Company A will merge with Company B. Company A maintains a multiemployer plan. It appears that merger would not tigger withdrawal liability because original employer still exists. I've reviewed ERISA Sections 4218 and 4069(B). Any thoughts? Thanks.

A client making a nonintegrated 10% contribution to a money purchase plan wants to adopt a safe harbor 401(k). Both plans will be "paired" standardized plans. It is our understanding that the safe harbor 3% nonelective contribution be satisfied in the money purchase plan, but several questions have arisen - Will the current 10% pension contribution satisfy the safe harbor, or must the pension % be raised to 13? Also, participants are required to complete a minimum of 500 hours of service to qualify for a pension contribution, but no such requirement exists for the safe harbor contribution - can this be rectified? Will the minimum funding standard requiring pension contributions be made not later than 8-1/2 months after the end of the plan year also apply to the safe harbor plan?

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I have set up educational IRAs for my children, but they will not accumulate enough to finance the entire cost of their college education.

Can I withdraw a portion of my Roth IRA prior to age 59 1/2 to help pay the costs of their education?

I know a person who is a federal employee w/ the postal service. This person wants his pension reviewed. ERISA provides the emplyee w/ the right to review plan documents in the private sector. Does anyone know of the process in order to review a federal pension/ Or is there any formal procedure and can it be done? Does someone just ask for documents, eventhough there is no formal legislation providing that right?

ERISA sectio 104 provides for an employee to review plan documents in order to check their pension entitlement. I know someone who is a federal employee w/ the postal service. Does anyone know the procedure for getting documents to review the pension from that type of plan. Or if there is anything specific. Perhaps one can request the documents anyway, but the person wouldn't have ERISA provisions supporting them. Any comments appreciated.

Code Section 404(a)(3) limits deductibility of contributions to Profit Sharing Plans at 15% of compensation paid to "beneficiaries" under the plan.

IRS rulings indicate that an employer cannot count the compensation of a participant for whom no contribution is made for the year (e.g., due to a last day of year employment requirement). Their logic is that such a participant is not a beneficiary under the plan for that plan year because no money has been contributed to the trust for their benefit.

Is any one aware of a different rule in the case of a participant in a 401(k) plan? That is - if a participant is not eligible for a PS contribution (due to a last day of year employment requirement) AND that participant elected not to make any elective 401(k) deferrals, is there any chance the employer can count the participant's compensation for purposes of the 404(a)(3) 15% limitation?

The supporting logic would be that the participant is considered to be a beneficiary because s/he had the opportunity to make deferrals. (This is similar to the approach for minimum coverage testing under Code Section 410(B); i.e., a participant is "benefitting" under a (k) plan as long as s/he is able to defer - whether or not they actually elect to defer.) Have you heard any pronouncements from IRS that might support this reasoning?

Thank you for any feedback.

I presume that Client sponsors a DB plan in which leased employees participate and that these leased employees were leased from Company B for some period ending on day X and then leased from Company C from day X+1 to date.

If this is the case, there has been no change in the status of these employees and they should continue to participate without change.

If my interpretation of your situation is not correct, please provide more details (does the message topic "Terminated DB Plan" mean that the plan was terminated?).

If a plan is terminating and will have excess assets, one option is to transfer the surplus into a post-retirement health benefits account. I would like to know exactly what is meant or howi t's designed, with regard to the health benefits account being part of the plan (as a requirement)?

Does anyone have a simplified method of depositing withholding payments where the check is written on a brokerage account and the bank is not local? The local bank will not accept the deposit.

The first year of a new calendar year plan is 1997. The Top-Heavy determination date for the first year is 12/31/97. The only asset as of 12/31/97 is the 1997 contribution of $30K which is entirely receivable ($20K to Key EEs and $10K to Non-Key EEs). For the first year of a plan, receivable contribution amounts ARE included when determining the Top-Heavy ratio, therefore, the Plan is Top-Heavy for 1997 since the T-H ratio would be 66.67%.

For the second year of this Plan (1998), the T-H determination date would be 12/31/97 as well. IRS Reg. 1.416-1 says that you DO NOT include receivable amounts determining the T-H ratio for the second plan year and forward. Since, if you do not include receivable amounts, the account balances as of 12/31/97 for all participants is $0.00. DOES THIS MEAN THAT THE PLAN IS NOT TOP-HEAVY FOR 1998??

(The Top-Heavy equation for 1998 is 0 divided by 0 = undefined.) Common sense leads me to believe it IS Top-Heavy for 1998, since if any amount at all of the 1997 contribution was deposited by December 31, 1997, it would be Top-Heavy for 1998.

Does current participation in a 457 Plan prohibit the participant from electing the VISD under another 457 Plan in which the employee formerly participated? We have two 457 plans available to employees-- it has been asked whether it's legal to allow an employee currently participating in Plan A to elect the VISD provisions of Plan B, where the employee has ceased contributions to Plan B.

If two companies are merging can the survivor company accept the FSA elections from the non-survivor company? Or are new election forms required?

I read in some financial magazine (Kiplingers, I think) that Sen. Roth had introduced a bill that would increase the amount you could contribute to your IRA from $2,000 to $5,000. Does anyone know the status of this bill, or if it is likely to pass? Would increase the limits for 1999 contributions? Thanks.

Currently you can set up a comparability profit sharing plan which relates to class, age and compensation. There is also an age nuetral comparability plan which relates to class and compensation. Does anyone have information on how this works (perhaps a sample spreadsheet comparing both types)and who offers the document?

The breast pump would be medically if the infant was unable to breast feed or failing to thrive. Then its use would be "primarily to prevent or alleivate a physical or medical defect or illness." and can be documented as such by their provider.

I am new to this site and apologize if this topic has been covered recently. We are evaluating plan design changes with the intent of attempting to increase participation in our 401(k).

I recall a year or two ago reading a summary of a study that outlined various plan design issues (i.e. implementing loans, increasing the company match, changing investment options, etc.) and the corresponding impact these design changes had on participation rates. Does anyone have information on this type of study, and if so, how it can be obtained?

Thanks for your help.

What are the rules governing notification of plan participants when a plan is transferred from one provider to another?

I worked for company A and had a loan against my 401K. Company A was going to be acquired by company B so I left. Because of the way the plan was written, I got to keep my 401K there and continue making loan payments directly to the plan.

company A was acquired by company B.

On 12/31/98 I was notified (via a phone call) that the plan was being transferred to a new provider, that I had no choice but to move as the accounts were frozen (the transfer was to take place on 1/5/99) and that I had to either pay off my loan immediately or accept it as a distribution (with associated penalties). I believe I was inadequately notified. Is this legal?

Situation: Fee agreement with client says fees will be reduced by 12(B)-1 fees received, then once fees are reduced to zero, any excess will be remitted to the plan. How can a Third Party Administrator remit these monies to the plan? If possible, how is it treated? Will the money have to be actually paid to the plan sponsor, then the plan sponsor pay the money to the plan? I understand this will cause the money to be treated as a plan contribution and subject to aggregate nondeductible limits and individual limits on allocations. Thanks for any imput.

I am designing a 20 hour retirement planning workshop. Included will be:

1. asset accumulation and investing

2. retiree health care, long term care

3. psycological impact of retiring

4. places to live

5. trust and wills

Any graphs, color pictures, data or ideas would be appreciated.

WalshCEBS@AOL.Com

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WalshCEBS@AOL.Com

Barney Walsh

Upon receiving the Roth Ira during retirement, will I have to pay additional taxes on my money received? If not, could this possibly happen in the future? What part is taxed and when?