Is it lawful to terminate an active employee's or former employee on Pre-65 retiree or Cobra medical and dental insurance if they are Medicare eligible? I know that coverage CAN BE terminated, but if it hasn't for whatever reason can be at any time? Our company utilization and experience is getting worse and worse with each year and is devastating to our rising premiums. We have a few totally disabled and post-65 employees who are covered under our insurance plans. Can workers have both Medicare and Employer-sponsored medical and dental insurance? Thanks for any feedback!

A top hat plan that did not file the DOL statement within the required 120 day period becomes subject to Title I or ERISA. What questions need to be completed on the Form 5500 and is there anyway to avoid this filing?

does anyone have experience in a participant using the NUA when taking a distribution of company stock held inside a 401K

Let's say I have a 10% MP Plan with 1 year wait and no last day or 500 hours/ termination requirement. I want to use this to satisfy a Safe Harbor.

What would you think if made the vesting schedule 0,34%,40%,60%,80%,100%.

My thought is 10% times 34% equals 3+% vested contribution, and easy admin.

Any darts to throw?

If the plan document is silent on the issue, what rights do participants in defined contribution plans have to change the amount or form of the benefit they are receiving? What rights do a plan sponsor, or a TPA, have to set policies preventing or limiting the changes, or the frequency of the changes?

For example, suppose a DC participant elects to receive a 10 year certain form of payment, gets payments for 2 months, then decides a 5 year certain form would be better 2 months later, then decides the 10 year certain form was fine 3 months later. (The plan document allows both forms). Can a participant do this if the plan document is silent? Can a plan sponsor or TPA adopt a policy not allowing this?

A part-time employee had slightly over 1000 hours as of 12/31/99 and should have been allowed to enter the 401(k) plan as of 1/1/00. The employee was never given the deferral election forms. The employee has since terminated employment. The plan sponsor does not make a Profit Sharing contribution but does have match that is deposited concurrently with salary deferrals. Is there any way of getting this corrected prior to doing the actual ADP testing for 2000? Or is the only proper way to do the correction to have the plan sponsor make a contribution equal to the ADP for the NHCEs for 2000 plus associated match and associated earnings on both? Either way, an APRSC would be done.

Obviously, I know nothing about this. Can anyone help?

A ruling issued today dealt with a situation in which two departments of the State of Idaho had had 401(k) plans grandfathered by the Tax Reform Act of 1986. It holds that the state can now adopt a 401(k) plan which covers not only all of Idaho state government, but also political subdivisions of the state. The ruling treats the state and its political subdivisions as being part of one "employer." This ruling can be helpful in extending 401(k) plans to governmental employers which might otherwise appear to be barred from adopting them. It could also be useful on the general question of "who is the employer" in the context of a governmental plan. Although the ruling has not yet officially been published by the IRS, you can see a copy by clicking on the above link.

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Employee benefits legal resource site

[This message has been edited by CVCalhoun (edited 04-20-2000).]

A ruling issued today dealt with a situation in which two departments of the State of Idaho had had 401(k) plans grandfathered by the Tax Reform Act of 1986. It holds that Idaho can now adopt a 401(k) plan which covers not only all of state government, but also political subdivisions of the state. The ruling treats the state and its political subdivisions as being part of one "employer." This ruling can be helpful in extending 401(k) plans to governmental employers which might otherwise appear to be barred from adopting them. It could also be useful on the general question of "who is the employer" in the context of a governmental plan. Although the ruling has not yet officially been published by the IRS, you can see a copy by clicking on the above link.

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Employee benefits legal resource site

[This message has been edited by CVCalhoun (edited 04-20-2000).]

How do you verfiy that an annuity contract complies with the consent requirements, etc of 401(a)(11), 417, and related sections? Is it just a matter of finding the language within the contract? And if no language, get the insurance company to amend it as such????

I have read material on this message board about DROP plans, including the excellent article on DROP plans by Carol Calhoun and Arthur Tepfer. We do not really have any direct experience with DROP plans, but have someone who may be interested in this design. Is the lump sum payment that is paid under a typical governmental DROP plan where the DROP is part of the DB plan an eligible rollover distribution? I did not see this addressed in Calhoun and Tepfer article on DROP plans. Looking at the regulations, it seems to me that the lump sum would be an eligible rollover distribution as a payment independent of a series of subtantially equal payments under Reg. sec. 1.402©-2, Q&A 6(a). However, because I have not had experience with this type of plan design, I was not sure and wanted to ask someone who has worked with or seen this type of plan if this is the right answer. Thanks for any information you mught have on this.

[This message has been edited by CVCalhoun (edited 04-19-2000).]

I know that somewhere out there there is case law or a statute or a regulation or something that limits the extent to which an employer health plan can exclude benefits for services provided in a VA hospital. But I cannot remember or locate the source of this rule. Can anyone help me out with a cite or a lead?

We are a TPA to a plan where the plan sponsor is not forwarding deferrals to us. Due to the fact that we are a fiduciary and trustee to this plan, what course of action can we take to protect ourselves from liability?

I am currently working on a research project for my Compensation and Benefits course and my topic is addressing fiduciary liability when providing advice for retirement plans. Through my research, I have realized there are many employees that are being educated on their company retirement plans but they are not being adviced on how to invest their money. One reason is because many employers fear that they will confront fiduciary liability for providing the advice.

My intentions for sending this email is in hopes to be provided any information on this topic. Personal experiences. Companies you may know of currently addressing this concern. Statistical data. Anything would be helpful.

Thank you,

Tina Elders

student

Just a quick thank you to all who responded. I inherited this plan when I joined the company a few months ago.

I had the same reaction to the pre-tax deductions as the folks on the board. That is the tip of the iceberg.

I had to pose teh other question because it was the TPA telling me it wasn't a qualifying event. Let's just say there are plenty of "opportunites" here.

Thanks again.

How to set up allocation under age based document with two drs. who are sole props?

total schedule Cs and put in PLV 286?

Any issues regarding employee cost?

[This message has been edited by Earl (edited 04-18-2000).]

Seeking comments/insights from those who have drafted QDROs in this situation - esp. in the family owned business setting where the wife must separate from service in order to roll her own account out of the plan.

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My initial thought would be yes, but I didn't know if there was an exemption in the statutes or the regulations that someone was aware of. Please let me know your observations. Thanks.

When calculating the premium for the 12 month determination period, what does the self-funded client base its cost decision on? Can the plan base its calculations on speculation of future claims (such as knowing a very sick employee has just elected COBRA) or must the premium be based on the previous 12 month experience? I have a feeling that this is very wrong but I can't find the exact language to tell me so. Also, as far as being able to change the rate during the determination period, I see 3 express situations when this can be done. In other words, the Plan does not get a free pass every 12 months to raise rates. Is this correct?

My wife just changed jobs, and stopped contributing to her old 403(B) account (although she remains at the old job part-time/per-diem).

The new full-time employer also offers a 403(B) plan.

Does she have to close the old account to open a new one, or can she have multiple 403(B)s (not contributing to one)?

Since she is still employed per-diem at the old place, is there a penalty for closing the account, even if she rolls the disbursement directly to the new account?

Can the disbursement/rollover happen at a later time, or does it have to coincide with opening the new account?

THANKS!

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Gerard Quinn