.

I currently have 2 loans (as allowed by my 401K plan). Have recently ran into very hard times and have asked for a hardship withdrawl from 401K... Employer has stated that unless I am losing my primary residence or need the $ for secondary education, the federal regulations are set so that I cannot receive a hardship withdrawl. I have looked up other info on the web and it all states that a hardship withdrawl is at the employers discretion. Can anyone confirm/deny this? Though I am not losing my primary home (yet) I am over 60- days past due on many bills including vehicles which are on the verge of being repossessed. Please help ASAP. Thanks

Can anyone provide a cite that says that S-Corp distributions are treated as income in an ESOP?

Or, is it just common sense? (S-Corp distribution is part of the company's earnings being distributed to shareholders, akin to dividends).

Thanks.

I have a participant with an outstanding loan who claims that he cannot afford to continue making his loan repayments, so he is considering leaving the company so that he can payoff the loan and receive his vested account balance in the plan (clearly, he has some serious financial problems).

I want to consider the possibility of voluntary loan defaults. I read a previous thread, regarding this topic, but have some questions that I'm hoping someone can answer.

How does a participant officially rescind his/her payroll deduction agreement? Do you need something officially on file to document this? (I would think yes).

Does the loan continue in default (and accrue interest) until the participant has a distributable event under the terms of the plan? Can plan language be added so that the loan can be a deemed distribution in the year of default? (This is a volume submitter plan with a loan provision, not an individually designed plan, if that's germane).

Does any language need to be added to the plan or loan policy to permit voluntary loan defaults or is this simply something that you cannot deny a participant?

Any help would be greatly, greatly appreciated!!

We have one PS plan that has a two year of service and age 21 for eligibility requirements. Once eligible, of course, 100% vested immediately. Does the 1000 hour rule apply as it typically does for the usual one year/age 21 plans? One employee has her two years in but only worked 973 hours each year and I want to confirm she's still not eligible. Thank you.

Has anyone heard the phrase "true up transfer" ? I think it has something to do with the improper allocation of a profit sharing plan contribution .... too much is allocated to one participant's account & too little is allocated to another participant's account. As a result, funds have to be transferred from one account to another... (just my guess).

Can anyone shed some light on what "true up transer" might mean ?

I have a call in to Corbel, but in the meantime, does anyone know if there is a way to copy election percents from one person to everyone else?? I have a client with about 250 participants and they need to have the same election percents keyed in their secondary allocation set because we are allocating forfeitures back to originating investments and from what Corbel has told me, this is the only way to make it happen.

The copy feature would be extremely helpful to us if there is a way to do it.

When the QDRO states the ex-spouse gets a percentage of the participant's account do we calculate that percent on the whole account balance or just the vested portion?