I am looking to benchamrk benefit plans with other organizations in our field and need sugestions on how to get this data.

If an underfunded plan is frozen, and 5 years later the sponsor wishes to provide an unscheduled COLA (flat % for example) to retirees only, is this permissable? The assumption is that the plan continues to be frozen (not terminated).

[This message has been edited by AndyH (edited 06-08-2000).]

if an employer goes bankrupt and a successor employer hires the employees to do the identical job, has there been a separation from service? Do we need to pay out the participants as a result of this situation?

the new company would like to assume sponsorship of the plan and not make distributions.

In 1999, the court and Plan approved a QDRO. Alternate Payee rolled over the award to a conduit IRA. Now the plan is being asked to take back the funds as a rollover into the PT's account - the original QDRO apparently did not properly divide all assets and the attorneys want it reversed. Tax avoidance is key. How can this be done?

Whatis a KEYSOP? From what we know it seems to be a nonqualified deferred comp plan that invests in employer options contracts. What are the advantages, tax and otherwise, of doing this? Any info would be helpful.

Our firm has assumed responsibility for a 401(k) plan as of 1/1/99. In reviewing the files for 1998 we discovered the plan was "Top Heavy". The prior TPA advised the client of that fact in 1998; however, the minimum contribution was not calculated properly - Entry Date compensation was used for new entrants rather the plan year compensation.

One of our staff feels that unless the client corrects the problem we will be held liable as we know about the problem. Others disagree with that position. Question: who is correct?

Also, another staffer feels that if the client makes up the shortfall (and includes earnings) by 12/31/99 under the VCR program, this will correct the problem, HOWEVER, they feel the corrective deposit is not deductible. Their rationale is that since the corrective deposit relates to 1998 and that year is closed no deduction is possible. Another staffer feels that if the 1999 contributions plus the 1998 correction are within the 1999 415 limits the full amount is deductible in 1999. Who is correct or is there another answer?

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W.J. Parks, Jr., CLU, ChFC, JD, LLM

we have a client who after attaining age 70 1/2 started to receive distributions based on his life expectancy. three years later he married and recalculated the amount of his distributions using joint life payout. Was the 1st election irrevocable thus making the recalculation improper? If improper what do we do?

I want to access my Quantech workstation from outside the office but do not necessarily wish to use the software (terminal server) recommended by Corbel. Is anyone using packages like PcAnywhere, etc to do this? If so are there any limitations or problems?

[This message has been edited by Alan Simpson (edited 06-08-2000).]

A participant is charged a front-end load each time he makes a repayment on his participant loan. The question is, is this legal?

We currently use OmniWeb (Planweb?), a product of Pyramid Digital Solutions, to create an interactive website for our retirement benefit plans. Has anyone else had success with other vendors? I'm particularly interested in Quantech's web product.

Am I reading Rev. Proc. 2000-16 correctly?

It appears to me that the fee for the VCR program is based strictly on the most recently filed 5500 at the time of the submission. So if a plan had 1,050 participants at the time of the operational failure but no more than 1000 were shown on the most recently filed 5500 at the time of submission, the fee would be based on no more than 1,000 participants, correct?

Also, it appears to me that even if the VCR covers multiple failures, including failures in different years, there is still only one fee for the submission, again based strictly on the numbers from the most recently filed 5500 at the time of submission, correct?

I need some advice. Do you recommend allowing participants to pay-off defaulted loans using after-tax funds? Do you know of any record keeping systems that are set up to do this? On the same topic, are there any record keeping system that calculate interest on the defaulted loans?

Thanks!

A Plan Sponsor/Trustee in a daily-valued, trustee-directed profit sharing plan keeps forfeiture money in the funds they were invested in at the time of the forfeiture rather than moving the money to a stable value fund. Forfeitures are reallocated.

1) a) At the time of reallocation, if the funds the forfeiture money is invested in have lost money, is the plan/sponsor trustee required to contribute the amount of the loss to the plan?

b) If so, is this contribution deductible?

2) If the funds the forfeiture money is invested in have earnings, what happens to the earnings (do most documents cover this)?

If a plan is top heavy for a plan year do practicioners assume continued top heavy status for determining projected benefits?

[This message has been edited by Don N (edited 06-08-2000).]

The question is pretty much contained in the subject heading. 4044(d)(2) provides that if an amendment grants the employer a right to a reversion of excess assets or increases the amount of the reversion an employer may receive, then that amendment cannot be effective for 5 years. Plan amends to switch to GATT rates effective 1/1/2000, as required by law. This in practice increases the chances of a plan having excess assets, and increases the amount of excess assets and plan will have. Does this amendment trigger the 5 year waiting period?

I'm trying to do a realistic comparison of converting or not converting to a Roth and need to know what approach is most commonly used by planning/tax professionals to equalize the performance of the IRA and the taxable accounts.

I realize that when evaluating a Roth conversion it's mandatory that the IRA and the Taxable accounts' pre-tax, composite performances (interest, growth, dividends, distributions, etc.) are the same. That is, if the IRA's overall performance is less than the taxable account, it's an unrealistic bias against the conversion, and if it's more it's an unrealistic bias favoring the conversion. So, for a meaningful evaluation of converting vs. not converting, both accounts must have the same composite performance.

What I'm really struggling with is, what assumptions/changes do others commonly make to the taxable account to equalize the performance of the two accounts?

There are two obvious answers. One straightforward answer is that if the taxable account consists of ONLY stocks and funds- the composite percentage of the stocks and funds growths plus dividends plus distributions should be the same as that for the composite IRA account.

But for my case the taxable account has tax-free, US government paper, corporate bonds and preferred stock, and it's composite performance is less than my IRA account's (I understand that this is a dumb situation that should be fixed regardless of the conversion issue). So what approach is most commonly used/recommended by pros to equalize the composite performance of the two accounts by changes to the taxable account? Should I simply increase the assumed growth of the stocks and funds, or "sell" all of the tax-free, US stuff, and bonds and "buy" more stocks and funds with the proceeds, assume that the taxable account has the same equities as the IRA account, or ?????

Thanks for any help offered.

What happens is after you have $2,000 in a Roth IRA account your AGI for that tax year exceeds $160,000

Profit Sharing Plan, Several doctors and common law employees. The company wants to charge terminated doctors with segregated accounts their share of the fees (management fees and administrative fees)the terminated doctors agree to pay their share while in the plan knowing that if they roll out to IRA's they would pay more fee by themselves. The company wants to pay the remainder of the fees outside the plan. Since terminated HCE's no longer provide an economic benefit to corporation can you charge their share of fees to their segragated accouts.

Does a pre-deceasing wife's estate tax return include her "community property" half interest in term life insurance on the surviving husband--who is also the policy owner. This is a novice question from a community property state, Texas. Thanks.

Don

Is there anything preventing a private non-profit entity from being named as trustee under a 401(k) plan?

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