A client calls me up and says that the 401(k) plan has to contain domestic partner benefit provisions to qualify for a city contract. What can he be talking about?

Only employees can defer....

Spouses have beneficiary rights....

Can the plan require that a person name his/her domestic partner as primary beneficiary?

any other ways that DP can be referenced?

Thanks

Correct me if I am wrong: My understanding is that if an employer has less than 20 employees he is not required to offer COBRA and if he has less than 50 employees he is not required to follow the FMLA rules. My question is this: Does this employer's 125 Plan Document and Summary Plan Description need to have the COBRA and FMLA language in it?

Or can the plan be amended if and when the employee count reaches 20 for COBRA and 50 for FMLA? Thanks for your help.

Is it possible to acquire a grandfathered SARSEP through the purchase of the business that sponsored it? Does it matter if the purchase is of stock, assets, or just purchase of a professional practice? Does acquisition of the SARSEP have to be express in order for it to survive the acquisition?

We have a client who recently terminated his Simple Plan. The funds were invested in a life insurance annuity, and all participants except one chose to leave their account balances with the insurance company. The lone participant who asked for a taxable distribution was paid out.

Now we are working on their corporate tax return and find that the employer still owes some match contributions to the Simple Plan. The insurance company refuses to take the match contribution for the employee who took a taxable distribution since her account balance has been paid out and the plan was terminated. What is the proper way to get this match contribution paid out as a taxable distribution to the employee?

Assuming a Section 125 plan is established mid-year and that the plan has two components: medical reimbursement and dependent care

1. Are the maximum contribution limits prorated for the short plan year? I.E., is the $5,000 maximum dependent care contribution prorated or can the full $5,000 be put into the plan?

2. I believe there is a "use it or lose it" policy which has an element of risk for the employer and the employee. Does this element of risk apply to both components? Can the employer chose to accept the risk for only one portion, say the medical reimbursement portion, while mandating that the employee only submit dependent care bills up to the amount he has contributed?

Cites would be appreciated.

Thanks.

I want to read a summary explanation of the major provisions contained the Comprehensive Pension Reform Bill, (I think it's H.R. 4843) under consideration by the Congress. Anybody know a nonproprietary source I can go to for this information.

The IRS has issued guidance re: direct rollovers of account balances containing loan notes and have said that the loan will not be treated as a taxable distribution if the note is included in the rollover, the borrower acknowledges the change in obligee, and the receiving plan accepts loans.

Question: Is there similar guidance in the case of a trust to trust transfer (no distributions permitted due to our beloved same desk rule) or a plan merger?

Thanks.

An employer is looking to establish a group IRA plan under Code Section 408©. Does anyone know of an institution that is willing and able to act as trustee/custodian under such an arrangement? Preferrably located in the New York area, and with a prototype trust agreement, but any information is welcomed.

Thank you.

A participant has $2,000 in deferral account and $1,000 in matching account. He is 20% vested in match. If the plan's loan policy allows the participant to choose from what source the loan will come from, can the participant have a $1,000 loan come from the match source only? If the participant terminates and defaults on the loan, the plan can forclose on the deferral account to restore the unvested portion of the match account that was loaned to the participant.

From the Green Party:

"Currently, we are the only industrialized country without a national health care system. Unfortunately we have a private insurance system that insures only the healthiest people, systematically denying coverage to individuals with 'pre-existing' conditions and routinely terminating coverage to those who become ill."

(More: http://www.benefitslink.com/links/20000714...14-006198.shtml)

In your opinion, what's wrong with their position?

Partially vested participant in a DC Plan with three years of service terminates employment in 1992 and is "cashed out" because his benefit is less than $3,500.

Former participant is rehired in 2000. It would appear that he would be ineligible for restoration of forfeitures through a "buy-back", but should he be immediately eligible for participation under 410(a)(5)?

A Morningstar employee has written an article that criticizes the practice:

http://www.benefitslink.com/links/20000714...14-006190.shtml

Do you agree?

Does anybody know what would be the right order to correct when a participant violates more than one limit?

Say for example Mr. X violates the salary deferral limit and defers 17% whereas adoption agreement puts the limit of 15%. Mr X. also violates the 402(g) limit by $500 and also fails the 415 limit.

In such a case what would be the steps for correction before running the ADP/ACP test.

I'm not following how the calculation of profit sharing contributions work for a sole proprietorship with employees when an employer specifies that he or she wants a specific $ amount to be allocated. The doc provides a prorata formula. How do you derive the earned income for the employer if depends on how much is allocated to the employees? Can you give an example?

Thanks

An employee terminates service say 6/1/2000. He intends to receive a lump sum, but has discovered that in his opinion the lump sum payable is several thousand dollars lower than he feels it should be. What are his options (or best options)? Should he try and correct error prior to distribution or is it best to take distribution and then file a claim for additional benefits? Interested in hearing strategies as well as any legal aspects and citings.

Can anyone direct me to regulations, advisory opinions or specific information as to whether or not a non-fiduciary (directed recordkeeper/silent Trustee) can retain "float" interest on disbursement accounts (General Accounts) maintained for a qualified Plan? I have read through A.O. 93-24A (1994), but I cannot locate any other specific rulings or information. If allowed, would the non-fidiciary simply have to pass notice (disclosue) to the Plan Trustees (Fiduciaries)? Thank you in advance for any comments or suggestions.

A new PSP was established for the 1999 tax year. Yesterday the sponsor decided that he will be unable to fund for 1999. Am I still required to file a 5500?

There are 81 eligible employees. If I file I guess I would show 81 participants, none with account balances, and $0.00 assets at year end.

Seems like I remember that the plan and trust are not really established until a contribution is made.

Any comments appreciated

I was employed by a Catholic Diocese for the 1999-2000 school year. I am still receiving paychecks for that position. I just accepted a teaching position in a public school system for the next school year. The Diocese has cancelled my health insurance and offered me Cobra. Two questions: Is it legal for them to cancel my health coverage if I'm still getting paid? Can I opt out of getting Cobra now, but if I end up having to go to the doctor buy it and have it be retroactive - I believe I have 60 days to do this according to Cobra law, which would put me up to my new coverage.

A company sponsors a money purchase pension plan that, once eligibility has been met and a participant begins participation, requires 501 hours of service to receive an allocation of the contribution for the plan year. The company has decided, near the end of the plan year, that they don't want to make contributions to employees who terminated during the year so they amend their plan to require employement on the last day requirement as a requirement to receive a contribution allocation.

Some of the terminees worked the 501 hours and when they left were expecting a contribution. Now they won't get one. Is this a cut-back of benefits?

A check representing a monthly payment on a note owned by a qualified plan is mis-deposited in the community property checking account of the individual whose professional corporation sponsors the plan, and his former spouse (who is an alternate payee under a QDRO). Is there any problem with simply disgorging the money and writing a new check to the plan from the community account? Would failure to disgorge (i.e., participant writes a separate check to the plan from another account) be a prohibited transaction?