SEARCHING FOR RESPONDENTS WHO ARE VERSED IN THE AREA OF FICA EXEMPTIONS/ESTABLISHING PERSONAL ACCOUNTS FOR THE EXEMPTION/FINANCIAL FIRMS WILLING TO ESTABLISH SUCH A PROGRAM ETC., ETC.,...THANKS!!!!!!

My client is not sure if he filed his 1998 Form 5500-EZ. Does anyone know a phone number or any way to contact the IRS to determine if the filing took place? Thanks.

As a follow up. I know of one situation where a levy was received after a participant's death. IRS took the position that there was a lien on the participant prior to death and they could attach the account balance even though the plan did not receive the levy while the participant was alive. Plan took the position that there was nothing "owed" to the Participant only the beneficiary and therefore levy was invalid. After an interpleader was filed the IRS allowed the beneficiary to keep the distribution.

It depends on how your plan defines matching contributions. A matching formula that requires a "true up" after depositing on a monthly basis would read "x% of deferrals up to x% of Compensation".

A formula that did not require a true-up would read "x% of deferrals up to x% of Compensation per payperiod". In the second option, there is no true-up and once a participant stops deferring the match stops, which is why in these plans participants that max out early lose out on matching dollars.

In the first option it uses the plan's annual definition of Compensation to calculate the matching, so regardless of why they fell short, there would be a true-up required.

The IRS notices on Safe Harbor Plans seem to define the requirements in terms of "eligible employees" or "employees eligible to defer". If a company is part of a controlled group, can only one company participate in a safe harbor plan (assuming 410(B) can be satisfied, or separately satisfied if each has their own plans, one of which is not a safe harbor)?

Can a safe harbor plan exclude employees by classification?

Is a 401k protected from all creditors in North Carolina?

Here is the situation:

About 40 doctors, all of whom are the sole shareholders and sole employees of their personal service corporations, form a Group to provide services at a hospital. The Group is a corporation. The Group and the personal service corps will form an affiliated service group. The doctors all have medical reimbursement plans in place with their personal service corporations. In order to avoid problems with discrimination, we would like all of the doctors to be considered highly compensated. The only way I can see to do this for each doctor in the Section 105 context is to have them all be 10% shareholders of the employer (105(h)(5)©).

My question is: Which corporation is the employer in this setting, is it the Group (in which case no one is a 10% shareholder) or can it be the personal service corporation (in which case all are 10% shareholders)?

I'd appreciate your thoughts.

I want to know who to contact to use this program

Anyone aware of rules governing company bonus payments. Can a company withhold a bonus payout because an employee quit in November? Shouldn't a prorated 11/12's payout be made? Thanks

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Norm

We offer a DCRA under section 129 (not a cafeteria 125). Can we return any unused withholding to employees? I see where 125 will not allow this but I'm missing it under 129.

In addition to sending COBRA letters to terminated employees and covered spouses, must COBRA letters be sent to covered children also?

A 1999 IRS private letter ruling stated that self-funded death benefits provided by an ERISA multiemployer health and welfare plan will be treated as insurance for tax purposes. The letter ruling, according to my source, is LTR 199921036. I have not been able to locate this letter in CCH. Can anyone help me find this bugger? Thanks.

Corbel does a good job explaining in their help screens how to handle top heavy contributions when cross testing but I need some feedback from real people!!

Under the "safe harbor" method employees receiving only top heavy minimums are treated as not benefitting and if they have 501 or more hours they are shown with zeros in both 401(a)(4) testing and average benefit testing.

Under the "non safe harbor" method, the opposite is true, their top heavy minimums are converted to an EBAR.

I have a client with only profit sharing in their plan which also is top heavy. There is an 18 year old who receives a top heavy minimum and if I use "non safe harbor" method it allows a huge increase for the HCEs over prior years, but I am worried about what "non safe harbor" means to the IRS? Anyone else dealt with this issue?

posted 01-21-2000 03:57 PM

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Is there ever an instance where a QDRO distribution to a spousal alternate payee would be subject to the 10% penalty in a 401(a)? The plan allows for a lump sum distribution or monthly periodic payments or a combination of the two. The spousal alternate payee takes an initial lump sum then monthly payments - which are not subject to the 10% penalty. But later decides she needs another lump sum distribution (not the entire amount). Is this amount subject to 10% penalty - does it make the other amounts already distributed subject to the 10% penalty?

For any of you who missed the RIA article on 403(B) Plan Audit issues, it is available online by clicking here.

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Employee benefits legal resource site

Is is legal for an Employer to bill terminated participants a $50 processing fee?

The employer is charged this from their TPA and would like to pass this cost onto the participants.

We have a client--owner of a small (20- employee) business--who wants to terminate the company's DB plan. The plan has a substantial liability on a termination basis, but most of the liability relates to benefits owed to the owner. He'd rather waiver a large portion of his accrual than find the cash to completely fund the existing accruals on a termination basis.

I seem to recall that the PBBG has no problem with waivers under certain circumstances (are there limits?), but what's the IRS's view? Is the waiver an impermissible forfeiture? Does the waiver have to be reflected in the plan document, or does the document have to at least permit waivers?

[This message has been edited by Ed F (edited 01-25-2000).]

All this is within the 60 days election period:

Employee elects COBRA and pays first month premium.

Gets a new job, becomes covered by new plan, tells former employer to cancel COBRA.

Quits new job, calls former employer and wants to re-elect COBRA.

Must the former employee allow him/her to re-elect?

There is a PEO with 6 (so far) client employers. the PEO sponsors a multiple employer Cafeteria Plan with the Flexible Benefits options. It allows the co-employers to opt out of the flex and only offer the POP option to its leased employees. How can they do this, if all benefits are supposed to be reasonably available to all employees? Can each co-employer choose its own cap for the medical reimbursement?

Could someone tell me their admin procedure when a 401(k) fails the ADP - do you reduce the deferral to the amount given on the first ADP report (where it shows it fails) and then include in your report to the client the RTS report showing it failed? I just ran across I think a first for me where I noticed there continually was a reduction in the ADP (a loop)and was wondering if the loop would continue on so the ADP would never pass? Appreciate any insight into this. Thanks.