In the Los Angeles Times "Parade" section on October 22, 2000 is an article entitled "Is the Roth Ira for you?" -- In the last paragraph, it states, "Consider opening a Roth IRA as a gift to your children."

Can this be done even without earned income? I like to open one for them by giving them a gift.

Also, what about from the money earned as dividends from their stock portfolios?

I WOULD LIKE TO INVEST IN A ROTH IRA. I AM PRESENTLY INVESTING 20% OF MY INCOME IN A REGULAR IRA THROUGH COMPANY PAYROLL DEDUCTIONS. WILL THIS CONFLICT BY HAVING TWO IRAS? ALSO MY SPOUSE WHO IS 65 AND RETIRED WOULD LIKE TO INVEST IN A ROTH IRA WITH ME. IS THIS POSSIBLE?

THANKS, FRANK

I was named beneficiary of my ex-husbands 401k plan. He worked at this company while we were married, and left them before we divorced, retaining his 401k plan with them. We agreed to leave me as beneficiary mainly because we have children, I in turn left some of my policies in his name.

He passed away last year and I could find no paper work to contact this company, until they mailed me last month. I promptly called them and was told I was still beneficiary of his 401k. I was asked to supply several pieces of information to verify all this. When I informed them we had divorced the lady became very curt and stated simply that I was entitled to nothing because we had divorced. I explained that we had not known that a divorce would affect this or we certainly would have not left it this way. She said she could not help me, that she was following federal guidelines that stated I received nothing if we were not legally married at the time of his death. She then asked me to obtain and send her a copy of his death certificate so she could close out his account with the company and that the company would absorb all funds from this account. I asked for the policy and the federal guidelines that she said she must follow to be sent to me and she said she could not do that. I am now at a loss as to what to do. If I have no rights to the funds, so be it, but don't I at least deserve to see the paperwork? She also said I may need to sign a paper stating I am not entitled to anything. I have looked for information on this and can find nothing really helpful. My ex-husband was only 35, so he did not reach retirement age, is this the reasoning behind no benefits? Can someone enlighten me on this subject and possibly where to find these federal regulations she spoke of? I tried to get answers from her but she said she could tell me nothing more, once she confirmed I was divorced, even with me named as his beneficiary. Thanks so much.

In a money purchase ESOP plan about 15% of the assets of the plan are currently in the money purchase source. The MP source includes both employer stock and other investments. The ESOP loan has been paid, so there is no leveraged stock in the plan at this time.

An employee is eligible to make a diversification election for 25% of the employer stock in his account.

How do I determine what source to take that diversification election from? Pro-rata? Money purchase first? Money purchase last?

The employee has the option of taking a cash distribution or transferring to the employer's employee directed 401(k) plan. The plan does not specify any other options for divesification. Should it include an annuity option? Otherwise, without spousal consent, can the participant elect to diversify the MP portion?

If the transfer to the 401(k) plan includes assets from the MP source, does the 401(k) plan have to track it as MP source or something else, like rollover? If MP assets are transferred to the 401(k), does the spouse have to sign a J & S waiver? I would think so, unless the 401(k) plan tracks the transfer as MP source.

when a beneficiary inherits a roth IRA, does that indiv have to take MRD's over their lifetime or could they continue to let grow tax-deferred during their lifetime and pass on to a future generation?

Is the deadline for 2000 roth contributions 4/15/01 or 12/31/00?

i am about to change jobs, and i just want to make sure i am able to roll my 401k into my roth ira.

are there any conditions or restrictions i need to worry about. i don't make 100k/yr.

Presume a SARSEP fails the 50% minimum participation test two years in a row - 1999 and 2000. Upon discovery of the problem late in 2000, all deferrals are stopped. If I understand correctly, presuming timely notification to employees, and timely withdrawal of disallowed deferrals, the only tax consequences of unwinding are the additional income tax to employees - and, I am guessing, the additional employment taxes the employer must pay on the re-included income. But for the prior year, the employees must ALSO potentially pay excise taxes on disallowed deferrals and earnings under IRC Secs. 4973 and 72(t), respectively, and the employer must potentially pay a 10% excise tax for untimely notification of excess SEP contributions. Is that correct? And, in either year the SARSEP failed the 50% test, can the employees "keep back" $2,000 as a deductible IRA contribution for each year, or must all deferrals be withdrawn?

Is there any regulation regarding the plan posting

the funds sent by the employer to an employee's account?

Does your monitor seem to give you headaches? Are you using Windows?

I've seen a lot of folks who are working on monitors that "flicker," causing eyestrain and headaches, especially when the monitor is in a room that's illuminated by flourescent lights.

Often a quick and easy solution is to change the "refresh rate," which is a setting in the "Display" program that's part of the "Control Panel" in Windows. On my Windows 98, you'd click Start -> Settings -> Control Panels -> Display (double click) -> Settings (a tab) -> click Advanced button -> look for an Adapter tab -> look for a Refresh Rate setting.

Try setting the Refresh Rate to the highest value in that list -- 85 Hz or 75 Hz, for example. And try "Optimal" and "Adapter Default." Windows 98 lets you preview how the monitor will look under the new setting, so you can go back to the current setting easily if the new setting is no better or causes the monitor to act strangely.

Sometimes the difference is truly amazing. While visiting my accountant's office I made the change for their receptionist, who now thinks I walk on water

The employer wants to base profit sharing plan contributions on the following: $150/month for each employee with perfect attendance, $150/month for each employee with no accidents, $200/month for each employee based on some production goal for the company as a whole. No HCEs will benefit under this plan.

I haven't worked out all of the language yet, but wanted to know if anyone saw anything wrong with the basic concept of this just on the surface.

