WDIK

Just to be fair, there are other schools of thought with regard to this statement.

http://www.benefitslink.com/cgi-bin/qa.cgi...id=70&mode=read http://www.benefitslink.com/cgi-bin/qa.cgi...id=56&mode=read

Were the applications made over the internet? If so, the numbers issued are provisional. Once the IRS system catches up one of the numbers will probably be voided. I would guess that a similar "voiding" would occur if the forms were filed via fax or mail. Some other options to consider: 1) Select and use the number that results in the best poker hand. Challenge other TPAs/Employers to better your hand. 2) Use both numbers in a haphazard or random fashion to get the IRS's attention and create more billable work. 3) Send an invoice for your services to each partner separately. You may get paid twice. SPECIAL DISCLAIMER AND CLARIFICATION The preceding three suggestions were made in jest. I would never condone gambling or dishonesty in any form.

Not applicable, Lori said... JanetM already pointed out that if the match is calculated based on each pay period, no corrections should be made. If the match is simply incorrect, appropriate measures should be taken. Why not base your personal threshhold on whatever amount you are willing to defend on IRS/DOL audit? Or in this specific case, since the plan filing requires an accompanying audit (at least that is what I assume Lori meant in her last post) you could base your conclusion on the auditor's requirement. I would also take note of Austin3515's final sentence.

I do not believe that IRC 4979 gives any exceptions to the 10% tax other than where the excess contribution is distributed within 2-1/2 months of close of the plan year.

Obviously the trick is determining what each will be worth 10 or 20 years from now. Please share any insight you have in this regard.

A little known fact regarding austin3515's DOL quote is that the circumstances surrounding it were the inspiriation for the likes of Barbra Streisand, La Luna and others.

The instructions for the schedule P indicate "A separately filed Schedule P will not be accepted."

My thoughts are rarely original, but consider the following quote from the DOL Website: "...if your plan provides for salary reductions from employees’ paychecks for contribution to the plan, then these contributions must be timely deposited. The law states that this must be accomplished as soon as it is reasonably possible to do so, but no later than the 15th business day of the month following the payday. If you can reasonably make the deposits in a shorter time frame, you need to make the deposits at that time."

Well, I certainly don't want to be the first one to answer, but I will point out the following langauge from Section 1.416-1. G-1 Q. What retirement plans are subject to the top-heavy rules added to the Code by the Tax Equity and Fiscal Responsibility Act and amended by the Tax Reform Act of 1984? A. All stock bonus, pension, or profit-sharing plans intended to qualify under section 401(a), annuity contracts described in section 403(a), and simplified employee pensions described in section 408(k) are subject to the new top-heavy rules added to the Code by the Tax Equity and Fiscal Responsibility Act and amended by the Tax Reform Act ("TRA") of 1984.

I didn't say competent, I said enterprising.

mbozek: I can certainly see your point, but is it so far fetched that some enterprising attorney will try to make such a connection as implied in the Deloitte article?

http://benefitsattorney.com/modules.php?na...=showpage&pid=2

"The Court’s ruling, which is consistent with the Equal Employment Opportunity Commission’s interpretation of the ADEA, makes it easier for older workers to bring federal age discrimination claims against their employers, and this could include offering new grounds for challenges to the adoption of cash balance plans." (Click above for the link.)

§ 1.401(a)(9)–2, A-2© © For purposes of section 401(a)(9), a 5-percent owner is an employee who is a 5-percent owner (as defined in section 416) with respect to the plan year ending in the calendar year in which the employee attains age 70-1⁄2.

If you are referring to the decision in Smith v. City of Jackson, the decision made it easier for older workers to make a case for discrimination under the ADEA. Employees do not need to show that the age discrimination was intentional only that something in practice was more detrimental to older employees. One of the major issues surrounding conversions to cash balance plans has to do with age discrimination.

The more facts the better, IMHO.

It seemed like a bull's-eye to me.

I still don't see how the funds are "out of the plan" by 3/15.

Lame Duck: How would the scenario play out if the additional income to the corporation is only $1,000 rather than $100,000?

There may be some other issues here. Who issued the 3/17 check, if it was not the plan? Please describe your scenario in more detail. EDIT: (Sorry for duplicating Belgarath's thoughts. I've got to stop letting work interrupt me during the middle of my posting.)

While the plan does have until the end of the plan year following the plan year for which the exces contributions were made to make the correction, there is the 10% penalty tax that applies if the corrections are not made within 2-1/2 months.

Maybe you should have your client issue a check to pay for their counsel's services around Christmas time, but date the check 4/1/05.

No argument there. The point was that this is the 401(k) forum.

An excerpt from one of the 3/25 Benefits Link Newletter articles states: At its board meeting on March 23rd, the Financial Account Standards Board (FASB) board voted to issue a proposed FASB Staff Position (FSP), tentatively titled Proposed FSP EITF 00-19-a, "Application of EITF Issue No. 00-19, 'Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock' to Freestanding Financial Instruments Originally Issued as Employee Compensation". I wonder if they get paid by the word.