Appleby

Are we sure?… A friend and I have been discussing a similar issue at length, and it seems to me that Wilma had until December 30 to rollover the balance of Fred’s account, without being required to take an RMD. If she waited until December 31, then she is required to take an RMD for 2007, based on her life expectancy.

Except that the phase out range differs. If you are an active participant, but your spouse is not, your phase-out range is $83,000- $103,000 If you are not an active participant, but you are married to someone who is an active participant, your phase-out range is $156,000- $166,000 These are 2007 figures

It does not apply to qualfiied plans. See http://www.retirementdictionary.com/articles-gifting.htm

Yes. You can convert your traditional IRA assets to a Roth IRA, as long as your tax filing status is not married-filing separately. The other requirement is that your MAGI does not exceed $100,000. But it appears this is not an issue for you at this time

See http://www.retirementdictionary.com/irs-2008.htm As to how they are determined, see http://benefitslink.com/boards/index.php?s...ic=33636&hl and http://benefitslink.com/boards/index.php?s...ic=36943&hl

The custodian is required to report the amount as ‘taxable amount not determined’, as they would any other regular IRA distribution. But , as jevd indicated, if the rollover is due to misinformation from the employer/plan sponsor, the distribution amount from the IRA would not be taxable to the participant. The non-taxability of the distribution would be reflected on the 1040, and a note of explanation should be attached

Ineligible rollover contributions not removed timely are automatically deemed regular IRA contributions for each succeeding years, until removed from the IRA. Amended 1040’s may need to be filed to show the amount as IRA contributions

But we are not pronouncing the 'H', are we? Arent we saying "Ech SA"?

See http://www.retirementdictionary.com/IRA.htm for IRA limits

EGTRRA took care of those up to 2010

Other plan limits available here http://www.irs.gov/newsroom/article/0,,id=174873,00.html

I agree. Like "An hour before midnight", it would not be "A hour before midnight"

2008 limits for Roth Contributions, IRA Deductibility , Saver's Credit... http://www.irs.gov/pub/irs-drop/rp-07-66.pdf

It’s on the participant level. The two-year period starts the day the first contribution is made to the individual’s SIMPLE IRA

His first RMD is due 12/31/2007, year the individual reaches age 70 ½. He gets an extension for the first RMD year, which allows him to satisfy the RMD by April 1, 2008. But as noted earlier, if he takes any distribution in 2007, then that amount is considered part of the RMD and not rollover ineligible. In other words, if he distributes any amount in 2007- up to the RMD amount, he has given up the right to defer withdrawing the RMD amount withdrawn until the following year.

How unusual. Usually, what I hear is " He wants to cover himself, but not the employees".

I agree with Bird that the repayment of the fee to the Roth IRA would be treated as part of your Roth IRA contribution. For the next time the annual fee is due, you can pay it to Roth IRA before it is charged to the account. This would not be considered a reimbursement, and therefore not considered part of your Roth IRA contribution. If your custodian provides you with advance notification of the due date for the fee, they may also provide instructions on how you can pay the fee out of pocket-but this out of pocket payment must occur by the due date…

For a profit sharing plan, the individual is considered an active participant the year that the contribution is deposited to the participant’s profit sharing account…even if it is for the previous year. For instance, if the 2007 contribution is deposited in 2007, the participant is an active participant for 2007 and the W-2 for 2007 must be checked If the 2007 contribution is deposited in 2008, the participant is an active participant for 2008 and the W-2 for 2008 must be checked. This is different for money purchase pension plans…where the participant would be an active participant for 2007 ( using the examples above), regardless of which year the contribution was deposited.

If I had to vote, then this would be my choice...which could techincally be treated as SCP ...assuming it has been less than 2-years since the error occurred Reversing the funds to the 401(k) would not correct the error...since the plan processed a direct rollover, as per the participant's request, the funds can only be returned to the plan as a rollover...and that is permitted only if the assets were eligible to be in the SIMPLE -which is not the case…

A SIMPLE 401(k) would not permit more contributions than a SIMPLE IRA. In fact, compensation allowing, it is possible to get more in a SIMPLE IRA than a SIMPLE 401(k).. because the compensation cap applies to SIMPLE 401(k) matching and non-elective contributions, while it applies only to non-elective contributions to a SIMPLE IRA. Therefore, if that is your primary goal, you are heading in the wrong direction…

Regarding the matter of the 1099-R, one should be issued with a Code G for only the amount that is rollover eligible. The letter to the participant should explain that the $400 is not rollover eligible, and that it should be removed from the IRA along with any NIA by the individual’s tax filing deadline-including extensions for the year the amount was credited to the IRA, or be subject to a 6% excise tax for every year it remains in the IRA. The realization that the amount cannot remain in the IRA without penalties usually helps the IRA owner to understand that leaving it in the IRA is not a wise choice. The IRA owner should contact the IRA custodian, with instructions to distribute the amount from the IRA

Interested in any feedback on Gary's calculators added at http://benefitslink.com/boards/index.php?s...mp;#entry153309

Gary, Can QP-SEP Illustrator handle a partnership where owners have a written agreement to allocate "non-owner contributions to the SEP" equally to 2 of the 3 partners (e.g., A - 50%, B - 50%, and C - 0%)? Denise

Yes. But by definition, the IRA would no longer be a Rollover IRA. Definition at http://www.retirementdictionary.com/Rollover-IRA.htm

LOL So….defined benefit is the dog? As in the dog is stronger than the cat and can beat-up the cat if he wanted to?