rfahey

I have a dentist with 3 employees who has a SAR SEP plan. He can only defer 125% of the average deferral of his 3 employees I believe. In 2014 he was allowed to defer 5.38% based on this test. He is self employed for taxes. My question is what his wife is allowed to defer (%) now that she is eligible on 1/1/16. Can she max out her salary deferrals up to the IRS limit for 2016? Or is she limited by the ADP test since she is the spouse of the owner ? What can she contribute for 2016 ? Thank you !! The fund companies do not have answers to these kind of questions.

Client has had a matching SIMPLE IRA plan for many years now. They have hit a really big hole for their business in the last three months. This has resulted in layoffs, pay cuts, benefit reductions, etc. and even with these they may not make it. They are telling me that they cannot in any way continue to make matching contributions to the SIMPLE. If they stop the employer match they are wondering if the can let employee keep deferring until they can turn things around or they are out of business. What can I say to them under these circumstances ? Thank you

I saw on a spreadsheet recently that you can rollover a SIMPLE IRA account into a qualified plan ( 401K , profit sharing, etc ) after the SIMPLE account has been in existence for two years. Is this correct ? Is it new ? Thank you.

Is there any special ADP testing required in a SAR SEP IRA plan when the owners wife becomes eligible and wants to participate ? How about the owners son ? THank you

The financial institutions are advising that they do not track deposits ( what I would call basis ) into Roth IRA accounts. So does that mean that every person will need to track their basis in their Roths ? If so - most people do not retain their old statements and therefore do not have this figure. One fund company told me recently that they do not even retain statements prior to 2000 any longer. If the above comments are true then how does a 50 year old for example figure his basis when he cashes in his Roth IRA account ?? THanks

Thank you. What is the best route for the father on the son ?? Should the son make elective deferrals ? Is the son limited by the 1.25% since he is related to the father ? How does the 50% test work with the son ? Bob

I have a dentist with a SARSEP plan. He has a son who is age 21 and works part time on his website and has worked for him for over three years now. Questions: Must the son come into the plan ? If he does not make any elective deferrals does it help his father in any way for the ADP test ? How is this test done with the son and the father ? For ADP testing purposes is he considered a HCE ? Is the son counted for the rule that says that 50% of all eligible employees must defer ? If so and he needs to defer will this hurt his fathers elective contribution percentage. Many thanks

I have a client who is age 70 in an ERISA 403B plan. I believe he can take a distribution of a portion of his account balance and roll to an IRA plan with me to further diversify his investment portfolio. Can he also rollover into a 403B account with a new investment organization ? The reason I am asking is that he even thought he is the executive director of the organization he is probably not required to take RMD's since he is not a 5% owner - correct ??? So if he rolls to an IRA hew will have to take RMD's I believe. If he rolls to a new account titled as a 403(b) can this avoid the RMD requirement until he retires down the road ?? Thanks !

Doctor "Smith" is in a medical group professional corporation with 20 other physicians. They have a profit sharing plan ( not a 401K) and they put in the maximum for each doctor yearly ( $51,000 ). All employer funded. Smith also has some 1099 income that he gets from a local Hospital Association. He set up a Solo K Plan for this income and he defers $22,500 into it yearly. Is this allowed ? Can he make a profit sharing contribution to the Solo K plan on $30,000 of net schedule C income also ?? Thank you !!

Can anyone advise when the salary reduction contribution is due for 2012 for a self employed individual who is on extension until Oct 15th ? For SIMPLE 's in this situation I am under the impression that the salary deferral is due January 31st, 2013. If this guy has a 401K plan I am under the impression that he has until Oct 15 to fund his salary deferral and company contribution. But I am not sure about salary reduction SEP plans however which is what my main question above is. Any comments on anything in the posting are appreciated ! Thank you.

I service an old SAR SEP plan with American Funds. The self employed owner and his employees do deferrals. I have done the ADP testing to make sure he stays within the limits. We have a 3 year wait to be eligible. His wife now works for him. The document can allow employees to come into the plan for deferrals only without waiting the 3 years ( separate eligibility ). If we change this I presume the ADP test stays the same using just eligible employees for deferrals. So if these employees including his wife come in immediately for deferrals only --- would they NOT get the top heavy munimum until their 3 year regular wait is up ?? How would the ADP test work for the husband ( owner) and his wife. Are they each limited to the 1.25% figure ? Are they aggregated somehow ? Thanks, Bob

Can someone clarify on the timing of deposots for self employed individuals to their SIMPLES.? I am self employed and usually extend my tax return. I never know what amount I will contribute until I do my return in the summer. Therefore I do not make any contributions usually until the summer ( "deferrals and match " ( however for self employed the funds all are the same really )) THanks for the input.

If no settlement/payment option had been selected the RMD on this annuity would be calculated like any other "account" using the normal factor table and the Dec 31 balance.

The fixed interest rate annuity is an IRA and a stand alone contract. It is entirely separate from the other 3 IRA's. It is an annuity contract issued by National Life of Vermont many years ago. It has a current cash value and a fixed rate of 3% interest. Once we settle it on a 5 year payout it will no longer have a "cash value" that can be withdrawn in lieu og the 5 years of guaranteed payments.

Hi Gents, I asked the original question so I will summarize again as I am getting confused. Client has 3 IRA accounts and one IRA annuity. He will "settle" the IRA annuity by taking a 5 year period certain payout. The insurance company will pay him a monthly guaranteed amount for 5 years the it is done. Since it is being paid out over just 5 years the RMD on this settled annuity is higher that it would be if it were in an accoiunt and the factor was being used to calculate the RMD. So the question is --- does the annuity stand on its own now and have no bearing on the RMD calculation on the 3 other IRA accounts ? I am not sure and actually doubt if the insurance company will calculate a fair market value of the annuity each December 31st. THank you,