Do the funding vehicles for a TIAA-CREF 403(B) plan have to be the vehicles offered by TIAA or CREF? Can a participant direct that his salary deferral be sent to XYZ Investment Firm?

Even without looking at the plan, I would think that a participant would not be locked into only TIAA-CREF funding vehicles. The only restriction would seem to be that the XYZ Investment Firm would need to invest in annuity type investments and otherwise comply with the rules under 403(B)....

Any comments????

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forfeitures: I am not sure where the bug lies. I too have had some problems and I am doing dollar accounting. I modified some of the Quantech reports to separate the contributions and forfeitures into separate items. There are 'two' gains items on a lot of the reports. E.g. : sum gains/loss (usually supressed) and dispSsUnrealized gainAmt. Since I am not doing share accounting, I reversed these items...suppressed the unrealized gain and unsupressed the gains items. This solved my problem. Since I am a Crystal 'tinkerer' rather than an 'expert' I figured I might have done something wrong. However, since 'daily' also reports a problem, it sounds like a bug might exist, at least at the report level- but without time to look at deeper I don't know. In the account screen are forfeitures showing as both $ and shares?

2. Eligibility - not sure what is meant here, 'clicking on the first box'. which one? I have had very few problems in this area, but then maybe I have a better understanding of what happens when you click on the different elements. (Lots of experience on this one going back to the old Pentabs system) give an example and maybe I can help.

(sorry, thats all for now)

I am in need of benchmarking data for price and service relating to retirement(both pension and 401(k)) plans and welfare plans. What are some good resources?

Here is the set-up. Taxpayer has had a traditional IRA for several years,

making non-deductible contributions for approximately 10 years (therefore a total of $20,000 has been contributed.) The monies were invested in a high-risk fund, consequently the remaining balance is about $3,000. He directs the bank that handles the IRA to transfer the funds to a ROTH managed by one of the big investment firms.

I have a suspicion that he has blown the opportunity to claim the $17,000 loss

by this direct transfer. I am of the opinion, that the only way to preserve the loss is to take physical possession of the $3,000, and even wait out the 60

day period. Then, open a Roth as usual.

Anyone have any comments? I cannot find anything specific when the Traditional IRA has lost so much and then gets converted.

Thanks.

Ken.

Could someone please explain to me in plain and simple terms what taxes I would owe in the following scenarios:

1. I transfer $2000 out of my traditional IRA (currently worth $14K) and use that to open a separate Roth IRA for myself.

2. I take $2000 out of a non-retirement mutual fund account and set up a separate Roth IRA for myself.

Exactly how much in taxes would I have to pay in each scenario. I am currently married, filing jointly in the 28% tax bracket.

A simple explanation would be greatly appreciated since I'm very confused as to which would be the best route to go. We can't afford a big tax bite, but really want to set up Roth's for ourselves to invest in. Can you set up a Roth IRA with an amount less than $2,000. I know that's the maximum individual limit.

Thank you.

I understand that, with a

few exceptions, Section 213

medical expenses can be

reimbursed under a health

care FSA. If an employer

does not wish to allow

reimbursement for a

particular 213 medical

expense (for example, the

newly approved smoking

cessation programs), can a

plan specifically exclude

such expenses from the list

by communicating that

specific expenses is not

eligible for reimbursement

under the plan?

Situation: Employee has money in a retirement plan with previous employer and wants to roll it into plan with new employer. Employee is due required minimum distributions from prior plan due to the attainment of age 70 ½. However, when the money is rolled into the new plan will the employee still have to take RMD's applicable to the rollover money even if the new plan allows for the postponement of the RMD's until termination of employment. (Note, until the money is transfered the RMD's will be taken)

Any cites would be appreciated.

Employer A maintains Plan Z.

Employer B maintains Plan Y.

Plan Z has a 12/31 plan year end.

Plan Y has a 6/30 plan year end.

Employer B bought Employer A.

Plan Z was merged into Plan Y effective 1/1/99.

The question is - how do we do the ADP test for the plan year ending 6/30/99?

For those participants who came over to Plan Y on 1/1/99, do you use only compensation from 1/1/99 through 6/30/99?

All comments and suggestions are welcomed!

An Employer wishs to terminate it's defined benefit plan that is 75,000 under funded. The Employer would like to deduct the full 75,000 in the year of termination. The plan is funded under the individule aggregate method and the contribution produced under the method is less than the required amount to sufficiently fund the plan for PBGC purposes.

The Employer has changes Actuarial firms in the year of termination. Can the new actuary change the funding method to unit credit and get the full deduction to fund the plan?

Any other thoughts to solve this clients problem.

Thank you.

