Christine Roberts

Is there an unofficial rule of thumb for the maximum dollar amount of excludible de minimis fringe benefits (e.g., goods such as VCRs, clothing provided in holiday raffles, etc.) I am aware that $400 per person per year is the most an employer can deduct without a formal benefit plan but am wondering if the threshhold is not a bit lower for excluding the benefit from an employee's taxable income; e.g., $100 or $50. This as a result of reading Treas. Reg. Sec. 1.132-6(e). Any comments appreciated. ------------------

Who out there is familiar with benefits issues for federal credit union employees? ------------------

Is it safe to say that ERISA does not impose express obligation to provide individual participant account statements on an annual or more frequent basis but that doing so is necessary to obtain limited fiduciary liability pursuant to ERISA Section 404©? ------------------

I agree that COBRA manipulation is a possible argument, and that "successor plan" coverage would inevitably arise. Just for the record, neither party (husband or wife) is a client or likely to become a client -- this was just an FYI inquiry through a third party. ------------------

PLR 199930015 recently held that LTD coverage provided by a VEBA and obtained either through purchase of new coverage or by modification of existing plans is attributable to employee contributions for purposes of Code Section 104(a)(3), even when the employer acts a conduit for the purchase of coverage or the payment of premiums, such that benefits received under such plans are excluded from employees' gross income. Specifically, employer either purchased coverage and reimbursed itself through after tax payroll deductions, or paid for premiums and include premiums in employees gross income, with additional payment to employees to compensate for cost of coverage & additional income tax burden. Am wondering if the result was directly related to use of a VEBA or if it would also apply to the same practice (employer as conduit), without a VEBA. I have also posted on VEBA board. ------------------

PLR 199930015 recently held that LTD coverage provided by a VEBA and obtained either through purchase of new coverage or by modification of existing plans is attributable to employee contributions for purposes of Code Section 104(a)(3), even when the employer acts a conduit for the purchase of coverage or the payment of premiums, such that benefits received under such plans are excluded from employees' gross income. Specifically, employer either purchased coverage and reimbursed itself through after tax payroll deductions, or paid for premiums and include premiums in employees gross income, with additional payment to employees to compensate for cost of coverage & additional income tax burden. Am wondering if the result was directly related to use of a VEBA or if it would also apply to the same practice (employer as conduit), without a VEBA. ------------------

Has anyone ever heard about/worked with HealthCare Compensation Strategies, a subsidiary of Management Consulting Group? Any opinion as to the value of their services? ------------------

So, if a retiree medical plan is terminated under a scenario in which COBRA is inapplicable (i.e., employer terminates ALL group health plans), it is possible that a retiree who has a preexisting condition will be subject to an exclusion period under a new policy (i.e., will not be able to reduce the exclusion period by demonstrating prior coverage via HIPAA certificate)?? ------------------

If an LLC wants to provide deferred compensation benefits to its employees, can it do so to an employee who is also a limited partner in a partnership that comprises one of the LLC members? Could the employee be deemed a member of the LLC for compensation purposes? ------------------

If an LLC wants to provide deferred compensation benefits to its employees, can it do so to an employee who is also a limited partner in a partnership that comprises one of the LLC members? Could the employee be deemed a member of the LLC for compensation purposes? ------------------

Looking for web resources on this type of entity; particularly tax aspects. ------------------

Is early termination of COBRA permissible where a business terminates all group health plans, but where the business owner obtainsan individual health policy for himself, only? In this case business owner is trying to deprive ex-wife of COBRA rights. Would like authority that his individual policy is a 'successor plan,' or similar authority creating obligation to continue ex-wife's coverage. ------------------

Is it also a PT if the company that the IRA invests in is not a start up but is a closely held company that employs the IRA beneficiary as an officer? The officer hopes to purchase, through his IRA, an infinitesimal percentage of the total shares outstanding. The company will probably go public within the next year or two. ------------------

How about if this is done through a cafeteria plan; i.e. employees who forgo group health coverage because they have group coverage through a spouse's job receive less than 100% of the available cash benefit (but receive the amount if it is all allocated towards nontax benefits). See my post on the Cafeteria plan board.

