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?

May a 457 plan sponsored by a governmental employer accept a plan to plan transfer from a 457 plan sponsored by a tax exempt employer?

We are having trouble with a particular custodian and the registration for a beneficiary IRA. The custodian registered the account as:

IRA FBO Client Name, XYZ as Custodian, B/O Client's Father's name DECD.

We prefered, and requested that the account be registered as:

IRA Client's Father's Name DECD, Client's Name benefciary,

XYZ as Custodian.

Maybe I am nitpicking. Is there any difference between the two in the eyes of the IRS?

I'm in need of some information cencerning Certificates of Creditable Coverage and claims administration. We are a TPA and when we enroll a new employee we request a copy of his COCC. If it is not received in 30 days, we send a second letter. If that second letter is not recieved in 30 days, all claims we have pending are denied with the reason "Certificate of Creditable Coverage not recieved."

My feeling is that we should not be denying these claims for a lack of a COCC, but rather, at that point, persue preexisting infomation, thereby treating the individual as someone who does not have any creditable coverage. And if the employee sends the COCC later, reprocess any necessary claims.

I would appreciate anyone's opinion on this. I'm uncomfortable in denying claims based on information that is only necessary for the possibility of a preexisting condition.

Thanks for any help!

Excerpt: "Tax legislation to be considered by the House Ways and Means Committee this week would substantially expand pension tax preferences for high-income executives but likely lead to some reductions in pension coverage among low- and moderate-income workers and employees of small businesses. The pension provisions, which are similar to those included in the large tax bill that President Clinton vetoed last summer, would primarily benefit high-income individuals."

http://www.cbpp.org/7-12-00tax.htm

Do you agree?

Any info on how this affects the otherwise terminated employee's eligibility for other benefit issues?

Are there any consequences to a beneficiary for taking a partial distribution from a ROTH IRA that had just been converted from a traditional and then the owner died (he did not meet the five year holding period)?