lexi

Entry dates are immediate upon satisfying a year of service w/ 1,000 actual hours of service. I think it's the new re-hire date, too. Just looking for some confirmation. Thanks!

a plan's initial computation period for eligibility purposes starts w/ EE's first hour of service. EE are immediately eligible if they are credited w/ 1,000 hours of service in a 12-month period. EE starts on jan 1, 2006 and terminates on june 1, 2006 w/ 500 hours of service. EE is re-employed on feb 1, 2009. upon rehire, does eligibility computation period remain the same (jan1-dec31) or does it become feb1-jan31? BTW: plan does not go to elapsed time method and there are no retroactive entry upon completing a year of service after rehire. plan does have 5 1-yr break in service rule, which obviously doesn't apply because this EE was never a participant. any thoughts?

A company wants to charge EE 2% for single coverage, 3% for EE +1, and 4% for family--regardless of the EE's salary and whether he or she is an HCE or NHCE. The safe harbor in 125(g) is written in terms of cost, not a percentage of salary. It seems like the ER can't charge a flat % rate of the EE's salary where the % bears no relationship to the actual cost of the health insurance. For example, an HCE earning $200,000 would pay $4,000 for single coverage whereas an NHCE earning $50,000 would pay $1,000 for the same coverage. Obviously, this does not discriminate in favor of HCEs as they are paying more than a NHCE. Would a flat % contribution scheme work under the 125 regs or is it discriminatory?

the 125 regs specifically exempt benefits paid over more than 1 year under a long term disability policy from the prohibition on the deferral of compensation under a cafeteria plan. what if an employer wanted to offer a voluntary benefit for extended short term disability where the employee would have an additional 2 years of STD coverage after expiration of the "normal" STD coverage? would that be a deferral of compensation?

I am looking at 1.457-4(e) re: excess deferrals for a governmental plan but can't figure out how excess deferrals are reported (w-2 or 1099-r or both)? if participant has excess deferral for 2007, does he/she get a w-2 for the amount of the excess deferral (plus earnings) for 2007. or does he/she get a w-2 (for 2007 calendar year) for the excess deferal amount and a 1099 (for 2007) for the earnings on the excess deferral? thanks to anyone who can help.

A tax-exempt entity sponsored what it thought was a qualified money purchase plan. They find out in 2004 that the plan was never qualified. What does the trust have to do now (the trust never filed 5500s, so the statute of limitations never ran on any of the plan years)? Re-calculate its taxable income and file a form 1041? thanks for any help.

Does anyone have or know of a good section 115 trust form that complies with GASB 43/45?

ESPP has two 6-month offering periods. Purchase date is last day of offering period. If EE becomes eligible to participate in ESPP during the middle of the offering period, and we let him/her in, is there any potential violation of equal rights & privileges provision where the FMV of the stock is different on the first day of the offering period and the day that the mid-cycle entrant enters the plan?

No, no wages. And yes, it's clear we have to move the MPPP account balance. Maybe into a nonqualified trust?

An independent contractor contributes a portion of his SE income to a SEP IRA. The independent contractor also is participating in the company's MPPP. Any thoughts for correction?

Exactly. How big is the bank? What can ER do to minimize liability? Has the IRS given guidance?

The analysis is complete: the ex is entitled to health FSA continuation coverage. Question is: now what?

Is there any IRS or DOL guidance addressing what an employer is to do after a health FSA provides an ex-spouse with benefits under the employee's health FSA? The Regs. address the situation where there is a separation from employment but doesn't say much about divorce. For example, employee has health FSA where he/she contributes $300 a month ($3600 account balance). Employee and spouse divorce and COBRA notice is required. Ex elects continuation coverage. How does/should the ER handle this? The DOL final regs were published in 2004 and the IRS' in 2001 (I believe). Surely this has been addressed somewhere, right?

Does anyone know of a good reference or cite that explains pre-ERISA rules with respect to gov't plans?

Does anyone know of an IRS cite that discusses the Service's review of the facts and circumstances surrounding a participant's separation from service to determine if he/she has retired and may beging receiving benefits? (This comes up often in the context of retire/rehire cases but I can't find a cite.)

This might be too obvious but I am looking for a cite that talks about how the IRS will apply a facts and circumstances standard to determine if there has been a "separation from service" (or "severance from employment" pos-EGTRRA) for distribution purposes. Does anyone know of one off the top of his/her head?

with respect to a public employer that has a reservation of rights clause relating to welfare benefits, do the state and federal constitutions' prohibiton on impairment of contracts play a role? caselaw searches return nothing.

I thought I remember reading about a PLR that addressed this issue re "in-service distributions" for rehired retirees.

Does anyone know of the PLR (issued within the last 10 years maybe?) that permitted retired teachers to return to work and earn compensation while continuing to receive pension benefits?

A DB Plan failed to publicize a retirement option under the plan. It seems like this is an operational failure under EPCRS. I looked through EPCRS several times but couldn't find anything that speaks to this directly. Have you run into something similar? Any help would be much appreciated.

We have a DB Plan that offers several distribution options upon retirement, with the usual suspects (single life annuity, QJSA, lump sum distribution and a hybrid lump sum and annuity). The client wants to eliminate the last option (the hybrid lump sum and annuity). It never advertised this benefit under the plan (guess there was no SMM) and I don't believe anyone has taken his/her benefit as a hybrid payout. This leads me to two questions: 1) Eliminating this option certainly would violate 411(d)'s anti-cutback provision; and 2) How do you correct the failure to advertise a benefit offered under a plan? It isn't like you can cut a benefit on the grounds that since no one knew about it, no one will be penalized. Have any of you ever come across a situation like this?

The Plan Document for a DB plan states that for early retirement purposes, a year of service is 1000 hours. In actuality, the Plan measures service in "elapsed time." Setting aside the operational failure, can the Plan amend the Plan Document to conform with current practice w/o violating 411's anti-cutback provision? My initial thought is that this would violate 411. Any thoughts?

We have an employee who died this year and was entitled to a severance payment before his death. We are paying it to his estate. I looked at the instructions to Form W-2, which indicated that we (i) submit a final W-2, listing the severance payment in the social security and medicare boxes (but NOT as income), and (ii) give the estate a Form 1099, which will list the amount of the severance payment as income. Am I understanding it correctly that the W-2 takes care of the FICA taxes and the Form 1099 makes the estate responsible for paying income tax? Does the company still have to withhold federal income taxes on the amount of the severance payment? thanks in advance for anyone's insights.

sometimes they charge it as "professional fees".

i am talking about fees for paying a TPA to administer a voluntary health assessment plan for participants. i am assuming that the plan could pay for these fees out of its assets (again, plan is self-insured).