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?

May an employer allow Health FSA elections to be modified mid plan year if they are required to comply with a new (less generous) plan design through state mandates, after moving to a new location mid-year?

Calendar year plan calculated ADP/ACP tests and made correction of ADP/ACP amounts. Only problem was that they forgot to calculate the losses the plan "earned" during the year.

Should this be treated as an "overpayment" and corrected by contacting the employees to retrieve those funds, if possible?

Thanks.

Is it true that a Plan does not have to comply with the max. permitted disparity of 401(l), but still qualify and pass 411 and 401(a)(4)?

That is a Plan can potentially have a formula of 1% up to cov comp plus 2% above cc and sll potentially qualify?

Is it also true that a company did not have to amend its SS offset Plan for TRA '86, but did so to pass 401(l) and potentially qualify for a safe harbor plan? I mean, why else would a Plan amend its SS offset Plan?

Gary

An employer sold his company as of November 16, 2000 and terminated his owner only money purchase plan that same date. However, for whatever reason, he over-contributed for the last plan year and now has excess contributions in the plan that cannot be carried over since the plan has terminated. Is the excess contribution treated as a reversion and if so is there a way to reduce the reversion penalty from 50% to 20% since he is the only participant in the plan???

Can a employee deduct the cost of personal medical coverage through their sponsored 125 plan.

How would you verify the expense.

Must a 204(h) notice be provided in the event that a Plan was amended for TRA '86 and changed its formula from a SS offset to a formula that met 401(l)? If 204(h) was not provided would the participant be entitled to old formula if greater (even though it was a TRA'86 change)?

Why were SS offset plans amended? Is it because they would not meet 401(l)? Or because they could not meet any safe harbor test? Isn't it true that a SS offset Plan could pass 401(a)(4) and even 401(l) by having a offset that is less than the 401(l) maximum offset?

gary

I am a retired individual who contributed $2,000 (for tax year 2000) to my Roth IRA on 1/18/00 thinking I would work at some point during the year. On 1/31/00, I realized I wasn't going to be able to work due to my wife's health and so I had that contribution reversed on 1/31/00 (distributed back to me as a Return Of Excess Contribution). As it turns out, I was able to find time to get a part time job in 2000, earned some money and now want to make that year 2000 contribution again but the service dept for the trustee on my account says I'm now ineligible to make a year 2000 contribution.

This just doesn't make any sense to me because I had that contribution reversed. As far as my account balance is concerned, I haven't made a year 2000 contribution.

Your advice on these matters would be greatly appreciated.