Also, the ER wants to base these incentives on monthly goals (perfect attendance for the month, etc), but still wants a last day/1000 hr rule. My concern is that if the plan specifically allocates on a monthly basis, how can we have last day/1000 hr requirements?

Am I correct that an employee can defer under both a 401(k) plan and a non-model (prototype) SARSEP plan of the same employer provided that the 402(g) limit is not exceeded when deferrals from both plans are combined?

Can an employer that maintains n IRS model SARSEP also maintain a qualified plan if each plan covers separate groups of employees (no overlap)?

Do all cafeteria plans need to be amended by December 31, 2000 including those that are premium only plans? Or is the amendment only required for accident and health which cover medical expenses?

[Reprinted below is a story posted anonymously on the Web.]

Many years ago, when I worked as a volunteer at a hospital, I got to know a little girl named Liz who was suffering from a rare and serious disease. Her only chance of recovery appeared to be a blood transfusion from her 5 year old brother, who had miraculously survived the same disease and had developed the antibodies needed to combat the illness.

The doctor explained the situation to her little brother, and asked the little boy if he would be willing to give his blood to his sister. I saw him hesitate for only a moment before taking a deep breath and saying, "Yes, I'll do it if it will save her."

As the transfusion progressed, he lay in bed next to his sister and smiled, as we all did, seeing the color returning to her cheeks.

Then his face grew pale and his smile faded. He looked up at the doctor and asked with a trembling voice, "Will I start to die right away?"

Being young, the little boy had misunderstood the doctor; he thought he was going to have to give his sister all of his blood in order to save her.

You see, after all, understanding and attitude are everything.

[Reprinted below is a story posted anonymously on the Web.]

In ancient times, a king had a boulder placed on a roadway. Then he hid himself and watched to see if anyone would remove the huge rock. Some of the king's wealthiest merchants and courtiers came by and simply walked around it. Many loudly blamed the king for not keeping the roads clear, but none did anything about getting the stone out of the way.

Then a peasant came along carrying a load of vegetables. Upon approaching the boulder, the peasant laid down his burden and tried to move the stone to the side of the road. After much pushing and straining, he finally succeeded.

After the peasant picked up his load of vegetables, he noticed a purse lying in the road where the boulder had been. The purse contained many gold coins and a note from the king indicating that the gold was for the person who removed the boulder from the roadway.

The peasant learned what many of us never understand. Every obstacle presents an opportunity to improve our condition.

[Reprinted below is a story posted anonymously on the Web.]

In the days when an ice cream sundae cost much less, a 10 year old boy entered a hotel coffee shop and sat at a table. A waitress put a glass of water in front of him.

"How much is an ice cream sundae?" he asked.

"Fifty cents," replied the waitress.

The little boy pulled his hand out of his pocket and studied the coins in it. "Well, how much is a plain dish of ice cream?" he inquired. By now more people were waiting for a table and the waitress was growing impatient. "Thirty-five cents," she brusquely replied.

The little boy again counted his coins. "I'll have the plain ice cream," he said. The waitress brought the ice cream, put the bill on the table and walked away.

The boy finished the ice cream, paid the cashier and left. When the waitress came back, she began to cry as she wiped down the table. There, placed neatly beside the empty dish, were two nickels and five pennies. You see, he couldn't have the sundae, because he had to have enough left to leave her a tip.

[Reprinted below is a story posted anonymously on the Web.]

One night, at 11:30 PM, an older African American woman was standing on the side of an Alabama highway trying to endure a lashing rain storm. Her car had broken down and she desperately needed a ride. Soaking wet, she decided to flag down the next car. A young white man stopped to help her, generally unheard of in those conflict filled 1960s. The man took her to safety, helped her get assistance and put her into a taxi cab. She seemed to be in a big hurry, but wrote down his address and thanked him.

Seven days went by and a knock came on the man's door. To his surprise, a giant console color TV was delivered to his home. A special note was attached. It read: "Thank you so much for assisting me on the highway the other night. The rain drenched not only my clothes, but also my spirits. Then you came along. Because of you, I was able to make it to my dying husband's bedside just before he passed away. God bless you for helping me and unselfishly serving others."

Sincerely,

Mrs. Nat King Cole.

[Reprinted below is a story posted anonymously on the Web.]

During my second month of nursing school, our professor gave us a pop quiz. I was a conscientious student and had breezed through the questions, until I read the last one: "What is the first name of the woman who cleans the school?"

Surely this was some kind of joke. I had seen the cleaning woman several times. She was tall, dark-haired and in her 50s, but how would I know her name? I handed in my paper, leaving the last question blank.

Just before class ended, one student asked if the last question would count toward our quiz grade. "Absolutely," said the professor. "In your careers, you will meet many people. All are significant. They deserve your attention and care, even if all you do is smile and say 'hello'."

"I've never forgotten that lesson. I also learned her name was Dorothy.

My wife and I have 401k's file jointly and have agi less then $100k. I understand I'm not eligible for a traditional IRA but am for a Roth. Assuming this is true I have the following questions

1. how much $$ to start a Roth?

2. Am I limited to one fund?

3. Or Can I est. a Roth as a stock portfolio that would contain the stocks I pick and choose as I find and buy them?

Has anyone figured out whether the $6000 deferral limit to SIMPLE IRAs will increase for 2001?

Has anyone seen a discussion on the PLR 200038051 issued earlier this year which discussed a 401(k) plan's violation of ERISA for failing to pay accrued interest to terminated participants for the period from the plan's most recent valuation date to the date of each participant's distribution? It has been my understanding that 401(k) plan distributions can be based on the last valuation date, as long as the length of time between the valuation date and the distribution isn't excessive. Our documents say that it is up to the plan administrator to determine if a new valuation is needed. Any idea if there is now a requirement to pay a certain interest rate?