The 1999 Instructions for Form 1099 et al notes that for Form 1099R, they have eliminated Distribution Codes B and C due to the repeal (on 8/20/1996) of the death benefit exclusion. They do not, however, give any guidance for how to treat beneficiaries of plan participants who died prior to the repeal date. Has anyone heard anything further on this issue?

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Bill Ruppenthal

Are IRAs required to permit in-kind distributions?

Is there any specific liability for an insurance company's failure to offer COBRA continuation coverage to an employer with fewer than 20 employees? The insurance company provides regular group coverage for the employer but will not provide COBRA coverage despite the fact that the employer's controlled group includes a foreign parent with well over 20 employees. Any thoughts?

I have an employee who is not currently actively on work. He is on disability and it is likely the illness will be fatal. I understand that the disability coverage goes with the insurer, so as long as the employee is not actively at work, the current insurer is responsible for disability claims even if we switch carriers.

How about for life insurance. I ask because we will be required to make a change in life insurers because size limitations will require us to shift. Is the prior life insurer still on the hook as long as the employee does not return to work?

Can anyone recommend any reference material for information on calculating earned income for a sole proprietor or partner in a 401k plan? We have a few clients in this situation. The complexity seems to rise significantly when they want us to calculate the maximum match for a partnership. This creates the ol' circular reference problem since their income is reduced by the match which is based on their earned income. Right now, I'm just looking for reference material. If any of you are interested in the gory details, email me.

Does a qualified plan have to file a 5500 with an audit attached for it's first plan year if the participant count is over 120?

Is anyone answering "yes" to questions 27e & 27f on Form 5500, attaching a Schedule, filing Form 5330, and paying the prohibited transaction excise tax for 401(k) monies deposited more than 15 business days after the month-end withheld?

[This message has been edited by Kelly R (edited 07-21-99).]

Notwithstanding the cross-references in section 414(B), ©, (m), and (n) back to section 408(k), is it possible to use an individually designed SEP to limit the participation in a SEP to less than all of the employers within a controlled group? While this seems to fly in the face of a literal reading of the participation requirements in section 408(k)(2), why are the instructions on Form 5305-SEP worded the way they are in item 5 of the "When Not to Use Form 5305-SEP" section?

Has anyone come across any authority that would allow a limited liability company to grant options to employees for its LLC units that would be taxed as incentive stock options under Code Section 422? A strict reading of Section 422 leads me to the conclusion that an ISO can be granted only by a corporation and only with respect to "stock." Thanks for any help.

the recordkeeper for my company's 401(k) plan incorrectly allocated the ER match 2 years in a row. on both occasions, they have corrected those participants who rec'd too little match. those who rec'd too much match, who were not HCEs, lucked out.

my question is: can my company, the plan administrator at my company, or the plan be held responsible for these mistakes by the recordkeeper/TTEE? what would the IRS or the DOL do to us? thanks for any light shed on this subject!

For church organizations which may be trying to compare the advantages and disadvantages of 401(k) and 403(B) plans , I've posted a chart comparing the two types of plans.

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Employee benefits legal resource site

For governmental and other tax-exempt organizations which may be trying to compare the advantages and disadvantages of various types of plans which provide for voluntary pretax contributions, I've posted a chart comparing the three types of plans.

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Employee benefits legal resource site

[This message has been edited by CVCalhoun (edited 03-06-2000).]

For anyone who may be trying to compare the advantages and disadvantages of various types of plans which provide for voluntary pretax contributions, I've posted a chart comparing the three types of plans.

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Employee benefits legal resource site

Will change of Profit Sharing Plan's plan year, which will result in a short plan year, have any effect on the allocation of the employer's contribution on a cross-tested basis????

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This item asks for transactions or series of transactions that exceed 20% of plan assets. From the "exceptions" in the instructions it is not clear to me if you count transactions or series of transactions in mutual funds. If you do it seems that most plans that have a money market fund would have a reportable item here because it would not be hard to have the aggregate trades exceed 20%. Is this what the service is looking for in this question?

For anyone who may be trying to compare the advantages and disadvantages of various types of plans which provide for voluntary pretax contributions, I've posted a chart comparing the three types of plans.

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Employee benefits legal resource site

DOES THE ACT CLARIFY THAT: "ELIGIBLE ROLLOVER DISTRIBUTIONS" OF SALARY REDUCTION CONTRIBUTIONS, within the meaning of sections 402©4 and 403(B)8, ARE NOT SUBJECT TO THE EARLY DISTRIBUTION TRIGGERING EVENTS OF SECTIONS 403(B)(7)(A)(ii) and 403(B)(11)?

[This message has been edited by jlf (edited 07-21-99).]

[This message has been edited by jlf (edited 07-21-99).]

We are terminating a 401(k) plan with the IRS. The Plan has participants that terminated years ago (nothing to do with reason for plan termination). Can funds be distributed to the terminated participants during the IRS review of the Plan to determine qualification upon termination?

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We have a facility in San Francisco and the city will allow bus fare as a pre-tax benefit. We have a section 125 plan. How do we handle this new pre-tax bus fare? Can we do it? Any thoughts out there?

Are employees limited to 15% of salary or can an employee designate a fixed amount each payroll (eg $500 per check)that maybe more than 15% but still within the annual 99 limit of $10,000