Talking to the attorney who preps our plan documents today and he's of a mind that any plan document fee including elective amendments and plan termination fees can be paid out of plan assets - I'm pretty sure I was at an ASPPA sponsored event where the speaker indicated that elective fees such as elective amendments and plan termination fees were considered settlor fees and therefore could not be paid out of plan assets - anyone care to chime in? Thanks

A new company has 20-30 office workers, and 700 or so "laborers" who are paid on an hourly basis and are "provided" to various other businesses for their use. The hourly employees are paid by the new company as W-2 wages.

The new company would like to establish a retirement plan for the office workers and exclude the hourly "laborers", as the owner feels that these employees would not want to take advantage of the plan. In addition, the owner does not want the expense of an audit that would come along with 700+ eligible employees.

Question is can these employees be specifically excluded? I am currently in the PPA restatement phase for current plans and see that the prototype document I am using allows an exclusion for "Employees that are paid on an hourly basis". If this is allowable, I might have to have a new conversation with our new company CFO...

Thanks for any replies.

Is the increase in the 401(a)(17) compensation limit considered to be a plan amendment increasing benefits as restricted by 436 for an underfunded DB plan and therefore cannot be used to calculate benefits, or is it only considered as such an amendment as applied to the 415 limit?

Trying to understand at what point a wrapped plan becomes a a 'group health plan' subject to hipaa privacy rules to the extent that the plan needs to adopt a formal privacy policy. If there is such a need to what extent do plan administrators develop such a policy and hand out notices (annually?) to employees?

Straight vanilla profit sharing plan - adoption agreement vesting section calls for "participant" to become fully vested upon death or total and permanent disability (no distinction for active or termed participants).

Participant left Company in 2009 and was 40% vested in the ER PS portion of his account at that time. Has not yet taken distribution. Participant passes away. Beneficiary is entitled to 40% portion or does participant account vest 100% now that he is deceased?

I have been asked to find out if there are companies that will be offering ACA compliance software in so far as completing the 1094,1095 forms, etc.

Does anyone if FT Williams is planning on coming out with anything?

Thank you.

So I am quite sure this probable isn't allowed but I'm not seeing it in the IRS individual 401k regulations themselves so I figured someone here would might know the answer. My plan documents (Vanguard) are also unclear on the issue.

As an s-corp owner, let's say I pay myself 50k in W2 wages. Out of that I am able to contribute $17.5k as an employee to my individual 401k and my company can also contribute 25% ($12.5k) as the employer portion. Now, I must have the company reimburse me for my health care premiums in order to be able to write them off so that also gets added to Box 1 (wages, tips, and other compensation) of my W2 on top of the 50k salary. It also gets added to line 7 (compensation of officers) of form 1120S. Therefore, as they are added as though they were wages, can I contribute 25% of that amount to my solo 401k as well? Let's say my health care premiums were $4000 for the year and therefore would increase my wages to $54,000. Can I then contribute $13,500 instead of $12,500 for the employer portion? Would the same also work for HSA contributions that were reimbursed in the same manner?

Thank you for your time!

Seminars?

Literature?

Books?

Thanks for any ideas.

Is there an exception to the recurring employer contribution rule when the plan is a 401(k) plan?

OK - so found my own answer - depends on plan design - whether or not employer contributions are allowed or not.

I have a question on gains with after-tax contributions to make sure that I understand this correctly. To keep things simple (especially for me!), let's use a situation where a person puts in a first time after tax contribution of $10,000 into their 401k, and makes $10,000 in earnings.

Let's also assume that this person starts the after tax contribution at age 55. Is it correct to say:

1) After making the contribution, if the person immediately executed a Roth conversion of the funds within the plan (provided the plan documents permit), are they NOW Roth funds with gains no longer to be taxed? (This would be assuming that the funds remain in the plan for 5 years and the individual is over the age of 59 1/2 before they take contributions)

2) Using this same example, assuming they kep the funds in the plan for 5 years and are over 59 1/2, can the individual rollover both the basis and gains to a Roth IRA? Is it then correct to say the individual could then take out distributions on basis and gains tax free?

I am getting confused with this, but I was believing that if the funds are converted to Roth and meet the Roth requirements (e.g, 5 years, 59 1/2), then contributions and gains will come out tax free. And, if it makes it easier for me to understand : ) I would be starting by: 1) making an after tax contribution, 2) converting to Roth immediately within the plan, and 3) wanting to take out distributions tax free (with the assumption that i have met the 5 year and 59 1/2 rules) And, for options, I could always rollover the funds to a Roth IRA and take distributions from the IRA, if I chose.

Thank you so much.

A husband has Family coverage HDHP through their employer. His wife waives coverage at her seperate employer, and receives a cash award per pay for waiving health coverage. The wife would like to take the cash award and contribute that amount to an HSA.

