Where does one find the "implicit price deflator of the GDP as calculated by the Dept. of Commerce and published by the Survey of Current Business," which is needed to calculate COBRA premiums for self-funded plans under the past costs method??

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

We are an employee benefits consulting firm working with employers with 500 to 3,000 employees located in the NW and in California.

Most of our clients have employees located throughout the US

We have both self-funded and fully insured business. We are experiencing double digit increases in the funding/insured rates. An average would be in the low 20's.

We would like to know what other broker/consultants and employers are experiencing in their locations?

Thank you

What are the ramifications on an employer and its employees if the employer is unable to make its matching (or nonelective) contribution to a SIMPLE IRA due to financial difficulties? This assumes that employees had made salary deferrals during the year, and that an employer contribution is required to be made.

Is there an IRS penalty on the employer if it doesn’t make the contribution? Will the DOL get involved, and what are its remedies? Or is it solely a state law matter?

Further, are there any tax consequences on the employees? (It seems unlikely as long as nothing is distributed.) Thank you.

Does FMLA require an employer to pay holiday pay to an employee while on FMLA if he/she would otherwise qualify for holiday pay?

A Plan has less than $100,000 in assets. It is an S-corportation.

There are two owners (brothers) and several very PT employees.

The only participants in the Profit sharing Plan are the owners.

Can a 5500-EZ be filed?

Or because there are 2 owners (and not owner +spouse) must a C/R be filed?

Employer is experiencing unexpected financial difficulties and can no longer make any matching contributions to the SIMPLE IRA. How does an employer terminate a SIMPLE IRA without triggering the 25% penalty? Can the employer pass a board resolution freezing the plan, wait until each participant was in the plan for two years, then distribute the assets? Can termination/freezing asssets be done mid-year?

If an employee has a lifestyle change due to a new marriage and elects to add the spouse within the 31-day grace period, is the effective date of coverage the date of marriage or the date that the employee makes the election? Is there specific rules in the regulations on this subject or is it by plan design?

Deb: You are correct. Loss of coverage would be a triggering event for a change of status.

Good luck!

Sheila K

In late 1998, I requested that my IRA trustee convert the entire balance of my IRA to a Roth IRA. The distribution from my IRA was effected 12/30/98 and reported on a 1998 Form 1099-R. The trustee established a Roth IRA account for by benefit on 12/30/98. However, the rollover to the Roth IRA was not effective until 1/14/99. I did not receive a 1998 Form 5498 (IRA Contribution Information) from the trustee with respect to the Roth IRA account.

Does this conversion allow me to use the four-year income reporting method?

Has anyone had an experience with HMOs and COBRA? We have several folks on COBRA who have HMO coverage. We have problems getting folks reinstated, terminated back several months on the HMO billing. That is because the HMO policy may only allow say, 30-days or 60-days of retroactive changes. As we all know, the COBRA election period can by law be several months when you add the period the administrator has to mail the qualifying event letter, the 60 day election period, plus 45 day payment period. Are HMOs required to follow same federal COBRA laws? In other words, can they choose not to add a participant back on to coverage even though the law says the participant has a specific length of time to elect coverage?

Looking for a quick reference on the details of the 70½ required distribution laws. Any suggestions?

[This message has been edited by CVCalhoun (edited 08-12-1999).]

Client is a C-Corp with an overfunded, single-participant DB plan. Client is considering setting up a new corporation, transferring sponsorship of the DB plan to the new corporation, and selling the corporation (with the overfunded plan)to an unrelated third party for about 70% of the overfunded amount.

Have any of you had experiences with the above-type of transaction? Is 70% a reasonable amount? Also, what if the client simply terminated the DB plan and distributed the entire amount to the employee? Although this would disqualify the plan, wouldn't it avoid the 4980 excise tax?

Any ideas would be appreciated.

Does anyone know whether the employer is required to withhold for federal income taxes where the employee has died and spouse is entitled to a lump sum death benefit from the employer's unfunded nonqualified deferred comp plan? Reg. Sec. 35.3405-1, Q & A 21 appears to require withholding under section 3402 but at least one IRS representative that I've talked to says there is no withholding obligation. The 1099-R instructions are not particularly helpful in my view but the representative cited to these as her authority that no withholding is required. Any input would be appreciated.

Looking for comments on how many plans per administrator is common. What is the measure of a plan # of participants/frequency of valuations or amount of assets. Let me know what you do.

I am trying to find a good source for information on running a plan with Davis Bacon wages. I have questions such as: when testing Davis Bacon wages in the discrimination tests, could the davis bacon wages be put in with the salary deferral or matching contributions?

I can see where the substantiation guidelines under Rev Proc 93-42 might be useful for very large employers. Are there instances when it might be beneficial for a small employer (less than 100 employees) with a defined contribution plan that allocates contributions based on compensation and/or service to use the substantiation guidelines?

I don't typically check line 21 on Form 5500-C/R and wonder if I'm missing the boat.

As alert readers of this board may already have noticed, my employee benefits legal resource site has moved to a new server. The new address is http://benefitsattorney.com. Do stop by to check out the new site, which contains everything from updated lists of section 415 and other inflation-adjusted limits to how to find out whether participants you cannot locate have died, plus articles and speech outlines on employee benefits. And don't forget the résumé originally published here on BenefitsLink, which was how I originally discovered just how effective this site is!

As alert readers of this board may already have noticed, my employee benefits legal resource site has moved to a new server. The new address is http://benefitsattorney.com. Do stop by to check out the new site, which contains everything from updated lists of section 415 and other inflation-adjusted limits to how to find out whether participants you cannot locate have died, plus articles and speech outlines on employee benefits. And don't forget the résumé originally published here on BenefitsLink, which was how I originally discovered just how effective this site is!

The 401(k) Plan in question has a one yr. of service requirement and age 21, with immediate entry upon meeting these requirements. An ee was hired and terminated with 1997 with less than 500 hours. He was rehired in 1998. What date of hire do we look at and can hours be addes together to get 1000 ?

Company A offers group health coverage to its employees. Company A's wholly owned subsidiary Company B has employees who are covered under a separate group health plan. Company X is purchasing substantially all of the assets of Company B and any of the transferring Company B employees will be covered under Company X's health plan, which has comparable features to Company B's group health plans. Company B's health plans will be terminating. What about the employees for Company B who are not going to transfer to Company X? Those employees will be have a qualifying event since they will be terminated, but Company B's health plan is terminating for everyone (no bankruptcy involved). Any duty to offer COBRA coverage? What about Company B employees who are already receiving COBRA benefits? Do they finish their statutory coverage periods? Does Company A have any liability for COBRA for this minor set of terminating Company B employees NOT transferring to Company X?