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?

Residents in Federally Subsidized Housing pay rent equal to 30% of income. The local housing authority in CT is counting both interest on CDs held in an IRA and the required minimum distribution (person is over age 70) as "income".

I have been told there is nothing in HUD rega to give IRAs any special treeatment. Have there been any appeals to this type of ruling? This would seem to be a national problem with the popularity of 401k plans and IRAs which are treated the same way under this system.

A plan provides an annual COLA. A participant chooses the lump sum option. Is the COLA typically included? The plan does not explicitly state one way or the other. is there any feeling as to which is appropriate or what the default would likely be?

When a terminated participant is paid his entire vested interest in cash, and the employer stock that was previously allocated to his account remains in the trust, should that stock be reallocated to the remaining participants' "employer stock" accounts or is it held in the pooled "other investments" portion of the trust?

I believe that the demutualization award should be treated as a plan asset (and considered as investment return) to the extent that it derives from an annuity contract included in plan assets.

I'm wondering if I can take original contributions out of a Roth IRA at any time since taxes have already been paid on them. I'm 26 years old and would like to put $2000 in a Roth IRA, but I'm going back to school in the fall. Most likely I'll be able to support myself with part-time work, but if money gets extremely tight, would I be able to get the original $2000 out with no penalties?

Company X took over Company Y. Both have 401(k) plans. As part of the takeover, Company Y's plan terminated. The current service provider for Company Y's plan has been cold calling employees to get them to roll their assets into IRAs with the current provider. Company X wants employees to roll their assets into its 401(k) plan. Company X suggested to Company Y that the Company Y plan be amended to bar direct rollovers to the current service provider. Is this allowed?

How does the 15% limitation affect a SARSEP? My reference material states that the 404 deduction limit applies to SEPs on an individual basis rather than on an aggregate basis as in a profit sharing plan. I have a SARSEP in which a participant deferred 15% and the employer SEP contribution is 4.5%. In aggregate the 404 15% limit is fine. What are the consequences to this participant?

What are people doing about updating cafeteria plan documents under the final regulations issued in March, 2000? Or are people waiting until the proposed regulations from March, 2000 are also in final form??

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I read that a "change in residence" qualifies as a change in status. If an employee moves, but insurance coverage does not change, does this qualify as a change of status such that his medical spending account election can be changed?

The "eligible employees" who would have joined the acquired plan have to be permitted to join the merged plan. See IRC 414(a)(1).

I am hoping that someone can clarify what I need to be aware of for the rest of this calendar year to ensure that I do not exceed my maximum AGI allowed for this year.

I am a single, 38 year old male and am under the impression that the maximum amount that one can earn during calendar year 2000 is $100,000 (AGI) in order to be able to transfer to a Roth IRA without having to recharictarize afterwards.

I converted approx. 17k from my 401k to a traditional IRA earlier this year and then from the traditional IRA converted the 17k (I requested 10% withheld for federal income tax purposes) to a Roth IRA. Therefore, approx. 15.3K was transferred to the Roth IRA.

Using this example / scenario, if my earnings from employment was 60K and I had short term capital gains income of 30k, would I qualify or would I need to recharitarize? I am under the impression that either the 17k or 15.3k that I transferred to the Roth would be added to my AGI and therefore I would go over. If either of these (17 or 15.3 are added) which one do I use for planning purposes?

Using the above scenario, if my earnings from employment was 30K and I had short term capital gains income of 60K, would there be any difference (90K in both examples) in determining eligibility for the Roth IRA conversion?

Are both earned income from employment and unearned income from short or long term capital gains included in determining AGI for Roth IRA eligibility purposes???

I want to do whatever I need to do to make sure I do not go over this limit as I truely believe the Roth IRA is the better long term retirement vechicle. I still have time to restrict my short term capital gains if necessary.

Thank you in advance for your assistance. If anyone has literature that you could forward or mention that uses some specific similar examples or lists all of the determinants in qualifying for the Roth IRA conversion, it would be greatly appreciated.

[This message has been edited by Kevin Martin (edited 06-25-2000).]

I'm looking for information on deferred accumulation plans in esops which I understand is a brand new area.

I'm looking for a discussion or explanation, preferably on a governmental web site, of the fiduciary responisilities of 457 plan administrators, e.g. that decisions have to be made solely in the interest of the employees. Thank you.

I am single 36yr old and the value of my Roth IRA has ballooned from the boom in technology stocks. I converted it 2 years ago at 176K to pay for the conversion I sold a principle residence at a gain and moved into a smaller place.

What is the maximum limitation to the value a Roth can be worth and will it be subject to excess distribution taxes and will my taxable 401 K be included in the calculation?