I am working on a takeover plan and am trying to find out if the Plan, which was adopted 11/21/94,was ever submitted for a Determination Letter. Years ago, I had a contact at IRS who would locate the latest DL and FAX it to me, but he is no longer available. I am hoping that someone has a contact at the IRS for this purpose. Thanks for all input.

What is the prevailing approach for distributions when a DC plan is terminated with favorable determination letter, all searches, IRS & SSA letter forwarding requests completed without the participant being found? I'd like some feedback from practitioners on whether the preferred approach is to use the forfeiture approach approved by the regulations (although the regs appear to specify that the participants be 65) or to try the 100% withholding option? Does the approach vary depending on whether the account balance is greater or less than $5,000?

Can a non-spousal beneficiary simply maintain the inherited IRA in the name of the decedent without taking a distribution thereby avoiding a taxable event? I believe the answer is Yes, just hoping for some verification.

I have a resident alien participant in an ERISA plan that died intestate. He was married and divorced twice. The beneficiary designation that we have is for the second wife while he's married. On that designation he selects his son from the previous marriage as the beneficiary but new wife does not consent. Neither divorce settlements provide for any plan benefits and the plan document says to pay to spouse if married or other beneficiary if spouse consents. Is the beneficiary designation denoting the son as beneficiary a valid designation now that they are divorced or does it remain invalid since it was invalid at signing? We know that it wasn't valid at time. Can we pay the balance to the estate of the individual? Any insight for the 7th circuit on court cases would be great.

If a participant completes all the paperwork to receive a distribution such that he/she elects a specific form of beneift (single sum, installments, etc.), tax withholding, and whether to make a direct rollover, what options does the plan sponsor have if the participant receives another contribution at the end of the year? Can the plan sponsor rely on the written election that pertain to the previous distribution even if those signatures and elections are more than 90 days old?

Retired employee dies at age 75. He did not take his required minimum distribution for 2000 at time of his death. Designated beneficiary is charitable trust. Must the RMD be made and if so, is it made to his estate or to his designated beneficiary?

A Plan requires that a lump sum be computed as the sum of 50% of the value using PBGC male mortality and 50% of value using PBGC female mortality.

What is 50% PBGC male mortality? ERISA 4044 has two tables. Table I is mortality for healthy males (same Table I w/ 6 yr set back is female table). And Table 3 is entitled "lump sum mortality table*, which may be a table that blends male and female rates from some mortality table.

If my memory is correct, Table I is the GAM 71 male and female tables. And Table 3 may be related to the UP84 Table.

Like to know your thoughts.

Gary

The plan provides that union employees are eligible to make elective deferrals, but are not eligible to receive a matching contribution. For purposes of the 3% 401(k) safe harbor contributions, it seems to me that since they are eligible to defer, the union employees should receive the 3%. Is this correct? The fact that they are excluded from the regular 401(k) testing, however, causes me to reconsider the requirement for them to receive the 3%.

Mary Kay ,

Thank you very much for your reply. I wonder if you could clarify a couple of points:

1. If the basis of the employee's contributions is not reporetd on the form, is it at all possible to figure it out so the benefit isn't lost?

2. Not sure how you got $20K cost & $80K NUA in the example - my example included $100K basis and a

$400K NUA ($500K total value of 401K), in which case,

I understand, the $100K is originally taxed as ordinary income and then recoverd upon the stock sale and the $400K is taxed at 20% LTCG rate.

Thanks again for your great help.

Are there any advantages to using a grantor trust rather than a VEBA for a self-insured health plan with "church plan" status that provides benefits to employees of multiple affiliated organizations?

some additional comments on 6.0:

if you are holding forfeitures in suspense, and in particular, in the 'FORFEITURE' account (rather than to the account where forfeited), you will have to have a fund name 'FORFEITURE', fundid = FORFEIT for the values from suspense to print on the summary of accounts report. make it a cash account.

(This is added to the investment fund table, not plan specs)

if you are making changes to census items, you have to hop off the last field you edited before going to another employee. otherwise the changes won't take place. in the past, I don't recall this being 100% necessary.

(There are further 6.0 notes in an earlier message if this is the first 6.0 comments you have looked at)

Has anyone heard anything (perhaps at the ASPA conference)about possible changes, new questions, etc. for the 2000 Form 5500 and schedules?

John Hancock

Is anyone offering a legal services plan to their employees? What features do you look for in a plan? How do you choose between plan administrators?

Thanks.

Dan

Under the family status change rules, can an employee who currently waives coverage enroll in the plan?

Plan A is being merged into Plan B at the end of calendar year 2000. Plan A's loan policy provides that participants may continue repaying loans after terminating employment or retiring by bank draft. Plan B's loan policy requires full repayment within 60 days after termination or retirement. Can participants with outstanding Plan B loans be required to repay the loan balance at termination of employment or retirement?

Company has 2 NHCEs who are husband and wife. Both are 3% owners. When family attribution rules are applied, do both husband and wife become > 5% owners, thus making them HCEs by ownership?

Under IRS Notice 97-11 "Sample Lnaguage for a QDRO" under the Appendix to 97-11, Part I, Section D(1)(B) "Comencement of Benefit Payments to Alternate Payee," the DoL states that a retirement plan "...may (but is not required to) allow payments to begin to an alternate payee at a date before the earliest retirement date." IRS Section 414(p)(4) states that no distribution can be made before the earliest retiremenet age. If the Plan does not permit a participant to receive distribution before age 55, then the earliest retirement date is the date that the participant 1) actually retires or 2) reaches age 50. Can you add a provision to a plan, as the IRS Notice states that says "Regardless of whether the participant is entitled to receive a distribution, an alternate payee is entitled to a distribution at any time, even before the earliest retirement date."?

Need help with the following detaails:

As far as the NUA in the employer's stock lump-sum

distributions:

1. are the employee's contributions covered as

well as those of the employer?

2. for example, if the lump-sum is $500,000 and

trusee's cost is $100,000, & $400,000 of Net Unrealized Appreciation (NUA) :

a) what are tax reporting procedures of the

future share sales (which will qulify for

a 20% cap. gain rates) :

i) is the first $100,000 of sales tax

free? (since it was included in your

ordinary income upon the distribution)

ii) what's the basis of the next, let's say

$200,000 - is it zero?

iii) what back-up is reqired to be filed

with and/or retained for the tax

reporting purposes?

iv) can the future sales of the NUA balance

be offset with the capital loss

carryovers from the prior years (which, I understand, can be carried forward indefinetely, until fully used-up or the taxpayer's death)

b) can the first $100,000 (the trustee's cost)

be definetely tranferred to an IRA ?

Appreciate any info .

We are in the process of upgrading to 6.0. It looks like things are running pretty smooth for most of you.

Do any of you use the Trust Accounting package Quantech has added to 6.0 and if so, how is it working?

What recommendations can you make? Thanks.