masteff

The other problem is "replace all". Suppose you wrote "a health savings account" a bunch of times in an article and someone comes along and tells you to abbreviate instead. You do a "Replace All" from "health savings account" to "HSA". Now your whole article has "a HSA". Can't say I've done this exact thing w/ HSA but certainly have with similar.

Yep, and depending on the language for how it was frozen, could even allow new loans to be taken. I've seen this in acquisitions where the acquired plan is frozen and employees are moved to the purchaser's plan.

I went searching for "a needle in a haystack" and found this oddly interesting thread which agrees: http://www.writersdock.org/modules.php?nam...ic&p=351893 Specifically someone more versed in linguistics than I says "strangely the letter 'H' itself has a vowel sound - Atch - thus, paradoxically, it's An H"

Do you actually think that your obtuse, condescending comment in the form of a question actually provides any real enlightenment to the original poster?!?!? You make a valid point but that's the 2nd or 3rd time in recent posts that you've been both vague and harsh.

That would be in your scanner setup (I looked in Adobe and confirmed it doesn't have a darkness setting). For example, I have a Cannon scanner and it's software has separate settings for photos (jpg) and documents (pdf). Which makes sense, what's good for one, isn't necessarily good for the other. So best I can do is direct you to your scanner software. I'm not sure what the setting will look like in your software. It may be a lighter/darker adjustment or it may be choices between "black and white"/"gray scale"/"color" ("black and white" will have highest contrast and likely print the darkest). You might also try a higher level of dpi; this will make the file size bigger but will give better detail and might print better. Also, my scanner came w/ more than one software utility. I've noticed that one offers different scanner setting options than another does. So if I needed more control on how the scan came out, I could open the one software and let it control the scanner (but I'm usually lazy and just push the button on the scanner and go w/ what comes out). Hope that puts you on the right path to figuring it out.

Mike P got in before me... To cover the owners' kids does come to mind. Small business owners will pay their kids to do odd jobs and then put the money into IRA's for them. The concept gets some coverage in articles oriented to small business tax minimizing and estate planning. Including the kids in the 401(k) would be a further extension of that shifting of income. Outside of that scenario, I'd have to agree with you in general. My new employer doesn't have a plan and in discussions about what to do, I'm torn between 18 and 21. If we didn't have a 20-year old clerk, I'd probably go w/ 21.

The rules changed from the 2006 instructions to the 2007 instructions. 2007 Form 5500EZ instructions say: Who May Not Have To File You do not have to file Form 5500-EZ (or Form 5500) for a plan year (other than the final plan year) that begins on or after January 1, 2007, if you meet the five conditions above and you have one or more one-participant plans that separately or together had total assets of $250,000 or less at the end of that plan year. As it explicitly says "of that plan year" and as the instructions previously stated "of every plan year", they have made a distinct change allowing you to stop filing (until the final return).

Rules applicable to cash or deferred elections are specified by IRS Reg section 1.401(k)-1(a)(3).

Well, you're doing two steps so the problem could be in either one. Scanning: Since it's shifted up and right, makes me wonder if you're getting it lined up correctly on the scanner. I presume you've looked at the edges around the glass and found where it shows to line up a letter size document (many have an arrow in one corner to show where the top left corner should be or there might be marks with "LTR" to show where the edges should line up). After you've scanned something, open the pdf in Adobe Reader and then change the zoom to "fit window". Does the document look okay there or is it out of place? Move the paper on the scanner and try again to see what change that makes. You might need to open the scanner software and check the settings. One thing that comes to mind is "crop/trim margins". Unfortunately it differs from software to software so you might have to do trial-and-error or if all else fails look in the help documentation. Printing: If it looks okay onscreen in Adobe, then on the menu click File / Print. In the dialog box, look at "page scaling" and "auto-rotate and center". Mine are set to "reduce to printer margins" and auto-rotate is checked. Also make sure it's selecting the right paper size and source. You might also click File / Printer Setup and go into properties to make sure the problems not coming from some other printer property.

