When the spouse of deceased 401k participant receives a lump sum distribution, how is that taxed? Does the date of death have any relevance or is it 20% of market value on valuation date?

Does the pending repeal of the combined 403(B)/457(B) deferral limitation (in pending pension legislation) create plan design opportunities for 403(B) plan sponsors who wish to circumvent the 402(g)limits for applicable employees? For example, if the repeal is passed, could an employer who maintains an exisitng 403(B) arrangement simply establish a 457(B) plan as well, so that employees who are capped at the 402(g) elective deferral limit of $10,500 (indexed) could defer up to an additional $8,000 (indexed) in a 457(B) arrangement (assuming that the other limits that apply to the respective plans do not come into play)? I suspect that this is not the intent of the legislation, and that the repeal would only apply to plans of unrelated employers, not the same employer, but I want to make certain that I am not ignoring a plan design opportunity here...

What does the industry consider as a normal black-out period when converting a plan from one recordkeeper to another? How much would this change if the plan decided to sell all assets before making the move? What if the custodian was also changing? Thanks, JimJ

If you are aware of anyone who might be interested in a new position with a TPA firm in Denver, we have 2 excellent opportunities, and we would appreciate you for passing this message along or letting us know who we might contact. The first opening is for a Daily Valuation Plan Consultant, and the second, is for a Director of Daily Valuation. I will be happy to provide greater details to anyone who is interested. Relocation assistance is available. Thank you!

What are the rules with respect to COBRA and bankruptcy? Can a company who files chapter 11 terminate its welfare plan before filing to avoid COBRA obligations? What about situations where there is a liquidation and no one is left around to administer COBRA? Any help would be appreciated.

Thanks

If a SARSEP is nearing the 25 eligible employee threshold, can it PROSPECTIVELY amend its eligibility requirements to exclude more employees (e.g., require service in 3 of previous 5 years, instead of only 1 year), and thus sidestep ineligibility for at least a few years?

If a governmental entity has a grandfathered 401(k) plan, is that plan subject to ERISA (i.e., Title I) or is it exempt because the sponsor is a government (a political subdivision of a state)?

Controlled group situation. Employer A and Employer B 100% owned by the same person. Employer B adopts a plan yet employer A does not. Lets assume 410(B) is not an issue. When an employee transfers from Employer A to Employer B who has a plan, does the employee receive credit for the service with Employer A and therefore would not need to satisfy the eligibility rules and would already have years of service for vesting requirements? Would you consider prior year compensation when determining Highly compensated employees?

What items would fall under the definition of compensation for a church-sponsored 403(B) plan? Where could this information be located in the tax code?

Suppose a target plan converts to a profit sharing. Now they want to add in-service withdrawals. Are there any regulations specifically allowing (or not allowing) this?

For a qualified transportation fringe benefit plan, if an employee regularly reports to two different office locations every week, may the employee be covered for transit and parking expenses between his or her home and each office location? For example, on Mondays, Wednesdays and Fridays, employee X reports to Office 1 in City A. On Tuesdays and Thursdays, employee X reports to Office 2 in City B.

There are many questions about 414(h) pickups-

Can anyone offer a brief summary of what this is all about- and can a Government Plan offer a Money Purchase Pension Plan under 401(a) with a mandatory 3% pre-tax contribution? how would you set this up.

A plan has a target benefit contribution at year-end. The plan sponsor (employer) would like to submit a set dollar amount per month to the bank trustee to be invested. The actual allocation would still be an annual allocation but they would still like to remit funds to the trustee monthly. The money would be put into a suspense account, where the employer would direct the investments. In the case where the market takes a dive and they do not have enough in the account to allocate to all participants, they'd be required to submit additional money to cover the contribution. Would that additional money be deductible to the company? If the market went the other way and the account earned more than what was needed for the allocation, would the additional funds have to be allocated to all participants in the plan (not just those eligible for the allocation)?

Can the employer set up an account in the plan?

My suggestion has been to set up an account outside the plan, but the employer seems insistent on having the account inside the plan. Any suggestions?

Assuming that a sound pre-installation ESOP study has been completed (and confirms that an ESOP will satisfy the plan sponsor's objectives), what are the next steps that must be taken to actually install an ESOP? Assume that the plan sponsor is a C-corporation. Thanks.

I am currently participating in my company sponsored 401k, my wife is a teacher and has a403b plan. Are we eligible to open Roth IRA's in addition to our other retirement accounts?

When a defined contribution plan with outstanding loans is terminated- what must the plan do with respect to outstanding loans. Example- Company has 50 employees in a Profit sharing/401(k) plan. Two employees have 5 year $15,000 loans and one employee has a 5 year $30,000 loan. Now the plan is terminated and wants to give everyone a rollover distribution. (All company's assets are sold and employees are terminated) What do you do about the loans. Assume the plan document is silent- what should the plan document have said with respect to this-

What if all of the employees say they can't pay it all back if it were recalled? Please help.

I have two daughters presently in college and I would like to start a Roth IRA for them both. What is the mininum or maximun amount of money I would have to contribute on a monthly basis?

I am working with a Trust Company (A Holding Company) that is issuing a separate class of stock to a number of other smaller Trust Companies around the country that it is acquiring. We will be filing a consolidated tax return, but the acquired companies will maintain their idenity and operational control. The questions is can we maintain the separate benefit plans that these acquired companies presently have, and if so, do we have to aggregate them for testing purposes? What about employees; can they continue to be paid by their existing company, or do they have to go on the payroll of the Holding Company?

It is my pleasure to announce the Employee Benefits Congress 2001. Sponsored by the International Quality & Productivity Center (IQPC), Employee Benefits Congress 2001 will be taking place at the Sunburst Resort in Scottsdale, AZ, March 6-8, 2001.

The presenters at Benefits 2001 will show you how to leverage your benefits to become an employer of choice! You will learn how to use web technology to maximum advantage to not only transact your benefits business processes but also to deliver services quicker, easier and more effectively. These are just a few of the take-aways you'll learn at Benefits 2001.

For detailed information about Benefits 2001, please email me at marilyn.steinthal@iqpc.com. I will be pleased to get out to you our early-bird agenda. Sign up now for the conference and get an instant free workshop (value $400)! Email me and I will register you immediately!! Offer expires November 1st!

If you have an exciting story to share at Benefits 2001, please contact me immediately at marilyn.steinthal@iqpc.com!!

See you in 2001,

Marilyn Steinthal

Managing Director

973-812-5186

We have a calendar year cross-tested PS plan with a last day rule. On 10/2/00 ten employees walked out of the office leaving behind five HCE's and two NHCE participants. In order to pass the coverage test, I brought in the terminated participants who had the most hours and was able to pass coverage by giving contributions to six of the terminees.

For the cross-tested formula, I have three categories: 1 - physicians, 2 - actively employed staff members, and 3 - terminated staff members. Do the Class 3 employees have to receive a minimum 3% top heavy contribution if Classes 1 and 2 receive in excess of 3%? The plan is top heavy for 2000.