say a plan makes a mistake in a participant's pension. Is there a statute of limitations to protect the plan sponsor? I have thought that it might be 6 years, since my understanding is that a plan need keep participant records for 6 years. Anyone have any comments or knowledge in this area?

My understanding is that current regs provide that if a plan does not provide notice of suspension of benefits, then they must provide for the greater of the actual accrued benefit at late ret. or the act. equiv. of such ben. Any other thoughts?

For anyone who is interested, I now have a summary of the recently passed tax bill at my site. Although Clinton is almost certain to veto the bill, the bulk of the benefits provisions are likely to reappear in whatever tax legislation is passed this year.

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Employee benefits legal resource site

For anyone who is interested, I now have a summary of the recently passed tax bill at my site. Although Clinton is almost certain to veto the bill, the bulk of the benefits provisions are likely to reappear in whatever tax legislation is passed this year.

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Employee benefits legal resource site

Deceased 401(K) participant listed beneficiaries as #2 minor children (under 10 years old). The company sponsor has been approached by a person claiming to be the mother of the beneficiaries. What verification of guardianship for these #2 beneficiaries should the company request to sign off on and forward the distribution request? The deceased participant had been divorced for many years before joining the company & the plan (i.e. no person can really verify if these are the children named, or their legal guardian).

Can you claim Electrostatic Air Filters ($150.00)for an air conditioner for acute allergies as a reimbursable expense on your 125 account? Could this be classified as a capital expense?

Thank you for your imput.

This is more of an accountant question, but does anyone know if employee elective deferral amounts are deducted on Line 19 on the Schedule C since they are considered employer contributions for deduction purposes or are they considered part of the wages line on the Schedule C. Any help, particularly with cites would be appreciated. Thanks.

Do you provide medical benefits for part- time employees? If so, what is the criteria for being eligible (i.e. minimum number of hours worked, etc.) and what premiums are charged (i.e. same as full-time employees). Lastly, what was the incentive to offer these benefits (i.e. competitive reasons, large part-time population,etc.)

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What are the most frequent methods of providing a plan to make those affected "whole"? Non-qualified lump sum payment at retirement? Annual cash out?, etc. Will the limit be increasing in 2000?

Thanks.

I'm dealing with a plan that did not make RMDs for 1996 and 1997 to two employees who attained age 701/2 in those years. Because of changes made by SBJPA, employees who are still working and aren't 5% owners are not required to take distributions. However, according to the IRS, a plan cannot take away the option to take a distribution at age 701/2 because it is a protected benefit. The Irs published Notice 97-70 which gave employers until December 31, 1997 to offer employees an election to defer. Our employer did not provide the election until December 28, 1998. (Both employees opted to defer).

I originally thought that this was a failure to make a RMD subject to excise tax and so on. However, upon furthere analysis, these employees were not required to take distributions under 401(a)(9) because they were still employed. The failure was that the plan did not follow its own terms and make distributions when the employees turned age 701/2. Do you agree with that analysis?

if so, would the proper correction be to make the required minimum distributions for the 1996 and 1997 years based on the terms of the plan? Would earnings need to be calculated and added into the minimum distributions?

First, I would like to thank Noel for his outline on required minimum distributions (RMDs). I spent part of the weekend studying the outline and I think I have a handle on the calculation.

Unfortunately I'm dealing with a plan that did not make RMDs for 1996 and 1997 to two employees who attained age 701/2 in those years. Because of changes made by SBJPA, employees who are still working and aren't 5% owners are not required to take distributions. However, according to the IRS, a plan cannot take away the option to take a distribution at age 701/2 because it is a protected benefit. The Irs published Notice 97-70 which gave employers until December 31, 1997 to offer employees an election to defer. Our employer did not provide the election until December 28, 1998. (Both opted to defer).

I originally thought that this was a failure to make a RMD subject to excise tax and so on. However, upon furthere analysis, these employees were not required to take distributions under 401(a)(9) because they were still employed. The failure was that the plan did not follow its own terms and make distributions when the employees turned age 701/2. Do you agree with that analysis?

if so, would the proper correction be to make the required minimum distributions for the 1996 and 1997 years based on the terms of the plan? Would earnings need to be calculated and added into the minimum distributions?

Kurt

50yr old, divorced, 700K in property, 300K in investments, 101K in Roth, 3K/mo in child support. All $'s as property settlement so no taxes on them. no other income. Should I be in a Roth?

Can anyone tell me, either from personal experience or from national statistics, at what rate 401(k)plans fail the ADP/ACP tests?

Thanks.

A traditional IRA is converted in full to a Roth IRA at the same custodian in 12/98. The account includes mutual fund shares that are ex-distribution at the date when the custodian records the transfer of assets into the Roth IRA. The distribution is received in January 1999, but would be includible in 1998 income for a taxable account. The custodian omits the value of the distribution receivable from the 1099-R for 1998 and reports the amount of the distribution as a separate conversion in 1999. The account holder may be ineligible to convert in 1999. Is the custodian in error, and should it have reported the full value of the account as converted, including distributions receivable? Thanks in advance for any responses.

I am new to the world of investing, other than my 401K. I am interested in opening a Roth IRA, but am not sure where to start. Any ideas?

I have been offered a sales job with a medical company, and they pay (reimburse) .12 per business mile. Is this fair? What is the industry average? Thanks!

Is the medical premium taxable to the employee if the (so-called) domestic partner does not qualify as an eligible dependent under IRS code 152?

I am working with a client who has a Standardized Profit Sharing Plan. He has approx. 25 employees but 18 of them work only during the summer months. 16 of the 18 consistantly work over 1000 hours but are not employed on the last day of the year. We are looking to convert the plan to a Nonstandardized Profit Sharing / 401(k) Plan with a last day of the year eligibility requirement. The Plan is Top Heavy. If we make a profit sharing contribution, will we be required to make a top heavy contribution to the 16 summer help employees (who work over 1000 hours) who are not employed on the last day of the year? If we make a matching contribution to the 401(k) plan, must we match the summer help employees? If it is important, most of the summer help are hired back each year. Thank you!

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[This message has been edited by SPollock (edited 08-14-1999).]

I have a client with 30% spanish speaking workers. According to the SPD regulations, that means the employer needs to create a Spanish SPD. Does anyone know of a service that specializes in these. Due to the technical nature of an SPD, I would be a little concerned about using someone who does not have any employee benefits knowledge. Obviously, I won't be able to review the document.

Kurt

A substantial amount of confusion, post-Harris Trust proposed regs, seems to exist in California, relative to what (if any) level of fiduciary liability an insurance company assumes when a separate account is used by a 401(a)qualified plan. If it is possible, could we get some clarification as to whether a governmental plan has any possible recompense in the event a separate account is not invested according to State or federal law? Please address on both a stand alone contract and a trusteed plan basis.

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