Does anyone know which Mutual Fund companies will sign the Standardized HH agreements developed by ASBO & NTSAA?

A money purchase plan can be amended into a profit sharing plan. When this is done, there is a potential for reversion to the employer if full vesting is not applied. Specificaly, if the plan provides for the employer to use the forfeitures to reduce contributions, and full vesting is not applied, a reversion will occur.

If a money purchase plan is first amended to allocate forfeitures to avoid this reversion issue, and participants continue to earn vesting credit under the same schedule in the profit sharing plan, do these dollars retain their money purchase character after forfeiutre. For example, if an employee later has a forfeiture of $2,000, and this is to reallocated to eligible participants under the plan, is this $2,000 reallocated still as a money purchase type of money, subject to the distribution restrictions, or does this money lose its money purchase distinction when the participant forfeits it. If it does not have to be retained as money purchase, it could be added to other forfeitures from profit sharing or match, and allocated as one. If it retains its money purchase character, then I will continue to allocate these money purchase forfeitures until the last 100% vested participant finally leaves the plan. Any experience with this type of situation? Thanks.

I have a church client with a relatively large annual budget. The client was interested in enhancing its current retirement program and wondered how much of their budgets other churches used for purposes of providing retirement benefits. Any thoughts. Thanks.

Ten years ago county government adopted a 457 deferred compensation plan prepared by a variable annuity life insurance company and also entered into a annuity contract with the company to allow employees to make contributions from wages/salary to fund the program. Pursuant to then existing Internal Revenue Code provisions, the plan expressly provided that the county is the owner and beneficiary of the annuity contract (even though all the contributions are made from employees' wages/salaries) and that the annuity contract is held as a general unrestricted asset of the county available to the county's general creditors. In 1996 (P.L. 104-88) and 1997 (P.L. 105-34) the Internal Revenue Code was amended to require government employer 457 plans to be held in trust for the benefit of employees and not be available to the government employer's general creditors. Additionally, the plan established a $7,500 annual contribution maximum which has now been increased to $8,000 and is tied to an index. Is there a checklist somewhere (other than the Internal Revenue Code and regs) to indicate the specific changes the government employer needs to make in the 457 deferred compensation plan set up by the insurance company ten years ago and also what changes, if any, that need to be made in the annuity contract with the insurance company to insure that the plan will continue to be a tax deferred eligible plan?

I am looking for information about how DB benefits are typically adjusted to account for the choice between individual and joint benefits. The specific question: Take 2 males with identical work histories, earnings, pension plans, etc. The only difference is that one is married, one is not. Do most DB plans calculate the benefit difference between the two individuals so that the actuarial present value of benefits are the same? Or is there cross-subsidization, i.e., implicit transfers from singles to married couples?

I need this information for some academic research I am conducting.

Thanks for any help or references on this.

Has anybody seen a well-written article about the same-desk rule. I have been looking for something to send to a client (a bright client who knows nothing about the same-desk rule).

I am interested in finding out what others are preparing for participant benefit statements for plans with participant directed accounts with such companies as Aetna an ManuLife. Are you preparing only a statement of vested benefit and an SAR? How complete are your reports to the plan sponsor?

You should obtain a copy of the Plan's Summary Plan Description. This document is required by law to be given to all Plan participants. It should spell out when you may take a distribution. Some plans allow for distributions only after the "anniversary date following termination" has passed. For example, if the Plan year end is 12/31, and you terminated on July 2, 1998, and the Plan has the anniversary date requirement, you would not receive your distribution until some time in 1999. Generally, the Plan sponsor should comply with distribution requests within a reasonable time from request, and also in accordance with the terms of the Plan document. Without knowing the terms of your Plan, it is difficult to give advice to your specific situation. Good luck!

My feeling is that 401(k) loans must not exceed the maturity date unless re-amortized. Am I being too strict or on track with understanding loans?

In a spinoff of a sub, the "same desk rule" applies. Asset sale where ees are termed but sit at the same desk. Spun off sub (New Co.) offers comparable health benefits. So no loss of coverage. But what if New Co. offers an option to waive out of benefits. Is this a loss of coverage if ee waives benefits. If so, who gives notice? Certificate of coverage? What if beneficiaries lose coverage under new plan because New Co.'s coverage costs more for family members, and ee drops their beneficiaries' coverage? Guidance? Rulings?

