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Tom...........I sent them the entire thread and asked them to participate. Best, Joel L. Frank

Employee Benefits Newsletter for July, 2001, published by the Boardman Law Firm states: "Comments" (P. 3, top right): "Repeal of the coordination between the 401(k) and 457 amounts gives 457 eligible employers more design options. (Note however that the annual limit on deferrals remains and provides an overall cap on deferrals.)" Their position seems to be straight forward. May I suggest that one of the attorneys that have contributed to this thread give them a call to determine where in the legislation is the overall cap addressed. Best wishes, Joel L. Frank

Additionally, I thought we as a nation save very little and the govt wants us to save more.................this is some mixed message, Washington, DC. crowd!! Best, Joel L. Frank

Boy oh Boy!.......There are going to be a lot of bewildered and perplexed people out there! This should not be considered double dipping because it is all elective deferrals..........the troops should be battle ready!

Carol, With reference to a DC govermmental plan: For 2002, the total of employer and employee contributions may not exceed the lesser of $40,000 or 100% of salary. If the employer contributes $25,000 the employee may contribute up to $15,000, with the $15,000 being a "pick-up" under 414(h)(2). Are you in agreement with me? Best wishes, Joel L. Frank

Brent, Yes, but not prior to January 1,2002

Carol, I am having difficulty in getting the full Conference Report (pension provisions). Would you be gracious enough to give us the link? Joel

Could it be that section 642 refers to only DC plans which have no provision for the purchase of prior service and, therefore, it is simply a means of allowing consolidation among retirement vehicles? Best wishes, Joel L. Frank

Some other questions need to be addressed: Does the cost include the employer's share? Recognizing that DB governmental plans mandate lifetime annuitizing, does the purchaser desire an additional lifetime benefit in return for transferring the title to the money (cost of the purchase) to the Plan. The purchaser will be giving up the wealth building aspect derived from the 457/403(B) arrangement. Moreover, the transaction can never be reversed. No refunds allowed. I am of the opinion that it would be prudent to keep the money in the DC plan. Upon retirement one can shop for an immediate annuity if one desires at that point in life to annutize. Best wishes, Joel L. Frank

Under what circumstances would using 403b/457 amounts to purchase prior service credits not be in the best interests of the purchaser? Best wishes, Joel L. Frank

What is the maximum contribution a public employer may "pickup"? Does this maximum change for 2002? Best wishes, Joel L. Frank:)

Dave.........now I know how Christopher Columbus must have felt when he came upon the "new world"!! Is this a great country or what? Please permit me to request a clarification. For 2002, what is the maximum amount one may electively contribute on a tax-sheltered basis to a governmental 401(a) DC plan? Best wishes, Joel L. Frank

Dave..........a public school district may offer a 401(a), a 457(B) and a 403(B). Under this scenario could an employee max out at $40,000+11,000 +11,000 for a total of $62,000.00? Best wishes, Joel L. Frank:)

In 1970 a PERS launched a variable annuity. Up until that time it offered only a fixed annuity guaranteeing 4% per year. The number of variable units one accumulates is subject to an "explosion factor" of 4% per year in order to keep pace with the 4% fixed interest option. Upon retirement one may exchange variable units for fixed dollars. The result is, at the outset, a measureably larger fixed annuity income than what would otherwise be generated if the participant remained in the variable account. Based on past performance of the variable account, the fixed annuity would yield more income for about the first 8 years of retirement. The fixed annuity uses an AIR of 7% and currently credits the participant's account at the rate of 8.25% per year. Is the above standard practice? Please elaborate. Best wishes, Joel L. Frank

Dave.... So, as I understand your last post, one who is eligible for a governmental 401(a) DC Plan may defer, effective 1/1/02, the lesser of $40,000 or 100% of pay. Does this mean that a public employee that is offered a 401(a) plan and a 457 plan may defer a maximum of $51,000.00? Best wishes, Joel L. Frank

Dave, according to your post a governmental 401(a) DC plan is currently not subject to the offset. So one may currently place $8500.00 in the same employer's 457 plan and make additional contributions, subject to the Plan's limit, to his individual account in the 401(a) plan. Is the following allowed for 2002? Salary $50,000.00 Plan Document permits a contribution of up to 10% of salary to the 401(a) plan. 401(a) contribution .....................$ 5,000.00 457 contribution.......................... 11,000.00 403(B)/401(k) contribution............. 11,000.00 Total Deferral for 2002 ................ $27,000.00 Best wishes, Joel L. Frank

Effective 1-01-02 one may use either a 401(k) or a 403(B) along with a 457 to contribute a combined maximum of $22,000.00. What other types of plans can be used along with a 457 to accomplish the same objective? Best wishes. Joel L. Frank:)

It is the rare 403(B) that is an Erisa plan. Most are funded solely by salary deferral with very little employer involvement. RGT and Tom are assuming that the 403(B) is an ERISA plan. Maybe JohnA can tell us if it is. Best wishes, Joel L. Frank:confused:

But "plan termination" is not a "distributable event" under 403b7 and or b11.

Tom....Please clarify...the state of California operates a 401(k) for its employees.........and NYC is about to offer one. What's going on. Best wishes, Joel L. Frank

Are 401(k) plans allowed to be offered by all units, agencies of state and local government?

Must a waiver form disclose to the spouse that there is no provision for a spouse benefit upon the death of the pensioner? Who is responsible for assuring that the spouse understands the ramnifications of signing the waiver? Must the dollar amounts showing the difference between the single life option and the joint life option be a part of any properly prepared waiver statement? Can someone paste up a standard waiver form? Best wishes, Joel L. Frank:(

Tom...so even though the law allows the states to offer 401(k), and 457 to employees, the $22,000 combined maximum can only be accomplished by those employees that qualify for a 403b and 457. Am I correct? Best wishes, Joel L. Frank

Ron...the Small Business Job Protection Act of 1996 repealed what your Plan Administrator states is still in force. The individual's account balance must be used for his/her exclusive benefit. It is no longer the property of the employer subject to the potential claims of creditors of the employer. Check to see if the plan remains qualified. If it changed to non-qualified then your Administrator is correct. Best wishes, Joel L. Frank

Pax is absolutely right......moreover the cost of electing a survivorship option, $500 in this case, is paid with gross dollars as opposed to the cost of a life insurance policy which is paid with after taxed dollars. Best wishes, Joel L. Frank