In a recent discussion with another practioner, I heard about this method for correcting a failed ADP for one HCE : the HCE requests his/her w-2 corrected for the year in question and the plan administrator deems the excess to be an advance contribution for the next year. Has anyone used or heard of this approach ?

There sure seems to be an awful lot of confusion out there about Roth IRA conversions/ Transfers. We, the custodian of a Roth IRA, sent a conversion request on behalf of one of our investors to the trustee of her traditional IRA requesting that they transfer it to us as a Roth Conversion. The form she signed clearly indicated her intention to convert the traditional to a Roth and our letter clearly indicated we would accept the transfer into a Roth IRA. However, the transferring trustee is now telling her that they will not issue a 1099-R because they are treating it as a trustee-to-trustee transfer between traditional IRAs, a transaction which is not reported to the IRS at all. They are telling her we should have transferred the money into a traditional IRA and then done the conversion for her to a Roth from there. This seems a pointless waste of time, energy and paperwork since our conversion form and acceptance letter were clear that she was requesting a distribution from her IRA with the intention of converting to the Roth (the hope being that the 1099R would show premature distribution with an known exception to the penalty). Has anyone else run into similar situations? Are there any logical explanations for this approach?

Do you know of any conferences or training materials dealing with non qualified plans.

Can contributions to a Roth IRA come from distributions of a 457B plan. I'm retired with no other W-2 income.

I tell clients that it's a provision where the IRS acknowledges the fact that your SS benefit decreases as your income increases. The integration is the level of income you pick to determine which employees you want to receive a "larger piece of the profit sharing pie."

Also tell them that it is one of very few qualified plan provisions that permits the plan to favor the highly paid people (as long as they stay within IRS guidelines of course).

Is the portion of an defined contribution account balance attributable to a direct rollover includible in the account balance for the cash out rules?

Does anyone out there have any expereince designing/implementing any sick and/or vacation donation programs? A program where an emp. can donate hours to another emp. due to a serios illness, etc.?

I am looking for any rulings, cases, precedents where a court has used a literal reading of a Plan document and SPD, where the intent was clear but contradictory to the Plan.

Specifically, in a Plan using an Offset where the Offset was improperly named.

Is there a 404© risk to an employer if the employer recommends that retiring employees roll their plan distribution to a particular company's IRA annuity program? It would seem to me that the employer is assuming SOME sort of liability if they endorse a particular company in communications given to employees at the time that they are receiving the usual information packets and notices at the point of separation from service. Is it safer for the employer to make no recommendation or to provide information on several IRA companies rather than one company?

We administer a plan where the plan sponsor has been over reporting hours for the last five years. Many participants who did not work 1,000 hours were reported as doing so, and incorrectly given a year of vesting service. About 30 former participants are involved with total overpayments of approximately $8,000. Total plan assets exceed $1,000,000, so no single participant is significantly impacted.

What is the proper correction method? Is the plan sponsor required to attempt collection of small sums of money from the overpaid former participants, even if they could be found? If the sponsor elects to deposit the overpaid amounts, is the contribution deductible? Would earnings need to be paid on the deposited amounts? Would all prior years with excess distributions need to be reallocated? The problem has been corrected for the past year. Can the sponsor simple ignore the excess payments? Thanks.

A sole proprietor(SP) has net se earnings(net of 1/2 SE tax and plan contributions) in excess of $160,000. Also has other common-law employees. He has a profit sharing plan integrated with SS at 100% of TWB. If we calculate the max contribution under code sec. 404 and allocate in integrated manner, SP receives $25,546.99 of the total allowable contribution of $34,105.04. Is this correct or is the SP's allocation limited to 15% of $160,000 ($24,000) because he is a SP.

Could someone tell me the difference between Non-Registered Seperate Accounts and Collective Trusts? and with which plans they would be used(401k, 403b)? Also, are Non-Registered Seperate Accounts..... insurance products ?

By now, most benefits managers running flexible benefits programs and/or offering multiple health benefit options have had a chance to summarize their firms' fall enrollment season results.

In my experience, those results make great 'tea leaves' for emerging industrywide benefits trends.

If you're close to the benefits elections data at your firm, how about sharing your results with us? No need to name names, or even provide numbers - just your take on what the patterns foretell.

Company A acquired a division of Company C, an unrelated entity. Some of the employees of the division who were eligible for retirement under Company C's plans retired from Company C prior to closing, so that they could begin receiving their pension benefits and begin coverage under Company C's retiree health plan. After the acquisition, some of those "retired" employees went to work for Company A. Company A reimburses those employees for a portion (but not all) of the premiums they must pay to Company C for their retiree health coverage.

Question: Has Company A established a "welfare benefit plan" under ERISA? In other words, is the mere reimbursement by an employer of a portion of the premiums paid by employees for health insurance which is not provided by the employer a welfare plan?

Any thoughts would be much appreciated.

This may be more of a compensation question, but I'm interested in any ways partnerships have found to compete with corporations that can offer stock options to employees as well as having stock in their DC plans or stock purchase plans. What have they done to create a sense of ownership among non-partners and how have they replaced this in the total rewards (total compensation) equation?

The IRS today issued final Roth IRA regulations.

Here's a link to their full text, in hypertext format, provided by BenefitsLink:

http://www.benefitslink.com/taxregs/1.408A-final.shtml (click)

This topic is "locked," which means you can't post a message in this topic. This message is only intended to serve as an anchor to the full text of the final regs. To post a message about the final regs or any other Roth IRA topic, just click on "Start a New Topic" below.

[This message has been edited by Dave Baker (edited 02-04-99).]

What guidance is there regarding charging a nominal fee for the processing of a QDRO? Can we do this? Is there a max we can charge? Any information will be appreciated.

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A privately held corporation will be setting up a profit sharing plan. Somewhere between 10% and 50% of the Plan assets will be invested in the stock of the corporation.

Can the Plan meet nondiscrimination rules using cross testing? For example, can the Plan use an age-weighted allocation in its allocation formula?

We are currently filing one Form 5500 for our Cafeteria Plan. Our plan includes the following: Dependent Care Reimbursement, Medical Reimbursement, Health Insurance Premiums, and Group Life and Disability Premiums. We have over 100 employees, and some of these plans have over 100 participants. Do we need to file separate 5500's for these plans?

We have some employers whose plans were started some years ago who have the Joint Survivor Annuity built into it. Is it possible to remove this with an amendment if that is what the employer or trustee wants?