What are the tax consequences of gifting Sec 1042 replacement stock to charity? Does the donor get the full deduction for the current FMV? Any requirement to pick up income?

Has anyone ever received a request to accept a rollover for a terminated participant's PRIOR employer's plan? Adoption agreement is pleasantly vague - says Admin Committee has sole discretion in determining whether to accept rollovers (they currently accept r/o's from any employee - did I just answer my own question?). I can't imagine that would be required but I wanted to run it by this gang of experts!

Can a state governmental DC plan (established pursuant to 401(a)) receive eligible rollover or plan-to-plan transfers of lump-sum distributions from participants of another eligible retirement plan (either a governmental plan or a nongovernmental plan)? I know that private plans can receive rollovers (if the written plan document allows for it), but am completely unsure if state plans can.

Thank you for your help!!!!

Can a state governmental DC plan (established pursuant to 401(a)) receive eligible rollover or plan-to-plan transfers of lump-sum distributions from participants of another eligible retirement plan (either a governmental plan or a nongovernmental plan)? I know that private plans can receive rollovers (if the written plan document allows for it), but am completely unsure if state plans can.

Thank you for your help!

Can a 401(k) profit sharing plan be terminated retroactively? If so, are there any limitations on when termination amendment must be adopted (such as by 2 1/2 months after end of plan year)?

I have several questions regarding completing the 5310 for a profit sharing 401(k) plan termination. The plan terminated and the sponsoring employer was sold during 1998. Account balances have not been paid out yet.

1. Should the "current year" on lines 13b and 16 be 1999(now) or 1998 (the year plan was terminated and company was sold)?

2. On line 9d, should the "last contribution to the plan" take into account 401(k) deferrals and/or match, or just profit sharing contributions?

3. On line 16a, should "Employer contributions" take into account 401(k) deferrals and/or match, or just profit sharing contributions?

4. On line 13b, since business was sold during 1998, should line 13b(5) be 0 for Number at end of plan year?

5. Participants terminated during 1995 with less than 100% vesting, but their balances have not yet been paid out. They were made 100% vested when the plan terminated. Should these participants be counted on line 13b(6) and an attachment done, or can line 13(B)(6) be 0 for 1995 since they were made 100% vested on plan termination?

Help with any or all of the above would be much appreciated. Thanks.

I have a situation in which an employee has passed on. Her beneficiaries were her three daughters, one of which is in prison. I sent out termination paperwork to them. However, I received a note from the sister in prison stating that she would like the check to be made out and sent to one of her sisters. As I understand it, she is waiving her rights as a beneficiary and putting her trust in her sister to send the monies to her. My question is if the small note is sufficient to waive her rights? Is a more legal document required?

I'm a college student who recently started my Roth IRA. I'm wondering about is my ability to trade within the IRA. Can I trade the stocks i buy, or do i have to sit on them till I retire? I'm just confused, and wondering if I sell and use the money for another purchase in my IRA, will I have to pay taxes on the profits? Or is the the real advantage, where I can make 1000 bucks a year on good trades and not have to pay taxes? Any info would be helpful, thanks.

You are correct.

I have a client who just started with our 401(k) service, and after reviewing their prior plan years I have found that they failed the 1998 ADP testing. I have been in contact with the companies prior recordkeeper, and i have been trying to get them to give me the earnings associated with the Excess Contributions and any GAP earnings. The other recordkeeper claims that GAP earnings must be calculated from the 1st day after the plan year until the day the excess contributions are removed. I am under the impression that you only include Gap earnings from March 15th forward. If anyone can give me some guidance or point me to the right section of the code, I may be able to resolve this situation.

I have a group of doctors that want to go with a safe harbor plan for 1999 and were told they could make the plan effective 10/1/99 and could defer the full 10K as long as they gave the NHCEs the 3% nonelective.

Under what circumstasnces can this or can't this be done. There is no PS component to the plan. If we added one and the client din't make a PS contribution could they go ahead with the above scenario.

Obviously, we're fishing here.

When doing a top heavy calculation for a defined contribution pension plan (i.e., money purchase or target benefit plan), it has been my understanding that contributions due as of the determination date are included even if they are not actually made by that date. However, for non-pension plans (i.e., profit sharing plans), only contributions actually made by the determination date are included (except for the initial plan year). Do these same rules apply to 401(k) contributions? Initially, I thought that since 401(k) contributions are required to be deposited in a timely manner, that any 401(k) contributons deposited after the determination date for the prior period should be included when doing the top heavy calculation. However, after reviewing 1.416-1, T-24, it appears that this is incorrect.

I understand that we have to offer COBRA participants the same medical options as we do actives during open enrollment.

the question is this: "we are eliminating 1 of the medical plan options during OE and want to know if we can set a default plan if the COBRA particpant does not respond by electing another plan?" we will be doing this for our actives. does anyone foresee any problem(s)with us doing this? at least we're not cancelling their coverage.

Is anyone aware of rules for IRC Sections 105 or 125 analagous to the QSLOB rules?

Each year our small business gives raises. Some people elect to have a greater portion of their insurance premiums paid by the company instead of directly to them. Is it legal for a company to pay 75% of one employees medical and 95% of anothers?

One section of the document provides: An Employee must have completed 6 months of Service with the Employer prior to an Entry Date. Another section provides: An Employee will enter the Plan on the first Entry Date on or after the date the Employee satisfies the eligibility requirements set forth above. These provisions only conflict for an employee who satisfies the eligibility requirements on an Entry Date (the first provision would make the employee wait until the following Entry Date while the second provision would not). Can this be fixed by amending the plan so that the sections no longer conflict? Does it matter which section is amended? Should an IRS correction program be used, and if so, which one? Thank you.

I have 3 companies, all owned 50-50 by the same two people. They want identical plan provisions for all 3 corporations. Can I put all 3 on one prototype document, with each corporation signing a signature page and a board resolution? If I can, then what Tax-ID number do I use when filing the 5500C/R form? Or, do I need 3 documents and 3 5500 filings (realizing that I have a controlled group and the plans need to be aggregated for testing purposes). Thank you.

Plan year 7/15/99-6/14/00. All employees meet hours requirement in first 12 months of employment. All employees are over 21. Employee A hired 7/14/98. Employee B hired 7/15/98. Employee C hired 7/16/98. Employee D hired 7/17/98. What are the latest entry dates possible under 410(a)(4) (assume plan document is written to provide for latest possible entry dates)?

In a cross tested plan with a 401(k) feature, the salary deferrals must be included when determining whether or not the plan satisfies the average benefits test. Questions: (1)A company has a SARSEP and during 1999 wants to start a Safe Harbor 401(k)(3% QNEC, no match). Is the SARSEP considered an existing p/s plan? (2)Assumung the answer to (1) is no, must the deferrals to the SARSEP prior to the effective date of the 401(k) plan be included in the average benefit test?

How do you correct an excess annual addition when the participant has received a full distribution of their account? The excess occurred in the last plan year so I believe the correction method should be the placement of the excess in a suspense account described in Reg. 1.415©-6, but in this situation are we required to have the former participant give back the excess annual addition (without offsetting for withheld tax)? Any guidance would be much appreciated!