In a spinoff of a sub, it has been determined that the "same desk rule" applies and the employees that go to the sub will be considered active for a DC plan. Are there related implications for the NQDC plan for employees that go to the sub?

I have several British employees who are on H1B Visas to work in the US. If they can participate in our 401(k) plan, can they:

a) rollover their money if they return to Britain to work? If so, to what?

b) take advantage of the tax savings upon withdrawal at retirement even if they live in the UK? Would they have to live in the US to use the 401(k) earnings at retirement?

Any other experiences with international employees and 401(k)'s?

Thank you.

Dad owns 60% of a company. Adult son "Fred" owns 40% of the company. Adjust son "Jim" owns 0% of the company. All three are employees of the company.

Ignoring the $80,000 pay rule, is Jim an HCE because he is either (a) the son of a 60% owner, or (B) the brother of a 40% owner?

I believe the answer is "yes" because, Section 318(a)(1)(A)(ii) indicates that an individual is considered as owning the stock of his ... parents. Also, Section 318(a)(5)(B) doesn't help (I think it would have helped is the employer were Jim's wife, not Jim).

Am I correct or all wet?

1. In determining the denominator of my ADP/ACP test, do I use:

W2 earnings,

W2 earnings plus 401k deferrals,

W2 earnings plus 401k deferrals plus Section 125 deferrals, or

other?

2. To determine whether or not an employee is an HCE, do I use:

W2 earnings,

W2 earnings plus 401k deferrals,

W2 earnings plus 401k deferrals plus Section 125 deferrals, or

other?

I am setting up a Safe Harbor 401k plan for a sole proprietor. There are a total of 4 employees, the owner, his wife and two clerical.

If he opts for the mandatory match contribution rather than the profit sharing but the 2 clerical ee's choose not to defer, does the plan still qualify as a safe harbor plan and the husband and wife may defer up to $10k?

Political subdivision of state wants to adopt 401(k)plan which was created pursuant to state statute in 1984. 401(k)(4)(B)(ii) prohibits political subdivisions of state from adopting 401(k) plans. Reg. 1.401(k)-1(e)(4)provides a grandfather exemption for governmental units which adopted a 401(k) prior to May 7, 1986. My position is that political subdivision cannot now adopt 401(k) because of prohibition in 401(k)(4)(B)(ii)and because it does not meet any of the requirements of the grandfather exemption. Official of state 401(k) plan maintains that political subdivision can sign up for state 401(k) because the state 401(k) was established prior to the May 1986 deadline. Apparently, that the 401(k) plan was in place at the relevant date seems to be good enough. However, it seems to me that the actual governmental unit, here, the political subdivision, would have had to have "adopted" the 401(k) prior to the May 1986 cutoff and the fact that the state 401(k) was in place prior to the cutoff date would not carry the day with respect to the political subdivision's 401(k)being qualified under 401(k). Any comments or opinions?????

The soon to be ex-wife of a Plan Participant has approached me to value her spouses benefit. My question is do I use GATT factors, PBGC factors, or some alternative. I do not have access to the Plan to see what they are using. As a matter of information, this is a Union Plan (I believe multi-employer type arrangement). I am trying to help someone out as a favor. Any suggestions would be appreciated.

Since governmental plans are exempt from the 5500 series reporting, exactly what are the reporting requirements to the IRS and DOL and the Disclosure to Participants and Beneficiary rules. Are the reporting requirements different for plans that have been qualified vs. plans that have not sought qualification? We are often asked in RFP's about what documents we file for compliance with federal laws for the state and federal government. This seems to be more of a private plan not public plan question.

Does anyone know an internet site for the IRS audit guidelines for ee benefit plans?

THank you for your other answers CV.We are working with an organization that has two 403(B) plans, both are ERISA plans. One has employer match in

it, the other is employee dollars only. We have received conflicting

information regarding whether Schedule A still needs to be filed with

annual returns of these plans. They are preparing the 1997 returns, and

would appreciate any clarification you can offer.