My firm handles marketing and administration of 401(k) plans, currently offering a selection of nine funds to our participants. The funds are not publicly traded (I believe the term is "Class C.") We are considering the addition of some publicly traded mutual funds. Can anyone offer some guidance on the different areas we should concern ourselves with during the planning phase? Of course, I understand that we will now have to comply with requirements regarding prospectus availability, but what about required certifications for any of our staff? Also, if we replace an existing bond fund with a new bond fund, what kind of notification and disclosure requirements are we looking at? Are there compliance issues that I should consider when eliminating a fund option and moving all assets from the eliminated fund into a newly selected, similiar, but not identical, fund. Any references suggested would be extremely appreciated.

participant received his distribution from a 457 plan and rolled the balance into an IRA. We now discovered this problem, what are our options? what do we do with the money?

TAKING OVER DR'S OFFICE WHO HAS CALENDAR YEAR MP AND PS PLANS. VIA RESOLUTION, MP PLAN FROZEN 12/31/98, MERGED INTO PS 1/1/99. FINAL REQ'D MP CONTRIB FOR 98 WAS MADE IN 99. PS PLAN AMENDED FROM PROTOTYPE TO INDIV DESIGNED NEW COMP EFFECTIVE 1/1/99 (DOCUMENT INCLUDED LANGUAGE INDICATING MERGER). PRIOR ADMINISTRATOR FINISHED 98 ADMIN TODAY. WE WANNA MOVE ON THE MERGER.

1. IS THE PROCEDURE OK?

2. IF INDIV. ACCOUNTS, CAN THEY JUST BE RETITLED UNDER PS PLAN AND FINAL 5500 FILED FOR 99?

3. IF POOLED ACCOUNTS, IS A FINAL ALLOCATION REQUIRED LIKE IN A PLAN TERMINATION, THEN MONEY TRANSFERRED INTO PS PLAN UNDER INDIV. ACCOUNTS?

4. ANYTHING ELSE I NEED TO CONSIDER?

THANKS IN ADVANCE FOR YOUR RESPONSE!

Is "Includible compensation" for purposes of the 403(B)(2) exclusion allowance limited to the 401(a)(17) compensation cap (currently $160,000)? Example 20 of the updated IRS Examination Guidelines for 403(b)plans indicates that "Compensation" for 415 limit purposes is limited to $160,000, but is seemingly silent with regard to 403(B)(2).

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Mike W.

An employee worked for her employer from 10/1/96 to 9/30/97 and was laid off due to a cut in funding. She was never a "participant" due to the fact that entry dates are 7/1 and 1/1. She has just been rehired. Am I correct in telling the employer that she must wait a full year again before becoming eligible because she had a break in service -- even though she did not quit and wasn't fired?

In Section 13.5.1.2.1 of the updated Examination Guidelines for 403(B) Plans, it is stated that, in theory, an employee who has completed 15 years of service with a qualified organization other than the one at which he/she is currently employed could use the full amount of the 15-year "catch up" election under 402(g)(8) with respect to the current organization. This seems to contradict 402(g)(8) and at least one well-known 403(B) publication, which indicate that the 15-year "catch up" election can only be utilized at the employer for which the 15 years of service had been performed. Which interpretation is correct?

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Mike W.

Am I correct in understanding that an employer can change the dollar amount that they match at any time if they have a "discretionary match"? More specifically, this employer's plan doc says that the employer will make a discretionary match not to exceed $520 per year (which equals $10.00 per week). They would like to increase it to $15.00 per week which would be $780 maximum for a full year. Can this be changed any time?

Can Safe Harbor contributions be made in a combination of cash and employer securities, or must such contributions be made solely in cash?

If the IRS Notice 98-52 are adopted by a plan, must the "safe harbor" contributions be funded as frequently as elective deferrals, or can such contributions be funded on a less periodic basis?

Found my answer by searching old Q&As

[This message has been edited by Roger (edited 08-03-99).]

I am the marketing director of a large local Phoenix, AZ CPA firm. We do plan audits along with design, administration, etc. I understand that basic plan information is public information. I would like to obtain a list of all the plans in Maricopa county (Phoenix) which require such audits. Anyone know where I could obtain such information? Thanks.

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Steve Parker

My husband left his employer at the end of March. We received the health/dental cancellation notice July 15 and still have not received any COBRA notification. My understanding was that notice must be within 14 days of the cancellation or the event which caused the cancellation. Since we did not receive notification, are there any consequences to the employer?? I think that a three month delay in notification is more than an oversight...

Would really just like some links or something to point me in the right direction.

Thanks in advance...Sheila K

Can a 401(k) plan charge the participant for a distribution?

Small employer is terminating 2 year old 401(k) plan with only one active participant with any account balance. The 401(k) plan apparently (I haven't seen any background docs yet)includes money "fozen" from a previous money purchase plan MPP that the employer sponsored for about 12 years and terminated before adopting the 401(k)(again all benefits were for this one participant).

The paticipant plans to roll over his 401(k) contributions to a new traditional IRA.

Question: assuming his plan distribution includes after-tax contributions that he made to the former MPP, am I correct that he can't rollover those proceeds to an IRA, but could rollover the earnings on those contributions?

Anyone willing to share any thoughts on how the former MPP controbutins are treated or options?

Thanks

On a previous message I read about companies that are selling debit cards for use by FSA participants.

Do you have any additional information on this or know of the names of any companies that are doing this?

Also, how does this effect/change the role of the TPA?

Some of my clients have opted out of employer health Ins. since covered on spouses plan. Employer Has always paid them money in lieu, BUT, mandated that it go to the 401(k) and sit till they retire (not evfen available if over 59 1/2!). Also, employer now states that this money approx $2,000 per year is to be treated like a voluntary sdalary deferral and lowers what they may put in 401(k) or 403(b){yes, they are a 501C3, with an old 401(k) also}. My clients want this money to be paid to them directly and not aaffect their MEA.

I know that the employer doesn't have to pay for health premium not used, but since they do, must it be restricted, etc.?

Some of my clients have opted out of employer health Ins. since covered on spouses plan. Employer Has always paid them money in lieu, BUT, mandated that it go to the 401(k) and sit till they retire (not evfen available if over 59 1/2!). Also, employer now states that this money approx $2,000 per year is to be treated like a voluntary sdalary deferral and lowers what they may put in 401(k) or 403(B){yes, they are a 501C3, with an old 401(k) also}. My clients want this money to be paid to them directly and not aaffect their MEA.

I know that the employer doesn't have to pay for health premium not used, but since they do, must it be restricted, etc.?

In the first year of the Plan an Employer allowed two employees to withdraw their 401(k) contributions without hardship paperwork and allowed them to continue to contribute to the plan.

Is this correctable?

What would be the method of correction?

Can anyone recommend a good text on ESOP administration?

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Any thoughts on whether an employer's payment of a housing allowance for a foreign assignment is includable as FICA wages, even though it is excludable from income tax under IRC 911? I believe it would constitute FICA wages, since I cannot find any applicable exclusion from the FICA wages definition. On the other hand, I have searched various IRS publications and instructions (other sources, too), and can find nothing in the affirmative. Thanks.