There is an SPD reporting exception in DOL Reg. 2520.105-5 that applies to "qualified HMOs." Can anyone help me with some basic information about what these are? How would I know if ours is one?

I know the DoL doesn't allow a plan's payment of Settlor Expenses. (I forget the cite, can someone help on this.)

However, is the following rationale correct?

The termination of a pension plan involves two types of activities (and related fees).

The first type of activity is the business decision of whether or not to terminate the plan. The issues to be considered include the cost of termination, the need to fully vest employees, the adverse employee relations, etc. This is a business decision, so I believe the fees charged here could not be paid by plan assets.

However, the second type of activity are those tasks in implementing a plan termination; these are part of the administration and continued qualification of a plan. These tasks include plan amendments (or at least the GUST amendments), the 5310 filing, and the administration of employee notices, elections, and benefit payments. So, I believe these can be paid from plan assets.

Since often the decision-making process is fairly cut & dried ("I cannot afford anything for my employees!"), most of the expenses could be paid from plan assets.

OK, let's hear your thoughts. Any actual discussions with DoL on this? Also, has anyone actually had the DoL object to such payments?

Thanks.

Are people generally aware that if employees can purchase employer stock through their Section 401(k) plans with their own contributions, the sale of those shares to them must be registered with the SEC? I've had a number of clients over the years that offered (publicly traded) employer stock as an investment alternative, without any consideration as to the impact that would have under federal securities laws. While compliance with federal securities laws is not too burdensome, it must be done.

I have been told that in the employee's year of retirement they can shelter up to $13,000 of vacation pay and administrative leave pay that they have not used. I can't seem to find anything on this subject. Could someone please point me to a Code Section or something similiar?

I will try this again. JohnB, please allow us, Quantech users the ability to share our comments in a professional way. Not all things said on this board should be in support of Qtech. Allow the users of this board to comment on my posting. Quantech obviously scans the board and gets very upset when someone has negative feedback about its product.

Below is an e-mail conversation I had with Corbel after I posted a comment on this board about “MY OPINION” “ on how well Qtech handles the needs of a daily shop (see earlier post regarding moving from Datair to Qtech). This board is not affiliated with Qtech and should be available for users to express their opinions. I have taken off the name of the individual from Corbel who sent the following e-mail to my attention in hopes that the moderator of this board will allow the post to stay. Also, below is my reply to that email. Have a nice day!

DailyK

----------------------

From: "Daily Operations"

Date: Thu, 24 Jun 1999 07:57:52 -0700

To: "John Doe"

Well here you go. First, I find it quite humorous that you have written me this email. If you are so sure that your product is the best in the market why would you be concerned about my comments? Constructive negative feedback should only be used to make changes that your users need.

To answer you first question. Yes, my shop uses both Quantech & TrustMark. I have used it in the past and I am using it in the present, and I will be using it in the future. I too attend a majority of your users group. Not only nationally but also the smaller regional groups. I am aware of how many shops currently use the product. Simply because you have 110 firms using Quantech for daily recordkeeping does not mean its a great system and does not need enhancements.

1) Forfeitures do not work correctly. They are not included in gain/loss calculations. They are not included in fee calculations. This becomes a manual process. It needs to be the default fund in the current version. To forfeit a participant you need to drop a contribution? Can not forfeit and distribute at the same time (negative units). They require a $1 par fund to be used which must be a cash account on Qtech. When you reallocate at year-end, it pulls the current balance. You can only have one suspense account.

2) Eligibility is horrible. If you elect to check the first box, you change the world. The system seems to calculate correctly sometimes and not correctly on other occasions. My administrators seem to mess with plan specs constantly to figure out the logic behind some of Qtech's decisions.

3) To use the VRU you need to either be eligible or have a balance on the system. Not good for the high tech automated world trying to supply better customer service and allow for online enrollment. Unable to swap the database at the plan level, either all plans or nothing.

4) Qtech does not have a trust accounting report! I know, you have been working on it for quite some time now. This is a must in daily! Cash is not tracked for reporting purposes.

5) Employee census information is sorted by effective date rather than trade date. Trade date is used in daily.

6) Activity tracking is non-existent, or at least not very good.

7) Loan interest updates are manual. Does not allow the user to tell the system what interest rate should be used on new loans. (Ex. prime 1) Should be a global level transaction to populate interest at the plan level. Loan modeling does not use the current payroll schedule. Unable to drop a loan fee and loan distribution at the same time. Loan repayments settle on the loan fund at the time of posting; should be on trade date, this can cause straddled transactions at quarter and year-end.

8) No good reconciliation reports available. Nothing at the omnibus level for daily reconciliation.

9) Takeovers are difficult. Required fields to populate with year to date information for testing is impossible unless you back in to the takeover through transactions. Unable to populate hardship information.