Is it possible that the term they are using is "actuarial adjustment"? We'd really need to know the exact phrase Fidelity is using to be able to help you understand that piece of the situation. Fidelity has the information and they appear to be doing the QDRO processing, so the information needs to come from them. But they probably need the information request in the proper legal format. They can't just disclose that information. Either you lawyer needs to submit the proper form of information request (I'm not a lawyer so I don't know the proper term to give you) or your ex needs to sign an information release (or both). If you've been doing the legwork to help reduce your legal fees, this is the point where you need your lawyer to be involved in dealing w/ Fidelity; he/she should be able to request the information.

Just an FYI, not contradicting Mike at all, but Fidelity does offer a QDRO service to clients who choose to pay for it, so it's possible that's why they're talking to Fidelity and not to the plan sponsor (it might have been outsourced). Even so, someone at the company should be able to help you understand what's being said. Have you done a draft QDRO? Normally a draft would be submitted to the plan first to save having to go to the judge twice for corrections. The plan (Fidelity or the sponsor) should be able to provide some numbers from the draft. And I really agree w/ Mike that the word "fee" doesn't make sense. Were they possibly talking about reduction in benefit for early commencement? Or possibly talking about reduction in benefit for chosing an alternate form of benefit? Probably need to talk to Fidelity and ask what they mean by "fee", make sure that's the right word, and what's it for and who is charging it.

It is correct. If the loan would increase the hardship, it's not required. IRS Reg 1.401(k)-1(d)(3)(iv)(D): "Employee need not take counterproductive actions. For purposes of this paragraph (d)(3)(iv), a need cannot reasonably be relieved by one of the actions described in paragraph (d)(3)(iv)© of this section if the effect would be to increase the amount of the need. For example, the need for funds to purchase a principal residence cannot reasonably be relieved by a plan loan if the loan would disqualify the employee from obtaining other necessary financing."

That's the way I see it. They're non-participants and have no rights. Provided the amendment is made and effective before they become eligible to enter the plan, they simply go into the new schedule and have no choice in the matter.

There's small section on vesting schedule changes in the CCH US Master Pension Guide. Some references are: IRC 411(a)(10), ERISA 203©(1), IRS Reg 1.411(a)-8(a), Temp Reg 1.411(a)-8T(b). My edition is a few years out of date, so I can't promise those haven't changed at all. The CCH Guide does specifically state you can change to a longer schedule as long as it's w/in the standards allowed. The cite on that is an IRS Alert Guideline. I looked and found the latest version of that here: http://www.irs.gov/pub/irs-pdf/p6389.pdf (see section IV page 6 and section VII page 9). Oh, also you are correct that new forfeitable accruals must be vested at the same level as previously accrued forfeitable money. From the IRS Alert Guideline: "For example, if a plan is being amended to replace a 3 to 7 year vesting schedule with 5 year cliff vesting, a participant who has three years of service at the time of the amendment and elects to go under the new schedule must be 20% vested in the amount accrued in the fourth year (as well as in amounts accrued in the first three years). 1.411(a)-8(a)" EDIT: with regard to a BRF test, I'm assuming, and someone can correct me if I'm wrong, that the non-participants don't have any BRF's so changing the vesting schedule doesn't impact them. Only the 2 current participants have BRF's and they're being treated equally.

I'd say the code P applies to everything reported on that specific 1099-R, which means both the distribution and the withholding. I'd put them both on the same year.

You will be partially in the 10% and partially in the 15% tax bracket for federal taxes (depends on your deductions and exemptions). You will probably be in the 7% tax bracket for South Carolina taxes (but I've never done SC tax return so no idea about exclusions, deductions and exemptions).

Do they have current staff who are about to enter or no staff and just being pro-active before they hire some?