Employer wants to limit cash benefit available to employee who has medical coverage through a spouse's employer's plan. If monthly budget is $150, and cost of individual group medical coverage is $100, plan would give $50 to employee who selects the coverage, but only a percentage of the cash benefit that would otherwise be available to the employee who foregoes coverage because he/she is covered under a spouse's plan. ------------------

A 401(k)plan currently under audit has been asked to correct an error in which a matching contribution was made to a HCE based on total comp., not comp. limited by 401(a)(17). The IRS has not identified two similar occurences that took place in the year under audit. Due to the size of the plan (over 200 participants) and the small amount involved (total overage is less than $3K), the two combined errors probably constitute an insignificant error which could be corrected under APRSC, despite the audit. Presuming the employer corrects under APRSC, shouldn't the employer disclose the two additional, corrected errors to the IRS? ------------------

Looking for any insights or information on structuring bonus or other "compensation" strategies for LLC members. Ideally the arrangement would be the LLC equivalent of a nonqualified deferred compensation plan. (Have already posted on that message board, to no avail.) ------------------

There are two basic Code sections - Sec. 127 for educational assistance plans (undergraduate education only; need not have connection to employee's job/career; reimbursement limit of $5,250 per calendar year)and an educational institution's reimbursement for tuition of employees and their dependents, under Code Sec. 117(d). So the answer depends upon whether you are a school or university, or not.

I am going to resurrect this debate and add another twist to my question. First I would like to summarize what I understand to be "the rules" for a defined contribution plan QDRO, with the AP having a segregated account or subaccount. 1. The AP can name a beneficiary to receive benefits that remain undistributed at her death. Even though she has the status of a beneficiary herself, she has a right to "no greater than" that of a participant to name a beneficiary. See. Treas. Reg. 1.401(a)-13(g)(4)(iii)(B). 2. There is little agreement among practitioners as to whether the AP's beni must him or herself be an AP. See several good arguments why the beni need not be an AP in Paul Hamburger's "Guide to Assigning & Loaning Benefit Plan Money." 3. Regardless of whether the AP's beni is or is not an AP him or herself, the beni's receipt of the remainder of the AP's share may violate the required minimum distribution rules. This raises my additional question: 4. QDROphile states that in some instances the AP's estate can receive undistributed benefits at her death. What about her issue, per stirpes? If the issue receive her remaining benefit in a lump sum at her death, would this still violate the rule that the benefits not be extended over the life of an AP and her designated beneficiary, as set forth in Prop. Reg. Sec. 1.401(a)(9)-1, Q&A H-4?

An insured group health plan wants to exclude dependent spouses if they are eligible for coverage under their own employers' plans. Dependent children can be covered regardless of other plans. Alternatively, allow all dependent spouses to participate but impose a higher charge on spouses who have alternative coverage available. Excluding any discrimination issues based on marital or family status, is this a problem? I am aware of the case law against "escape clauses" applicble in the coordination of benefits ("COB") area and am wondering if the concept extends from the participant to beneficiary level. ------------------

How long can an alternate payee (AP) leave her share of a participant's account in a plan (presume a MPP Plan/PSP arrangement). The participant is a non-5% owner and has reached NRA and may begin drawing on his benefits while still employed. The AP wants to leave her share of his benefits in the plan longer. Can she postpone distributions until the participant would be required to take distributions under 401(a)(9)? Or must she begin receiving distributions when he does? Is the answer different if she (a) does not have segregated accounts under the plans or (B) does have segregated accounts? ------------------

Re: early retirement subsidy, please also see In re the Marriage of Lehman, 98 Daily Journal DAR 5539 ( May 28, 1998) - enhanced benefits were awarded.

Looking for a recent PLR stating that an employer's contribution of unused sick leave to a qualified retirement plan does not constitute current taxable income to employees and is deductible by employer. PLR 9827040 is somewhat similar but I believe the ruling I am looking for is more recent. ------------------

Where a plan participant has received inadvertant overpayment of retirement benefits, can plan fiduciaries obtain a prejudgment writ of attachment with regard to the overpayment? By virture of holding the writ, can they conduct extraordinary discovery regarding the participant's use of the overpaid benefits?? ------------------

Where does one find the "implicit price deflator of the GDP as calculated by the Dept. of Commerce and published by the Survey of Current Business," which is needed to calculate COBRA premiums for self-funded plans under the past costs method?? ------------------