Is there a deadline to provide participants in a pension plan ( 401(k & MPPP) a statement of their account balance. PYE 9/30/98. I thought there was a 256? day requirement for SAR. Is there any day requirment for statemnts and what are the penalties for noncompliance?

Does anyone have any ideas on how to close out a terminated Money Purchase Pension Plan if there are lost participants who cannot be found by the search firms? What do you do with the residual assets?

How is your company reacting to the Microsoft case ruling on retroactive liability for employee stock purchase plans under company's benefit plan?

Ron

Contingent Employment Online

www.contingentlaw.com

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www.contingentlaw.com

The May 14 Microsoft case ruling provided the company's common law employees with the right to participate in the company's Employee Stock Option program. Already another group of temporary employees at Pacific Bell has filed a suit for retroactive benefits. Its this starting a trend?

Ron Wainrib

Contingent Employment Law On-Line

www.contingentlaw.com

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www.contingentlaw.com

I am looking for a turn key program for use with an independent contractor sales force. Can anyone point me in the right direction? You can email me at ebarkel@skyfi.com

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Ed Barkel

One of my employees signed up for Dependent Care Reimbursement Account effective 1/1/99 (beginning of plan year). He has just informed me that he thought he could use this money for medical expenses for his spouse, which he can clearly not. The problem arises because the employee does not have any dependents in a day care environment that he can get reimbursed for the money he has already contributed. Has anyone had this situation happen before and if so, how did you handle it? Our open enrollment paperwork goes into extensive detail about how the Reimbursement Accounts work, plus, the employees also receive a confirmation statement which clearly states the elections they have chosen for the year.

Has anyone had any experience with ordained persons participating as employees in a full cafeteria plan?

If they are considered "self-employed" in most situations, are they eligible to participate on a pre-tax basis?

Hi,

I have recently started investigating

retirement plans for our company and have found out there are quite a few options!

I would appreciate any info/links/advice on "How to Choose" the best retirement plan for our business.(i.e.,advantages/disadvantages) We are a family run small business,LLC taxed as partnership, 7 employees (4 partners, 3 employees).

Thanks for your help!

My mom works for a company which offers a PTO, where she earns 0.075hrs vacation time per 1.0 hour worked.

The employee handbook states that if an employee terminates his/her employment, they forfeit time earned. Is that legal ?

This is a Michigan location.

I have a question concerning a safe harbor 401(k) plan with a new comp feature. If a plan elects to use the 3% Qnec to satisfy the ADP safe Harbor how does it effect the new comp calculation. I believe that the Qnec is used in the average benefit percentage calculation to determine top-heavy but is not used in the rate group calculation. However, if the Qnec is classified as a fully vested profit sharing contribution can it be used in the rate group calculation.

All responses are greatly appreciated.

Read all about Roth IRAs at the Roth website but have a question which was not addressed....

I converted my IRA to a Roth IRA at the end of '98. I plan to marry soon and our combined income will then be over $170,000 p.a. Does this mean I can contribute to my Roth IRA up until the wedding date but not after? Or am I supposed to do something else with it?

Thank you for any brief answer to this....

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Brit

I am wondering what vendor provides documents for a Money Purchase Pension Plan that uses the "tiered" or "classification group" allocation method. Thanks for all input.

There is a new service available that uses an automated process to gather obituary information daily. This information is compared to your client list and any resulting matches are sent to you each business day for the final determination if it is a match. The service can be used for both spouses as well as other applications. I would like to hear back on how organizations are presently handling this issue. Are their other applications for this timely, accurate, and complete service that you can see? JIM Burke

Is there any legal responsibility for an employer by NOT auditing Flexible spending account claims submitted by an employee if they are administering the plan themselves? If so, where could I find documentation?

Where can I find a complete list of all the changes in family status for Cafeteria plans? I need to have documentation that would show that a husband changing jobs IS an eligble change in family status to change a health care spending account election.

We have an employee who currently has an election under the Dep. Care Flex but his spouse just started working nights instead of days and he wants to cancel. Same job, same hours... just different shift. It would certainly make sense, but I want to make sure it's within guidelines.

Employee Jane requests a change in her medical election under our Sect 125 plan. She states that her husband has enrolled himself and their children under his medical plan (he recently changed jobs). Jane wants to drop the medical plan for spouse and children but keep her coverage here because it is cheaper.

It would seem to me that dropping coverage altogether would be consistent with her husband's new eligibility as he could add her to his plan. He chose not to.

I'm really on the fence on this one. If I was jane's friend (as opposed to being the decision maker here) I would advocate on her behalf. Any thoughts would be greatly appreciated.

[This message has been edited by Steven7 (edited 06-01-99).]

I just need a quick confirmation on a proposed safe harbor formula. The employer wants to match 400% of 1% of pay. Is this safe harbor? I know that the aggregate match equals 100% of 4% but it does not seem right.

All responses are greatly appreciated.

When we completed the ADP test last year we utilized our right to exclude eligible participants who were not eligible by statuatory requirements (1 yr. & age 21). This moved the ADP % from 5.03% up to 5.33%. If we are using the prior year testing method when completing this year's test which ADP % can I use? Does it matter?

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Robb

I plan to concentrate my writing on different aspects of planning for retirement plan distributions.

My last few articles were on the (now repealed) grandfather exemption from the penalties on excess distributions/accumulations (2/96 issue of Estate Planning), spousal rollovers where the spouse was not the named beneficiary (10/97 issue of Estate Planning) and avoiding the penalty on pre-59 1/2 distributions via substantially equal periodic payments (scheduled for the 12/99 issue of Estate Planning).

Any suggestions as to topics for future articles would be appreciated.

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Bruce Steiner, attorney

(212) 986-6000 (NY office)

(201) 862-1080 (NJ office)

also admitted in FL