I am the author of a book on the importance of asking the right questions in the workplace. I believe the most successful companies and successful managers ask and encourage others to actively ask questions.

If you have a brief moment, I was wondering if you have thoughts about these three ideas.

Do you agree that successful companies have a questioning culture...and if so, is there a company or manager who you think I should talk to about his or her unique questioning style?

What are the five most important questions you should ask about benefits when applying for a job?

I'm trying to find practical punchy questions that the job candidate can ask to make sure they are not missing any benefits they could receive.

Since I understand how busy you all are, I appreciate any reply. I hope you find these questions intriguing...the response from others I have been in contact has been very enthusiastic.

Andrew Finlayson

Author and journalist

Questions That Work: Turning Ideas Into Action

finlaysn@ix.netcom.com

The maximum income for Roth IRA contribution is $150k for married filing jointly and $95k for single. My question is what if a couple making over $150k file tax return separately, can they each contribute $2000 into Roth IRA?

Second question is if a couple find out that their 1999 income is over $150k in 2000, but they each made $2000 contribution to Roth in 1999. What is IRS rule for this scenario? Can they convert the overcontributed portion to a nondeductible IRA, or they have to pay excess contribution penalty?

Thanks for the help.

I am approaching 70 1/2 yrs old..should I switch to an IRA?

A participant was paid out 1/99 based on his 6/98 acct bal. Unfortunately, the 12/98 value was down, so now he must repay the difference (around $340).

the question came up as to whether he must repay the whole $340, or only 80%(since he received a lump sum).

I'm also assuming that the ER must reduce his next tax deposit by the difference.

thanks for any input.

Would like to switch to class allocation by specific $$ for each class. Can anybody provide a sample of employer notification to trustee as to amounts to be alocated to each class? Also, what is the timing of such notification (I guess it is before corporate tax return)?

The IRS apparently requires also the document to incorporate language re above. Would appreciate a sample. Must we amend the doc. or would suffice to incorporate this language in the allocation section of the Adoption Agreement. Thanks for help.

AlexCalin@netscape.net

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Here is a Brain Teaser. Would anyone care to comment?

In performing the 402(g) test, both HCEs and NHCEs have excess deferrals, and received a match on the excess deferrals. The ACP and ADP tests pass without the need for any refunds. Must the company do something with the match which relates to the excess deferrals which are refunded?

Regs under 402(g) say that the excess deferrals of the HCEs are counted in the ADP test, and are also counted for purposes of 401(a)(4), even if refunded. Thus, if the match is not distributed or forfeited, there should not be a discriminatory rate of match under 401(a)(4) because the excess deferrals for the HCEs continue to be counted. (Note 401(a)(4) regs address match relating to ADP or ACP failures, but not relating to 402(g) failures.)

Plan does not say no match is made on excess deferrals. Plan says match made to HCEs attributable to excess deferrals MAY be distributed or forfeited, but does not say match made to NHCEs may be distributed or forfeited. Since there is no discriminatory rate of match, can the related match be left in the plan for both HCEs and NHCEs?

If two employers are not part of a related group, an individual's section 415 limit under plans maintained by each employer is determined separately. Does the same apply for the 401(a)(17) compensation limis? Everything I find refers to the cap as a plan limit. Thanks.

A profit sharing plan without QJSA does not require spoual consent for a participant loan. If a participant borrows 50% of his or her account balance without spousal consent and secures it solely with the account balance, is the loan inadequately secured? Also, even though spousal consent may not be required, do state community/marital property laws still require consent, or are they preempted by ERISA? Thanks.

Is anyone familiar with the current IRS position regarding plans with no sponsor, sometimes referred to as orphan plans?

A company is considering reducing the match formula mid-year, and at the same time changing the definition of comp. to exclude certain types of pay (ex: bonuses). Match is currently calculated and funded once per month, and the change is not anticipated to be retroactive (could it be?). Do both of these fall under the reduction in benefit rules (ie, does the prior match have to be 100% vested now)? Are there other considerations that must be made (I am anticipating ACP testing to be fun)?

Looking for help with the following exam question ****** ER creates a new product line and hires 20 production EE in early 98. All 20 will become eligible to participate in 99. EEs are paid min wage and ER anticipates that few, if any, will choose to defer into the 401(k) plan. ER is concerned that HCEs will not be able to defer the 402(g) limit because ADP test will fail resulting in refunds to HCEs.

Discuss design features of safe harbor 401(k) and how it could meet the needs of HCEs for PYE 12/31/99.

ER is concerned that safe harbor ER contribution is 100% vested and wants to maintain the curent 2/20 vesting schedule for all ER $. Discuss 3 alternative features available in a 401(k) plan which could help to accomplish ERs objectives w/o using safe harbor.*********

Am looking for case info on any Federal District Court and/or Circuit Court dealing with the $100/day penalty for failure to respond to a Participant request for information.

Does anyone know of any recent cases which actually awarded the penalty to the plaintiff? Also, is anyone aware of the Dept. of Labor's position on this issue?

Any help is appreciated.

I recently remember reading that matching contributions can be used to offset the top heavy minimum benefit requirements. Does anyone use matching contributions to offset top heavy minimum benefits. I have read the regs and they seem to state that you cannot offset the TH minimum benefit with the match.

Thank you for your response.

How are short term capital gains handled

if investing inside a Roth IRA?

Thanks!

Rusty

Can someone specify the IRS reg stating that a Roth IRA prior-year contribution must be made BEFORE filing your tax return. If a person files their return in March and decides to make a prior-year contribution to a Roth IRA before April 15th, they are not affecting the amount of taxable income nor the amount of tax due. Traditional IRA contributions naturally must be made before filing, but I've not seen any citation of the Roth IRA falling under the same rule.

Re; PSP/401(k). Employer wants to terminate 401(k) part in mid year.Questionis; to terminate(& amend the adoption agreement etc.) or to freeze 401(k)&401(m) provisons and let each participant acct. with the investment provider until a distribution event?

Thanks for help.

I have recently become self employed and rolled over my previous employers 401K account into a Self Directed Traditional IRA. As of a few days ago, I have requested and received a distribution check from my IRA with which I intend to pay off all my credit card debt. My question is should I take the money I withdrew from my IRA and open a ROTH IRA with this money, then take the distribution from the ROTH and not have to pay the 10% early withdrawl penalty, since I am only 51, realizing that I still have to pay the 28% income tax next year on the Roth distribution?

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Jim

I thought this was resolved about a decade ago!

I just picked up a prototype DB plan that is funded with insurance. They are using a different mortality table for lump sum equivalence for males and females.

When I discussed it with them, they indicated that the Norris decision only applied to plans with at least 15 participants (this plan has three participants), and that they have a 1995 IRS approval.

Did I miss something? Isn't there something in the Code about this?

Meanwhile, I have to calculate a lump sum based on the terms of the plan document, which for now has a different mortality table for males and females!

What did I miss?

Is our adoption assistance program an ERISA welfare plan? I have not been able

to find any DOL advisory opinions on this topic.

Is our adoption assistance program an ERISA welfare plan? I have not been able to find any DOL advisory opinions on this topic.