The outcome of Arizona v Norris resulted in the requirement of using the same mortality tables for males and females for determining act equiv. benefits.

Is there a section in Code that requires use of same mort. table or is this requirement just based on Civil Rights established from the case?

A Plan doc has Gatt assumptions for lump sums, but the most up to date SPD has PBGC basis. How likely of a case does an employee have in this case and does anyone know any precedents out there?

The ee wants PBGC basis as it results in greater lump sum.

The 83 GAM is used for GATT purposes and is considered a current mortality table. Does anyone know how to explain to a client why this table is considered current if it has the year 1983?

Does anybody know of a VEBA sponsor located in California?

Thanks

Can a company contribute, as a corporate contribution to the company's qualified profit sharing plan, the stock of a publicly traded company (not related). The corporation owns the stock and they want to "transfer" it to the plan as a company contribution. They would record it on the corporate books at the market value on the date of transfer, realizing any gain/loss for tax purposes. The company wants to avoid the transaction costs of selling the stock and buying it again for the pension trust.

What recourse does a self-funded group health plan have in the case of a member who did not disclose a serious health condition upon enrollment? Could they apply a 12-month pre-ex condition exclusion retroactively? Could they deny all claims based on the member's failure to disclose?

Can anyone advise me on the possible ramifications of a self-funded group health plan denying a member entry into the plan's coverage because of an ongoing illness? Would it make any difference if it was a new hire vs. an existing employee? I am not sure what regulations apply.

When a shareholder sells his stock to the ESOP and elects the 1042 tax treatment, can he also participate in the ESOP shares at a later time?

I have a takeover client that previously adopted a Volume Submitter document circa 1992. IRS auditor is asking for amendments required under UCA '92 and OBRA '94.

Even though he's now with me, isn't his document still maintained by the former TPA, who would have added these amendments to the Volume Submitter document?

Opinions? To my knowledge, client was never sent an "I'm giving you the boot" letter.

I have always considered it a given that nonqualified elective deferrals can not be included in the definition of compensation for allocation purposes in a qualified plan. These deferrals would not technically be employee compensation. They would be employer contributions to the NQDCP on the employee's behalf.

Of course, a client has told me there is new legislation or case law that changes this result and allows nonqualified deferrals. I don't know of any such new law.

But it occurred to me to ask the following question: Does anyone permit the inclusion of NQDCP elective deferrals in the definition of compensation for allocation purposes, and then test for discrimination under the compensation ratio test? If the employee population is large enough, and the top hat group small enough, presumably you could have a small enough difference in the ratios to be de minimis.

Again, however, since these deferrals are employer contributions to the NQDCP, and not employee compensation, my understanding is that this is not permissible at all.

thanks.

card

Does anyone know of any debtor/creditor laws in Massachusetts that would require any special consideration when drafting a rabbi trust in that state?

Thanks.

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I have a client (a small independent nation loosly affiliated with the US) who is establishing a new defined benefit plan (for its government employees). The client wants to allow up to two years of service with any branch of the US military to count toward vesting service but not benefit service.

The client is concerned that somehow this might jepordize or at least reduce any US military pension a member might be entitled to.

I have told them this is not a concern regarding vesting service.

Is there any circumstance where crediting service with the US military in a non-military defined benefit plan could cause problems with a military pension?

Thanks,

Mike

The following question was addressed to the Plan Design Q&A column. I referred the questioner to the materials from the recent ASPA conference for details about the mechanics of this issue, but I think that discussion by practitioners who have used this method, or who have chosen not to, would be valuable to both the questioner and many others. Any comments?

Recently, I read about the so-called "flip-flop" method of taking deductions for corporations sponsoring both a DB plan and a DC plan (see the details in the DATAIR Winter 2000 news letter). Under this method, a business owner may contribute 30K to a MP plan each year and the full amount to a DB plan each year, and deduct both contributions and still comply with 404(a)(7). The deductions are taken not

in the same year for both plans, but 2 years of 30K DC contributions are deducted in one year, and 2 years of DB contributions are deducted in the following year, and so on. The timing of the contributions must be carefully laid out and followed. I have never heard of this method before,

and would like some comment from other practitioners. It would obviously be very valuable to some high-income small business owners.

We have a cafeteria plan that offers several HMOs, a POS, a PPO and a Catastrophic (Cat) plan. Employees choose the Cat plan if they have other coverage. If an employee with a Cat plan has a life status change, we permit the employee to change from single to family or family to single. We do not permit a change to one of the other plans until Annual Enrollment (per our understanding of the Cafeteria rules pertaining to life status changes). Does HIPAA supercede this and permit a change in plans? We would like to permit this if we can support this with a cite.

Our firm has been involved with a PBGC audit of a terminated plan for over a year.

We have to pay out some additional funds due to changes in interest rates.

Plan has been terminated, all accounts closed, some of the participants are not employees.

How do the people get paid if there are no more plan accounts? From the corporation as non employee compensation, and then given a 1099 MISC??

It seems ludicrous to open up plan accounts when the plan has been closed for almost 2 years.

I asked the auditor who told me "it is a legal question, and I do not have the answer."

How are corrective distributions treated for top-heavy determination purposes? Are they treated like any other distribution? Does it make any difference if the corrective distribution is for excess contributions, excess aggregate contributions, excess deferrals, or 415 excesses?

A Company starts a 401(k)Plan 8/1/00. However, (either intentionally or unintentionally), their is no provision for an initial short plan year. Plan year is defined in the document as 1/1 - 12/31. References to compensation include periods prior to 8/1/00.

Does this mean that all eligible employees became participants on 8/1/00 or 1/1/00? Should the 2000 5500 indicate a 1/1/00 Plan effective date?

Thanks for any comments.

Can a company adopt a 401(k) plan in December to be effective retroactively to the beginning of the calendar year and take advantage of the first plan year adp non-highly compensated 3% deferral rate for testing?

In a situation where there is a short initial plan-year running from 7/1/2000 - 12/31/2000, is the deductibilty limit under Section 404 based on the full-year compensation or only the compensation for half of the year? Thanks.

I have a client that is having trouble access the web module using Netscape. Has anyone else had this problem?