namealreadyinuse

Yes Yes No Distributions are made when the check is cut. Don't forget, participants have to request distributions and ESOP participants generally have the right to take stock if dists are being made before the sale. I suspect that your motives are going to get you in trouble.

We received a nonamender compliance statement in 79 days. No determination letter application, but that timing even included one supplement requested by the IRS. We were shocked at how quickly it was processed. Anyone think this is what we can begin to expect now, or was it unusual?

Great - Thanks! If eligible in 2006 and 2007, but you don't establish your HSA until Feb 2007, how do you designate whether the contribution is for 2006 or 2007? Do you do it on your tax return effectively?

I know you can fund by your tax return due date (does that include extensions??), but do you have to have the HSA in place by 12/31/06? I don't know if HSAs use the IRA rule or the SEP rule. Thanks!

Suggested by a friend because of the Sunday and national holiday. Sounds right to me but I hadn't heard anyone put it together for sure. Does anyone agree?

I thought the IRS said that all adopting employers had to sign the 401(k) amendments, but it looks like some prototype sponsors are just adopting them for all adopting employers automatically if there are no special effective dates or election of optional provision. Can anyone clear this up?

Ahhh, the legendary scrivener’s error. It does not exist if you ask the IRS and you certainly won't find it in EPCRS.

Yep. It is ok.

COBRA extends the normal run out that would apply based on his termination of employment, but you probably knew that. COBRA should not be the full 18 months if that is what you are asking. It only takes them to the end of the period of coverage. The normal run out period should apply then, correct?

By "the plan" you mean the old, non-409A version, correct? The new 409A version will say that the specified employee cannot get a distribution until the 6 month rule is met. There is no actual receipt (or constructive receipt, economic benefit, etc.) until payment.

Cosmetic (hopefully). Why isn't it just AN implant?

If no administration was done since the termination, it probably isn't terminated. The IRS position is that it is an ongoing plan (a wasting trust or something like that) if the trust is not distributed within 1 year from the date of the proposed termination. If it is an S Corp ESOP that fails 409(p), that may mean big trouble becaue of the 409(p) excidistribution does not That sounds like it will be pretty tough under VCP. If no adminstration was ever done (since 2001), it can't be saved.

The limit will always be based on the lower deductible (in-network), but I agree that it doesn't matter in your case. FYI, the 2007 amounts should be $2,850 (a $150 increase from 2006)/$5,650 (a $200 increase from 2006).

Doesn't this raise part of the old ERSOP issue about carrying on a business. If it is a legitimate business with employees, they should be able to sponsor a QP.

Yes. IRA contributions have to be cash only, but rollovers can be in-kind if it is an asset that IRAs can hold, which real estate is. Make sure that there is enough cash in the IRA as well to cover all ongoing expenses, because the IRA contribution limits are so low that they sting a lot of these deals.

Anyone know what an "typical" number of groups is? Three? How many are manageable?

I know that this is a very basic question, but can anyone explain what coverage groups are typical for an insured group health plan? We have always used a) EE only, b) EE and 1 dep., and c) EE and 2+ deps, but I understand that other employers have different categories that may work better. Does the insurance company dictate which one is used or it is all negotiable? Any help would be appreciated. Thanks.

Sorry, but I am kind of lost. I thought the more detailed notices were required now for the 2007 year. Is that still the case?

Couldn't the plan just be terminated and paid in 2006 as well, or was this alternative not included in the transition relief?

I agree that transition relief should allow both to be deferred, but it will still be a modification for the grandfathered plan, right? I guess that if the grandfathered plan would otherwise pay out next year, it may be beneficial to give up all other benefits of grandfathering for additional deferral, but you normally wouldn't. You would have to elect by 12/31 and if the deal doesn't go through, you have given up any of the protected provisions in the grandfathered plan.

Sample Relius SH Notice

There has to be a legally binding agreement to have 409A comp anyway. That means a writing usually. You should have all material terms and conditions written down. Most of these are ERISA (top-hat) plans anyway, and you need a written plan for that, don't you.

How did he get any real $ into the plan, IRA rollover? Anyone who can provide a profit sharing document can provide loan documents. The plan is tons more complicated.

VERY vanilla deferred comp agreement needs a current market interest rate to reference. Something like "___ as published in the WSJ . . " Anybody have a favorite?

Plan termination is not a reason for holding up distributions that are othewise due under the plan. If people have a severance from service and the plan says they should be paid out on X date, you have to do that even if the plan is terminating. That (just following the existing plan terms) will probably allow you to do what you want to do. The other point raised by austin is that retained employees won't be (probably) entitled to distributions. You can still terminate the plan, but you will have to spin off their accounts to the buyers plan instead of offering each retained employee a distrubiton right. No big deal really, though.