Some aspects can vary from plan to plan so it's dangerous to try to apply generalizations to an individual situation. The best place to start is with the person at your company who handles employee benefits and the ESOP. Your benefits administrator will be able to explain what options will be available to you after leaving the company.

rcline, I started to agree w/ you but then re-read what Miner wrote... "2% of the Deferral Contributions made", not of eligible income. Miner, I assume since you capitalized Deferral Contributions that it's a defined term in your plan and that you've specifically review the plan and confirmed that catchup is separate and distinct from Deferral Contributions. I'm thinking you'll need to correct under EPCRS. Anyone else have a thought on the type of correction?

John covered two of my three thoughts. 1) even if you fund it in January, you can put it in cash to start and then move gradually to investments during the year. 2) personally, I'd say put the money in when you have it (so if you have it at the first of the year, go ahead and do it). 3) if you spread it out over the year, the more automated you can make it the better, such as thru direct deposit or eft draft from checking (so you don't either forget to do it or try to second guess which way the market is moving). Okay, a fourth thought: you're just starting out and are dealing with few thousand to start. At that level, dollar cost averaging has a smaller benefit (which goes to your last question of is it significant enough to worry about). You have to weigh the potential reward of doing it with the additional effort of doing it.

I remember the first time as a junior staff accountant when I was told to footnote something in a work paper with "SWAG". I have never, until this moment, seen a SWAG procedure in written form. (Should I be concerned about my own mental well-being that I understood nearly 50% of that excerpt???)

I see two issues, which you seem to be aware of as well. One is taxation. The other is growth of the investment. Regarding taxation: being in a low tax bracket now and expecting to be in a higher tax bracket when you take distributions during your retirement years, then you'd likely be better off putting the additional money in the Roth. This is further supported by the fact that you are young and have many years for the money to compound. The taxes on the SIMPLE earnings would likely be greater than the taxes on the Roth contributions. Even if some catastrophe comes and Congress starts taxing earnings when distributed from Roths, you will still have gained by having the tax-deferred earnings. Regarding growth: because both have compounding that is not currently taxed, if you picked identical investments, both options would have the same amount of growth. It's only when one investment is taxed year-to-year versus one that isn't, that you end up with differences in growth. For example, if you put the money in a savings account, where you paid tax on the interest every year, then you'd have less growth because the taxes would reduce the amount of future compounding. Since both the SIMPLE IRA and the Roth IRA are not subject to year-to-year taxes, then their growth potential is equal (assuming identical investment options). A couple other things to think about. One is fees. Will the Roth IRA have annual fees until your balance is over a certain dollar amount? (If so, you can also look around, the investment company where your SIMPLE is may waive fees on other accounts you open with them.) Another is investment options. Does the SIMPLE IRA have investment options that are appropriate and competitive?

For the sake of a different view... "may submit claims for expenses or benefits for the remainder of the Plan Year or until the Cafeteria Plan Benefit Dollars allocated to each specific benefit are exhausted" First, I would take "may submit claims for benefits for the remainder of the Plan Year" to NOT limit or restrict such claims to only prior to the participants death. Prop Reg 1.125-1 Q&A-4 does not impose such a limit and absent an explicit limitation in the plan language, I couldn't support one. Second, "until the Cafeteria Plan Benefit Dollars allocated to each specific benefit are exhausted" tells me that the plan drafter intended for the spouse/beneficiary to optain the full benefit available to the participant under the plan. This generosity in the language would further support my interpretation that the plan drafter did not intend to limit or restrict what is available to the spouse/bene. Third, "If a Participant dies, his partipation in the Plan shall cease" to me is merely a mechanism to prevent further deductions for the unfunded balance of the participant's account (such as from post-death benefits). The participant's lack of participation does not preclude the special level of participation provided to the spouse/bene under 1.125-1 Q&A-4.

One thing to consider before going down that road is does the plan in question have any other deceased participants w/ multiple benes and if so were those handled w/ one or separate accounts? What does the plan document say... could it be construed to require separate accounts for benes? (Though that might imply an operational failure.) How different are the ages of the benes (which is to say, how significant is the impact to the younger benes)?

Looking at opers.org, yes, you can accept a rollover from there. This page has copies of their IRS determination letters: https://www.opers.org/about/legal/index.shtml It's the same as a rollover from any other qualified plan.