Is this a mistake on the form? For a Profit Sharing plan you need to indicate the payor ID# in box 2. Right under box two it says skip line 3. But the instructions seem to indicate you DO fill in the number paid?

Are you putting in the number on line 3 or leaving it blank. THANKS!

Plan has safe harbor hardship withdrawal language. Issue: participant who desires hardship withdrawal has vested but unexercised stock options. Options are currently above water, and participant may take advantage of cashless exercise. Administrator's question: Does Reg. 1.401k-1(d)(2)(iv)(B) mean that the administrator must require the participant exercise his vested options (using the cashless exercise process, not cash) before the participant qualifies for a hardship distribution?

Has anyone encountered this situation before? If so, what did your plan administrator do?

I'm conservative and feel that the participant must be able to revoke his consent prior to the payment and I feel the amount should be on the form. However, we have a client that wants the consent to be irrevocable and does not want to have to enter the amount. They say the participant can look on the prior statement.

Are there some cites out there that specifically address this? The regs say the form must explain the "relative values" of optional forms of distribution. Anything else? I'm also particularly interested in the "irrevocable" aspect the client desires.

Thanks.

Two questions regarding hardship withdrawals under the safe harbor withdrawal provisions.

One: Can the administrator, in his sole discretion allow a hardship withdrawal without requiring the participant to first exhaust his plan loan options? Any precedent?

Two: If the plan forgot to stop employee voluntary payroll deductions when the hardship check was issued how should this be rectified? The participant received the distribution in December 1999, the end of the 99 plan year, and is still contributing. Can we stop contributions now and start the 12-month period? Any precedent?

Does anyone know the status of this aspect of HIPPA? As I recall, some members of Congress have been delaying funding for any system of National identification of individuals.

If the assets of a defined benefit plan exceed the liabilities, can one freeze the plan and take the excess as seed capital for an ESOP ?

What software are you using? From your description, I believe that you are looking at the other "bar code" that imbeds the English answers into code, which the IRS computer can scan and input. Based on a seminar I attended, that code is called "Computer scannable 2D bar codes".

Just wondering if anyone has experience with putting together a FAS87 report for a SERP & if they could suggest some reading material ?

Just wondering if anyone has experience with putting together a FAS87 report for a SERP & if they could suggest some reading material ?

Self-insured med/dental plan where my organization serves as sponsor, administrator, and fiduciary. Other smaller organization has been in the plan for several years. We have the same outside council and some of the same companies are represented on both boards. We are being told that having these common board member companies puts us under "common control" and therefore not a MEWA. I don't read the PWBA booklet this way. I have just read the third installment of Q's and A's and note that Q 20 does address "a common control interest of at least 25 percent at any time during the plan year." Any clarification or further source of info would be much appreciated.

DB termination under standard provisions. Participant could not be located and was handled under the PBGC Missing Participant program. Now, as we are allocating excess assets, he shows up. My review of the MP instructions is that the Plan *can* send the allocation of excess to PBGC, but I do not see any requirement to do so. My opinion is that we should pay the excess directly to participant (with properly executed form) since that is much simpler and avoids having the PBGC track down 2 payments.

Any comments?

Self-insured med/dental plan where my organization serves as sponsor, administrator, and fiduciary. Other smaller organization has been in the plan for several years. We have the same outside council and some of the same companies are represented on both boards. We are being told that having these common board member companies puts us under "common control" and therefore not a MEWA. I don't read the PWBA booklet this way. I have just read the third installment of Q's and A's and note that Q 20 does address "a common control interest of at least 25 percent at any time during the plan year." Any clarification or further source of info would be much appreciated.

The scope of health care products now available through coalitions and their group

purchasing efforts is rapidly expanding.

The Heartland Healthcare Coalition is typical in that both regional and national health care products can now be accessed by

members. Direct contracts with hospitals and physicians, physical therapy rehab.networks, HMO's, and EIP programs are some of the standard regional products now available. PBM options, PPO networks, dental plans, Lab services, Third Party Administrators, and Centers of Excellence reflect some of the national products.

For the future, look for more nationally-negotiatied products through organizations like the National Business Coalition on Health, including internet-driven programs to encourage self-care and expand the scope of knowledge in area's like disease state management.

Jerry Custer

An employee has terminated mid year. How long must the cobra extension be for the cafeteria plan? The employee also has a 1 year severance package, can this individual elect pre tax benefits until the 1 year runs out?

In practice, do qualified pension plans covering clergy designate a portion of benefits as a housing allowance under Code Section 107? Rev. Rul. 75-22 is favorable but doesn't deal specifically with a qualified plan. The IRS won't rule on the issue. What do your clients do?

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Patrick J. Foley

Foley & Foley

415-399-0907

pjfoley@foleyfoleylaw.com

Client has compensation greater than $200K as non-owner/employee of big corp and defers $10,500 to 401(k) plus a small matching contribution. This person also has consulting business with income of $200K, and wants to set up SEP or perhaps DC or DB Plan. Does he get the full 415 limit for this new Plan, despite participation in the 401(k) Plan?

An ESOP holds 90% of an employer's stock. 20 employees then own .5% each. In such a situation would the only key employees be the officers and there could be no key employees based on 5% ownership, 1% ownership or top ten owners?

I know in certain instances under the 1.1563 regs you ignore stock held by ESOPs or employer plans in determinng ownership, but I could find no such provisions in 318 or the 318 regs.

An employee reaches normal retirement age, retires, and takes a lump sum distribution. The employee had previously been offered diversification at the applicable time.

The employee is now rehired. Is he automatically entitled to diversification? Plan provides diversification upon attaiment of age 55 and 10 "Years of Service".

If an employee is terminated prior to the end of a plan year, and has funds left in their flexible spending account, can they continue to use it through the remainder of the year even though they're not an employee any longer?

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Can an individual contribute to more than one Roth IRA account during the same year?