I'm looking for thoughts on the following beneficiary situation under a 401(k) plan:

While married, participant names spouse as primary and sole beneficiary on plan's beneficiary designation form. A few years later the marriage ends with a legal divorce. The divorce decree has general language that neither spouse will make claim to any portion of the other's retirement pension or savings plan benefits. The aforementioned beneficiary designation is never updated by the participant. Then, the participant dies.

Does the beneficiary form prevail? Or does the language of the divorce decree have an effect?

What if, instead of dying, the participant had simply re-married? What effect, if any, does this have on the "old" beneficiary designation that still shows his then ex-spouse as primary and sole beneficiary?

Thanks in advance for any thoughts or reactions.

Cole

I'm looking for thoughts on the following beneficiary situation under a 401(k) plan:

While married, participant names spouse as primary and sole beneficiary on plan's beneficiary designation form. A few years later the marriage ends with a legal divorce. The divorce decree has general language that neither spouse will make claim to any portion of the other's retirement pension or savings plan benefits. The aforementioned beneficiary designation is never updated by the participant. Then, the participant dies.

Does the beneficiary form prevail? Or does the language of the divorce decree have an effect?

What if, instead of dying, the participant had simply re-married? What effect, if any, does this have on the "old" beneficiary designation that still shows his then ex-spouse as primary and sole beneficiary?

Thanks in advance for any thoughts or reactions.

Cole

Employer can not locate participants to open an IRA account for the SEP. What are the employer's options? Does the money go back to the employer? Do they open another type account for the missing employee?

Any assistance is appreciated.

70 1/2 participant has requested full distribution, but has also requested that we not withhold 20%. He claims that his income is not enough to file tax return (even including distribution). Can we do that or is there a possibility that we could be liable for the taxes on that distribution? Is this between the taxpayer and the IRS, or are we required to withhold?

With the IRS Notice 2000-3, the plan sponsors were able to stop doing the safe harbor match provided they issued a notice atleast 30 days prior to the date the plan sponsor wanted to discontinue the safe harbor match.

Can a Plan however skip 1 quarter from doing the safe harbor match and restart the safe harbor match the next quarter? If they are allowed to restart do they have to make up the safe harbor match and also what about testing?

The notice only mentions that if they decided to stop doing the match then they would go back to testing for the entire plan year using the current testing method.

Thank you and Happy New Year to all the members!

I'm wondering whether I've missed the deadline for making a 2000 Roth IRA contribution. Is the deadline December 31 or April 15? Thanks and Keep Hope Alive.

Do plan sponsors or their service providers allow participants to convert their loans to coupon payment upon termination?

I have a frozen target benefit plan that got several checks from the Nasdaq settlement. Can the company cash these checks and pay plan fees or must they be allocated as earnings?

Thanks

A married participant has a sex change operation (male to female) but remains married to his (now her) wife. How are they to be treated during a new enrollment period? A same sex couple, which would seem appropriate due to new/different health risks and possible expenses? Are they "grandfathered" into the plan or under law as a heterosexual couple since they were married at the time of operation?

I work for a Multinational Company in Sales and have done so for the same company for 5+ years. In 2000, I finished the year as the #1 Salesperson in my region of the country and for this accomplishment, I am supposed to win a trip to Cabo San Lucas, Mexico. But, I am leaving the company and now they are denying me this reward that I justly won. They are paying me my 4th quarter commission and my year-end bonus that I earned, but they will not give me this trip. I see this as some type of violation of the law because there are no stipulations in the contest rules which state their position that since I'm leaving the company, I can not claim this reward. Any thoughts for me??? Thanks!!!

What criteria must a closely held, foreign owned company meet in order to comply with the definition of qualifying employer security for a 401(k) plan (a domestic plan with a foreign parent company).

Please supply source of information provided.

If a son has the limited power of attorney (to control the asset allocation) on his father's IRA is it a prohibited transaction (PT) if:

a. son receives no compensation for his investment advice.

b. son receives compensation from non-IRA assets

c. son receives compensation from IRA assets

Assume that:

1. Son only has the power to direct an independent custodian (mutual fund, brokerage house etc) as to the IRA's asset allocation.

2. Son has no other interest in the IRA except that he is one of the bene's on the IRA.

3. Compensation was reasonable.(And then we could talk about what reasonable means)

I received a non-binding research opinion from the Service that said that (a) and (B) were not PT's but that © was a PT. The logic the IRS rep. used was that a PT can only occur between a "plan and the disqualified person". Since in (B) the fee was paid from non-plan assets that makes it OK. Since © came from the "plan" it would be considered "self-dealing" in this case.

I'd be curious as to the thoughts/analysis of the group. I have some concerns that even (B) could be a PT given the scope of IRC 4975©(1)(F) even with the "reasonable compensation for services rendered" exemption in 4975(d)(10).

Thanks.

My husband works for a large company and for many years has had a percentage of his pay deducted to pay for stock in the company. He is considering early retirement, age 56. We have been told that we can roll the stock over to a plan under 72t for five years and be paid a certain interest rate on this money, and that we won't have to pay any capital gains tax at time of roll over. I'm having trouble verifying this. Can you be of help or direct me to where I can get accurate information.

Has any Quantech/Oracle user upgraded to a new db server without sending the new server to Corbel or having Corbel tech come to your office?

What is the recommended procedure when the Employer fails to deduct loan payments from the participants' paychecks and doesn't discover the omission until the allowable grace period has elapsed?

We have a participant in our plan who has achieved normal retirment age. She has elected to take her account balance out. She has requested 10 year averaging. She meets the age requirement for 10 year averaging, but since she is still employed she will continue to receive annual profit sharing contributions. To qualify for 10 year averaging must the distribution be her total account balance. In her case it will not be her total account balance because we continue to allocate contributions to her account. Our question is whether she qualifies for 10 year averaging or not?

What are (if there are any?) the State Law requirements in New York for continuation of health coverage- some materials I have indicate that there is a "mini-cobra" law in New York. Does anyone know? Do you have citations?

Thank you

A retiree receiving a disability pension under a governmental defined benefit plan died with a balance. This person was divorced and had designated a parent as a beneficiary in writing. The plan does not specifically discuss the designation of a beneficary by a disability retiree but the practice has been for beneficiaries to be named by disability retirees and balances remaining have been paid to the designated beneficiary. My question is whether the balance should be paid to the estate or to the named beneficiary.

Do an owner's deferrals have to be considered when calculating the 5330 penalty for untimely deposit of employee deferrals?

Can a pregancy be considered a pre ex under HIPAA?

I have an employee of a small group (8 employees) that originally refused coverage at the open enrollment date (in April). She is now pregnant and wants to buy into the coverage.