10) Census DER - hard to find the accounts you really need. Fund names are cut in half, no account numbers. Reports for contributions run through the system do not show employer match amounts. Unable to view 32 bit file names. Unable to pick a date to extract out ending balance, units or cost basis etc.

11) After you post a transaction, you loose the ability to scroll within that transaction to see what was done. In order to find out the funds used on a transfer or gain loss, you first must reverse the transaction in order to see what was done.

12) No good hardship distribution capabilities. Needs to be done manually in the current version.

13) No ability to use "as of" dates for transactions. Need to flip back in forth between plan years to run the transactions. Then you need to update the current year to reflect proper balance. Census (name, address, vesting changes, dates, etc.) is not carried from one year to the other if changes are made in the prior year. This happens in daily when running in the last file for the previous year which is received after the new year is established. If investment elections change in the new year via VRU or web, last contribution for the old year will not reflect correct allocation.

14) Not able to drop a negative contribution for employer match.

15) Fund prices are wrong sometimes with no corrections by Qtech if using your download.

16) Unable to identify what trades belong to what transactions.

17) 5500 reports?

18) Only one user is allowed in the plan at a time. Should at least offer view only capabilities.

19) Employers with multiple pay schedules can run into problems if the payrolls end on the same date.

There are many more things I could come up with, but these are just a few off the top of my head. Qtech does do some very nice things also, but there are needs for enhancements. Future version may make it the system of choice. Until then I must remain true to my opinion that the system does not handle daily as well as others currently.

Also, just because users are pleased with the system does not mean they do not encounter problems. I am pleased with both TrustMark & Qtech but would like to see enhancements to both.

Best Regards,

Daily

----------------

On Wed, 23 Jun 1999 15:43:31 John Doe wrote:

[Note: several paragraphs have been edited (deleted) by me, the webmaster of these message boards -- please see my message later in this thread -- thanks -- Dave Baker]

[Note: This message has been edited by Dave Baker]

Can a person who has already begun to take substantial equal periodic payments contribute to that IRA even if he has chosen the RMD method?

Plan sponsor neglected to file Form 5500 for calendar plan year 1991 and 1992. Oops!

In 1994, this was discovered, and after discussions with the IRS (who were very amenable to the client sending the forms with an explanation), the client sent in the filings. (let's say this was done in October 1994).

Neither the client nor us received any response from the IRS in Atlanta area after the filing was sent it.

As a practical matter, they are most likely fine.

Technically speaking, what is the statute of limitations beyond which time the IRS cannot assess the $25 per day fine. Is is 3 years, 5 years, 6 years, or other? Does it run from when the filing was due, or when the filing was made?

Technically speaking, any thoughts?

When does Social Security Disability constitute Medicare entitlement, for purposes of a second qualifying event and/or COBRA cutoff? I have heard of a rule that a person receive SS disability payments for 24 months but cannot find this in writing.

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A company has had a profit sharing plan for many years and the contribution made in the January following the plan year end typically equals about $1,000,000.

This year, they had some extra cash sitting around in July and so they contributed $900,000 to the plan which was invested in a money market account. By the time January rolled around, this $900,000 contribution had grown to $1,000,000 which equalled exactly the contribution required under the plan for the previous year (not probable, but just go with it).

My questions are:

1) Is this legal? The $100,000 of earnings in the trust is basically tax free. If the company had put the $900,000 contribution in a corporate checking account and it earned $100,000 there, the company would incur $100,000 of taxable income. If prefunding was legal, it seems like too good of a planning technique for the company - - the company prefunds the contribution early in the plan year and then uses the tax free build up of the earnings to offset the company's contribution. I understand that the company would also be required to make up any difference if the value of the $900,000 decreased during the year, but given the performance of the stock market in the last couple of years, prefunding would have been a good bet.

2) Is the company allowed to use the $100,000 of earnings to reduce their required/discretionay contribution? Or must the company actually fund the full $1,000,000 contribution - - in other words, they make a deposit of $900,000 in July and then another deposit of $100,000 in January. If this is the case, what do you do with the $100,000 of earnings?

3) Must the plan document have enabling language for the company to prefund?

4) What other issues (i.e.-415 and 404) should I be aware of if a company is using prefunding?

Thanks for any help.

ERISA section 3(40)(B)(iii) explains how to determine whehter two or more trades or businesses are treated as employed by a single employer for purposes of a MEWA. The very last section of the parargraph indicates that "except that, for purposes of this paragraph, common control shall not be based on an interest of less than 25 percent." Can anyone explain what the "less than 25 percent" is referring too?

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Can I contribute the max $2000 per year into a Roth IRA and also contribute the max into my company sponsored 401k simultaenously? (I'm not yet participating in a Roth IRA or a 401k)