K-t-F

Not disputing... it simply seams curious to me that if the actual deferal was made during the 2002 year it should be counted for that year. I am not wrong in my statement that 402G is a calendar year limit... right? I guess the twist is the fact that it is a partnership and income is declaired on a K-1 I apologize for the misinformation

402g is a calendar year limit. What is reported on the W2 for the calendar year must not exceed the 402g limit. Regarding the plan's accounting, if you made a deferral during October '03 based on compensation that was earned during October '03 then the deferral would be accounted for in the plan's September '04 admin. The deferral made in October '03 (along with any deferral made during the first nine months of '03 and accounted for in the 9/03 plan year admin) would count towards the 2003 402g limit.

Where does one find a book to buy? I would like to build my business and purchasing a block of clients would be appealing. AMM19, I purchased small TPA that was retireing.... I paid goodwill ($1,000) and structured the deal to pay for the clients out of future admin fees. So far that was a good plan since some clients have departed to find a TPA closer to home. I didnt have to pay for them. (also, I gained the software of the retireing TPA.... for free, as well as his years of experience) Gregory... Daily Val admin.... Do you offer that and if so do you have the technology in-house or do you use an ExpertPlan or the like service? I am getting mixed messages on whether I should go the daily val route or stay with balance forward admin. I am a very small TPA and do not administer large plans that may want the daily val option.

because you can't have a SEP (IRA SEP, 5305-SEP) along with a qualified plan and contribute to both... correct? But then what is a prototype SEP... a qualified plan?.. and dont your combine all assets of all qualified plans in determing wether you need to file? What am I missing ??

Yes, in the case of a single participant plan, if the assets are less than $100K (including receivables) there is no filing requirement.... No EZ needed. A Solo K plan is in actuality a regular qualified plan and enjoys all the benefits under ERISA.... no difference in the kind of doc. I use my regular doc and simply tailer the choices to the client's desires (eligibility, vesting, etc.). Maybe some larger institutions spent the $ to create a specific document for the Solo client... Not necessary though. I do stress to the client that once an employee is hired, that employee is eligible to be apart of the plan just like the sponsor. As long as the eligibility requirements are met by any employee, that qualifying employee must be allowed to enter the plan... cannot discriminate.

looks like those people are going to break that bench on that homepage.....

What about BenefitStreet and ExpertPlan. As a small TPA I considered one of these companies to do the "back office" behind the scenes stuff. I decided to not get into the daily val admin. My typical client wasn't suited. I am sure they would create a plan for you... If you want my contacts email me. BenefitStreet called me today as a matter of fact.

Sheesh... do plan sponsors know how much there is to know about pension plans to keep them in compliance so they can retire rich? Sometimes you have to be a Hercule Poirot to find everything in order to accomplish that task. I am the cobler whos children have no shoes!!! As I have said before, this place is a wealth of info... I enjoy reading and learning!

I was looking for something more like a shortend version of the SPD. Something to give to the EEs to quickly provide the basic provisions of the plan... I read about one somewhere, just can't put my finger on it. Almost like a SMM form.

Anyone have an example of a One Page Summary to give to the EEs for an upcoming meeting? One page, not the SPD. Something to quickly outline the plans provisions... Vesting, cont formula, eligibility Thanks!

Each employer can contribute on behalf of the employee as long as each employer is not affiliated. Each plan has a contribution limit know as the 415© limit. That is a per plan limit If your question is can the employee make deferral contribtions to all plans he/she is apart of, the answer is yes. The catch is that the total of all the deferrals made to all the plans he/she is apart of can not exceed the 402g limit for the calender year. The 402g limit is a limit imposed on the individual, not the plan. 2004 402g limit is $13,000. If the employee is over the age of 50 then he/she can defer an additional $3,000

WellSpring, I am glad you made the point to be the squeeky wheel... My "MO" regarding soliciting has been to gently revisit each favorable lead with a follow-up... keep my propaganda at the top of the pile, but at the same time dont be annoying. I know that a CFP,attorney, or CPA is not going to instigate a change to their client if there really is no reason to. If it aint broke.... GSHAC has made some excellent points which I put into place when I took over this business in '99. Raising my fees a little to see if the "complainers" would drop off (none did) and creating a niche, focusing. To qoute myself I think that GSHAC's response to that statement would be to find a flaw, expose it, and then run with it. Now to come up with that catchy phrase...hmmmGSHAC mentioned FedEx... does anyone know where that business plan came from? The guy who started it (Fred Smith?) was a student at Harvard Business School and the idea was a school project. "Fly everything into one location and then fly it out again.... overnight? will never work" The teacher said... failed him. Eh...the rest is history, or so that is what I was told. Thanks for everyone's comments!

I understand that it is an individual limit... are you saying that neither plan needs to make a correction and that the individual will simply be penalized by the IRS for the mistake? If so, what will the penalty be? an excise tax based on the amount of the over deferral?

This is not my plan so I will find out... but, if they are not related you do not correct? the $ stays in?

I looked at old posts... here is what I found. If a participant is in 2 plans and ends up over deferring for 2003, one plan needs to distribute the excess prior to the current year end, 2004. That plan will issue a 1099R and the participant will be responsible for taxes on the overage in the year of the distribution (2004). Also, the participant's W2s for 2003 will show that he/she over deferred and will end up being taxed for the overage. Double taxed! What else? anything?

Ok... is this a first? I need some $ to grow my business.... I have a client that has a pension... if he invests in my company would that be a prohibited transaction? If it is pension assets I am sure it will be... but personal $$?

I am no CPA... do not handle IRAs.... I do know there is a difference between a ROTH and a traditional IRA. My question is .... can a participant roll assets out of a qualified plan into a ROTH? Advantages.. disadvantages? Thanks!

Got it... thanks !!!

True.. ok, 1099 is not the way to be paid. What I have been told is it is a Sub S corp and (not being a CPA) if I understand it correctly, at the end of the year she, as a partner in the business, will receive her share of the profits which will be her compensation and in turn a contribution can be based. Her projected income will have to be $164k to receive the full deductible $41k (25%) contribution. Her $13K salary deferral will be paid through her other employer. The husband will not make a deferral (or his ER cont will be reduced by the $13k deferral keeping him under the $41k limit). If this sounds right my question is how does she get paid... not a 1099 but what... Thanks for the help!

What about 1099?

Situation Update!!! client has SE business "A". Also corporation "B". Wife works for totally unaffiliated company "C" in addition for company "B". Client wants to max out company "B". He is going to make contribution to company "B" for himself and wife... $82,000 ($41K each...no deferral, corp contribution only). Wife will also defer $13,000 at company "C". 402g not violated... Ok?

Because he is the owner of both businesses... thats what I thought. He will be limited to 41K total between the plans (deferrals included). Thanks

Client was SE as of 1/1/04 until recently and has made a $13,000 deferral to a Solo K for 2004. He has since closed a huge deal and his CPA told him to incorporate. He wants to establish a plan for the corporation. Can he make a $13,000 deferral to the SE plan from SE $, and in addition make a $41K contribution (no deferral) to the incorporated plan from the proceeds of this deal? This will mean he is going to shelter $54K for 2004 between the 2 plans... ok?

Even if there is only one participant in the plan and he is the trustee? I understand that rules are rules... your advice is appreciated. Just trying to make this as painless as possible for me and the client.

Client has a PS plan... he is only participant. Has invested in limited partnerships, to the tune of $1mil plus. My question is how to value these investments... From the K-1? Based on cost? Obviously based on cost would be the easiest... but if valued at cost, would that be accurate enough in the event of an audit?