Currently, PSP provides only for an annual valuation. Employer wants to amend PSP to provide for quarterly valuations and distribute quarterly benefit statements to the employees. Everything in PSP document is geared to annual valuation. Probably would be necessary to go through whole document and amend every reference to annual valuation. Any suggestions??

Is there any way to leave the same message on more than one message board at the same time???

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How should the distribution of trailing contribution(s) be handled in the event a participant requests a lump sum distribution and the distribution is made before all contributions have posted to the participant's account. Often in a daily processing arrangement a participant may be able to receive a distribution immediately after his or her termination and before all pending contributions have posted. Is it appropriate to distribute the trailing contribution in the same manner as the original distribution was distributed if the trailing distribution occurs no later than 90 days after the participant received the original election and tax notice? (I know in practice that this is often what occurs but is it appropriate?)

I was asked how do you do an MEA for a TSA participant who also is covered by a cash balance plan? Since this is our first time with this combination, I haven't thought about it. I assume you would use the accrued benefit value of the annuity that the current lump sum value could be converted to. Anyone have some thoughts on this and/or references for support. THANKS!!

I need to know what the legal issues are for changing the FSA plan year in the middle of the year. Causing the FSA plan to be a short plan year. The company is a fully insured plan.

We want to set up a retirement plan for an individual (1 participant plan).

The participant receives Sched. C income as an independent contractor that sells mutual funds. This is his primary income.

In 1999, he will also receive a Sched. C for income earned as an independent contractor that sold insurance. He has retired from the insurance company. He was a statutory employee of that company and, as such, was not eligible for their retirement plan.

Can we use both Sched. C incomes in the new plan?

Client of mine was employed by a County Hospital for approximately 17 years until 1974. Client left employment. At time client left, Hospital's retirement plan required 20 years service and age 55 for full benefits. Hospital rehired client two and a half years later promising client that prior years of service would count under new retirement plan. Client worked additional 3 1/2 years and then terminated in 1979. Sometime after termination, Hospital employee told client that "he did not think client was eligible for any benefits". Client has asked me to look into the matter. If this were a current plan issue I would normally request a copy of the summary plan description. However, given the lapse of time, and other than calling the HR department at the Hospital, I don't know how to go about getting information to verify if client was/is eligible for retirement benefits. Any suggestions?

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I am hearing a lot of hype from the investment community about adding a DB plan to the retiremnt program for small closely held businesses for the plan year starting 1/1/2000. This sounds great for owners, another deduction for the DB plan in addition to the current 30k.

However, I thought the repeal of 415(e) was a benefit limit not a deduction limit. Does anyone know where the cross reference to give the needed releif to 404(a)(7) is?

I've not seen it and am afraid most of any new plans sold by these "investment guys" will end up with nondeductible contributions and 10% excise taxes a year later. Am i missing something?

Situation is 98 discrimination test failed, refunds need to be processed in order to make the test pass.

Are refunds due to HCE's after April 15 subject to 98 or 99 taxation? Are there any other ramifications to consider?

The SIMPLE and DB cannot co-exist in 1999. The DB must be effective no earlier than 1/1/2000. SIMPLE deferrals must stop by 12/31/99. If the SIMPLE is a SIMPLE IRA, the prior SIMPLE plan will not affect the DB.

On an IRA, you should use the current IRA account value to calculate the first year's SEPP.

Under the Amortization method, you can choose whether or not to recalculate the SEPP each year. If you don't recalc, you'll draw a constant amount each year. If you choose to recalc, you would use the 12/31 prior year balance to figure the distribution amounts in years 2 and later.

If the SEPP is on a QP, the plan administrator would set these calculation guidelines.

Looking for any insights or information on structuring bonus or other "compensation" strategies for LLC members.

Ideally the arrangement would be the LLC equivalent of a nonqualified deferred compensation plan. (Have already posted on that message board, to no avail.)

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What is the correction when an ineligible employee of a single-employer with a 401(k) profit sharing plan is allowed to make 401(k)contributions and receives matching contributions? What must happen to the deferrals, interest on the deferrals, matchin contributions, and interest on the match? Can an IRS self-correction program be used? If so, which one? Can any money be returned as "mistake of fact" if the plan has the proper language? What would constitute a "mistake of fact"? When would the one-year period start? Would any of the answers change based on how long the ineligible employee had been allowed to make 401(k) contributions and get the match (3 months vs. 2 years)?

When an employee is married and changes her name to take her husband's, which is the appropriate form(s) for proof of ID that must be completed?

We have drafted model QDROs for our client to use, in order to ease administration. One issue that we had failed to address is when the participant is not fully vested in any or all of the amounts allocated to an alternate payee under the QDRO. We have proposed that to the extent the allocation includes nonvested amounts, the participant and the alternate payee will share equally in the vested portion of the account balance (in accordance with their remaining interest in the plan after the QDRO). This way, the alternate payee is not able to take a distribution of all vested amounts, leaving the participant with the nonvested amounts.

Also, we propose that if the allocation includes nonvested amounts, that no distribution of any amounts be permitted until the Participant becomes fully vested (or vesting can be determined with some certainty, as in a retirement or termination).

Any thoughts?

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Here is the situation...

Company is self-funded and they base employee contributions on their maximum exposure.

Company has a good year and wants to return a portion of the contributions back to their employees.

How do handle this, given that (a) a company will not know the total medical costs for 6-12 months after the plan year is completed due to claims lag and (B) by the time total costs are known, many employees are no longer with the company?

Thank you for your advice.

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As a benefits broker, one of my clients needs to print a new booklet because we have installed a new TPA and we have convinced them to modify several of their benefits.

Can you provide me with any reasonably priced printers that you have used.

Thank you.

Bob Wolff

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I am familiar that Summary Annual reports are required for retirement plans but not welfare plans. I have a few questions.

1. Are they required for welfare plans with over 100 employees where a 5500 would be prepared?

2. Where can I find the regulations and instructions that cover this? Could you e-mail or fax them to me?

3. Do you have any samples that I could use as a template or direct me to a resource that has a sample form?

Thank you for your help!

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Calendar Client with Target Benefit has closed up shop and wants to terminate plan, say 9/30/99, but make a final contribution for the year.

Question bugging me is, do I have to pro-rate the compensation limit of $160,000?

Is the intent of question 27(B) of the 5500, asking if any loans by the plan are in default at the end of the plan year, to identify loans to participants that are in default - meaning repayment has not been received within the Plan's allowable grace period and required to be considered a deemed distribution?

We received a private letter ruling that our plans are governmental plans under 414(d). However, for various reasons, we may withdraw our request to the DOL that our plans are governmental under ERISA Title I. If we are governmental for purposes of 414(d), but not for ERISA Title I, do we have to file a 5500 with the DOL. My impression is no, but I cannot confirm this. Help!!