In regards to both employer & employee contributions to a 403(B) plan when must the payments be made. The fiscal year of the company is calendar. Employees do have monies withheld to be deposited into the plan on a semi-monthly basis.

OK - crunch time. I need an explanation with question #13 from 06/04/98 test.

Question:

What is the maximum deductible contribution on behalf of the sole proprietor for 1997 (rounded)?

- calendar year money purchase

- 10% contribution

- sole proprietor's earned income before any deduction for contributions and self employment tax is $150,000

- eligible compensation for employees - $47,360

-self employment tax is $12,000

Answer - $12,660

HELP!!

A Roth IRA is used to fund a credit shelter trust. Distributions are made from the Roth IRA to the trust. The financial institution issues a 1099-R, noting it is a Roth IRA. The distribution is not taxable since it is a Roth IRA. When the trust distributes the money to trust beneficiaries and issues a Schedule K-1 (Form 1041), is the distribution to the trust beneficiary taxable? Is this taxable or nontaxable status noted on the K-1?

If an Employer uses a nonstandardized 401(k) document (and also has an ESOP),

and chooses the Election Not to Participate option, can they include this option on their deferral election

form? Example: "Pursuant to Section 2.08 of the ABC Co., Inc., 401(k) Plan document, I do not wish to participate for the Plan year ending 12-31-99." Any

foreseeable repercussions?

We're debating whether to count earnings on rollovers for top heavy purposes. Arguments on both sides; regs allowing exclusion of rollovers from TH test don't mention earnings.

Any comments?

We're debating whether you count earnings on rollovers for top heavy purposes. The regs that allow exclusion of rollovers don't mention earnings on them. And with today's market, some rollovers throw off LOTS of earnings each year.

We have people on both sides. Comments?

I've done my homework and it's obvious what happens if you convert a traditional IRA to a Roth - then realize later that you're not eligible (recharacterize back to traditional).

But what if I open a Roth IRA, contribute $2,000 and then later find out that I do not qualify. Can I just cash out the contribution and gains - and pay taxes on the gains ??

Thanx in advance - Kingman

If a governmental defined benefit plan is terminating and wants to pay lump sums, are they subject to the 417(e) rates or can they pay at any reasonable rate?

Calendar year profit sharing plan. All employees are terminated toward the end of 1998. Business has filed for bankruptcy.

Profit sharing plan will terminate in June 1999, and file with IRS for determination. Client would like to hold off on distributing benefits until end of 1999, when favorable IRS determination letter is expected to be received.

Problem -- plan provides that benefits are paid at the end of the plan year in which the employee terminates employment. In practice, benefits have been paid early in the following year (between March and May), when the asset results are known and the allocation is performed.

Can the plan sponsor choose to delay payments until IRS determination letter is received?

(If all employees elect to receive their benefits now and are paid their benefits now, there would be no assets or participants included in the determination letter filing.)

Any help with this question:

1. List 4 reasons why it is difficult to determine if a vertical partial termination has occurred.

2. Why might two practioners come to different conclusions concerning whether there has been a horizontal partial termination?

3. Identify the procedure that a plan sponsor can take to be assured about whether or not a partial plan terminattion as occurred.

Any help with this test question:

Compare a cash balance plan with a traditional DB plan with respect to the following:

A. Calculation of accrued benefits.

B. Earnings on plan assets.

C. Actuarial funding.

D. PBGC coverage.

You must also describe the concept of "definitely determinable benefits" when applied to cash balance plans.

Help!! Beginning attorney with the responsibility of updating and amending plan documents. Any suggestions on where to find information (books, websites, seminars, etc.) concerning the entire process (i.e. what do I do?)My firm sponsors a regional prortype but no seminar or training has been announced yet.

[This message has been edited by DennisT (edited 05-19-99).]

I have converted two IRAs to Roth IRAs, each at a different financial institution. One IRA was a traditional contributory IRA with both qualified and non-qualified contribtions. The other IRA was an ESOP (employee stock ownership distribution). I have transferred the ESOP Roth to the other financial institution and combined it with the other Roth.

Will there be any IRS complications from having combined these two different types of Roth conversions? The institution where I have combined them (Charles Schwab) said this was OK to do.

Thank you.

What typically are the benefits of a Church Plan?

What specific types of programs are you refering to - Dependent Care Assitance? Adoption Assistance?

Recently, my previous employer was acquired by another company. COBRA continuees were not notified of the plan conversion and some received an invoice in the mail charging almost 3 times more than the previous plan charged, this is how they found out that the plan was changing.

Can you help me identify the rights COBRA continuees have in this scenario? Thank you.

[This message has been edited by VFernandez (edited 05-19-99).]

may a participant make a distribution from his 401k plan after he reaches normal retirement age but is still working?

what if the plan doesn't allow for pre-retirement distributions (normally 59 1/2)?

The plan sponsor of a DB plan that currently only covers the sole prop owner wants to transfer a mutual fund into the plan in order to satisfy the minimum funding requirements for 1998. Is this a prohibited transaction as laid out in the Supreme Court ruling of IRS v. Keystone. This case involved truck terminals and property in Key West. This mutual fund is highly liquid. To me this transfer of the mutual fund would be a prohibited transaction as described in PWBA Interpretive Bulletin 94-3. I cannot believe that I have never encountered this situation before.

Is there any federal law which requires that maternity benefits be included in a group health plan?

I am new to this area so forgive me for asking fundamental questions but...under ERISA, what is the definition of a trustee? Under a self-funded plan, is the trustee always the employer? or the plan administrator? or both? Can a trustee be something or someone else than these two entities?

I would be greatly appreciative if a citation could be provided.