Would the HSA contribution be pretax, or should it be treated as a voluntary deduction, and they can claim that on their taxes?

-John

Participant is 75, but is no longer working and is taking RMD's. Spouse is 65, and is still working. Both are participants in the same 401k plan. Participant dies, spouse is the sole beneficiary. Neither is an owner.

I know if the spouse were to rollover his account into an IRA (spousal rollover) and treat it as her own IRA, she could stop the RMD's until she turns 70 1/2.

After 2001, a spouse could also rollover benefits into an eligible retirement plan (and, presumably, also treat his account as her own and stop RMDs).

Since she is in the same plan as her deceased spouse, can she elect a "rollover" of his account into her existing account, treat it as her own and STOP RMDs until she turns age 70 1/2 (or retires)?

In a Law Firm, document is written that each participant is in their own group

The plan has always been run grouping the participants into groups and then allocating the same percentage to each group. Group one is equity partners, group two is non-equity partners earning over 260,000, group 3 is non-equity partners earning less than 260,000. Group 4 is all other employees. The first two groups receive the max, the second two groups, the minimum to pass testing.

The plan is changing in that the non-equity partners are getting younger and do not want to contribute a large contribution to the plan. They receive their income on a K-1. From what I've read, the equity and non-equity partners can decide individually on what percentage they put in the plan. Has there been any problems with this in an audit? Non-equity partners that are not considered HCEs still must receive the minimum to pass gateway, correct? (this is a Safe Harbor Plan and uses top paid group).

If they would switch their payroll in that the non-equity partners would receive a W-2 instead of the K-1, would that change anything?

Any helpful hints on running a new comp plan for partnerships would be appreciated.

Thank you.

We have a plan that limits employee deferrals to 20% of annual compensation. The AA also says they may defer 100% of their bonuses, regardless of the above limits (which is in reference to the sponsor electing to use the IRS limit or to limit deferrals to a specified $/%. The BPD doesn't really clarify anything.

I would be under the impression that the 20% limit would supercede the bonus election (for example, someone defers 20% all year and then gets a bonus...could they then defer 100% of it which would put them over 20% of plan compensation?)

I couldn't find any references on EOB or elsewhere.

Thanks!

Co. A purchases Co. B. in asset purchase. Both Co. A and Co. B have retirement plans.

The intent was to merge the plans, but Co. A didn't formally adopt the plan at the purchase date. Co. A did prepare a resolution to merge the plan about 30 days after the pruchase. Co. B continued to accept contributions beyond the asset purchase date.

Co. B's advisors are telling them that since the plan wasn't adopted simultneous with the buy/sell transaction that the plan terminated & can't be merged.

Although ideally the plan should have been adopted at the transaction date my concern is that since contributions were accepted after the transaction date if Co. B's plan is allowed to terminate and distributions are made. we have successor plan issue if Co. B's former employee's are allowed to particiapte in Co. A's plan.

We do not administer any plans with life insurance. However, we may be getting a single participant DB plan with $1M of whole life.

If the participant's projected benefit is $14,500 the $1M should be well within the incidental limit of 100 times the monthly benefit. However, in reading the document it appears both the PV of the QPSA and the insurance proceeds together cannot exceed $14,500 x 100 = $1,450,000.

The document indicates that rollover assets can be used to purchase life insurance with no incidental limit. If this participant rolled over $500k from an IRA to the DB plan, would it count toward his limit? For example, would the limit now be $1,450,000 + $500,000 = $1,950,000.

Thanks.

Looking for a plan document provider who has developed an automatic-enrollment health plan document and forms package, thanks

My company is looking into a new system for our COBRA administration. I was wondering what administrators were using out there.

A company has both a 401(k) Plan and a 403(b) Plan.

The 401(k) Plan excludes employees by Job Title, such as Director of Finance, and CFO, and CEO from making elective deferrals into the 401(k) Plan.

However they are eligible for the Profit Sharing Contribution.

These employees instead make their deferrals into the 403(b) plan, which excludes any one who is eligible to make deferrals into the 401(k) Plan.

Basically, if the excluded employees were to make maximum deferrals into the 401(k) Plan, it would fail the ADP test. Therefore, they instead are excluded from the 401(k) by Job Title and make the maximum deferral into the 403(b).

The 401(k) Plan is being audited and the Auditor told the client that they need to stop excluding these employees by titles and that group of employees can chose not to make elective deferrals into the Plan, but he said it appears that the client is trying to avoid failing the ADP test.

Does anyone agree that the Plan needs to stop excluding these employees by Job Title?

Any guidance is greatly appreciated.

Alex.

Got this from a plan participant:

Attached are all the filled out forms - needed for my dismemberment.