Hoard1

In making a determination if a partial termination has occured can you ignore plan participants who have not worked over one year or have attained age 21? The Plan's eligibility provision is more liberal than this.

Is there any relief for an Employer who adopts a 401(k) Plan after May 1,2000 effective back to 1/1/00 who would like to use the 3% non-elective safe harbor contribution?

Employer has an ESOP plan in which 5 employees with over 5,000,000 in distributions will be due in two years. Plan document allows for immediate payouts or installment payments over 5 or 10 years at the election of the participant. Employer can't pay the put with out overly encumbering the business. Anything they can do?

I have not had to terminated a DB Plan for -awhile. DOes the Service still require a Required Statement in accordance with Notice 87-20, 87-46 and Section 1124 of TRA 86. If so does some one have a current one they would be willing to share? jay.scholz@padgett-cpa.com Thanks

Does anyone have a current IRS Required Statemnt used in connection with the termination of a defined benefit plan. I have an old one that incorporates Notice 87-20, 87-46 and Section 1124 of TRA 86 but nothing since than. I haven't terminated a DB Plan in awhile. jay.scholz@padgett-cpa.com

A Plan excludes all highly compensated employees from participation as a class. The Company purchases another company and credits past service for purposes of participation and vesting. Are the HCE's of the aquired company HCE's for first Plan Year with new Company ( they did not earn more than 80,000 with the Plan Sponor in the prior plan year?

Employer who is the sole participant in a DB Plan would like to terminate it effective 7/31/00 and start a new one effective 8/1/00 because other employees will participate as of that date and he does not want to comingle prior assets. Aside from combining benefits for 415 is anything else I should be concerned with adopting this new Plan.

I'm looking for a way to require employees to make contributions a 401(k) Plan. Either mandatory or condition of employment although that seems to mean the same thing.

davef On your prototype are these COE contributions employee deferrals or is the employer reducing compensation and than making a contribution in the same amount as a QNEC? I'd like to talk with you further about your prototype with an eye toward purchasing a document. Please contact me at jay.scholz@padgett-cpa.com or on the board. Thanks

To answer my own question Rev Proc 90-49 has a worksheet attached to the end of it prepared by Jim Holland which goes through the caculation using valuation interest rate to increase assets to the end of year.

Our valuation systems is calcuating interest for full funding limit for OBRA and RPA at the OBRA|RPA interest rate to bring the values forward to the end of the year but is increasing assets at the valuation rate. Is this correct? Is there a cite? I understand it may be part of an IRS announcement but I can not locate it.

In the adsence of GUST Amendments from prototype providers how are people terminating DB Plans with the Service?

Dr. A also teaches at a University. She does not have any ownership in the institution. Would any benenfit earned in their Plan have to be considered for 415 purposes?

Corporation C is owned 100% by Dr. A. This corporation develops and sells Medical software. No medical licensing is required to be in this business. Dr A ownes 51% of a Medical Practice with another individule who is not related. The Practice provides no services to Corp C and there is no sharing of employees. I read the Brother Sister rules to state that Dr. A only has common ownership of 51% and therfore does not pass the 80% common ownership test. Although she does pass the 50% identical ownership test she does not pass both and therfore is not a Brother Sister Relationship. Can Corp C set up a Defined Benefit Plan and not include the Employees of the Medical Practice. I think they can. Am I missing anything?

Is there a distinction of which contributions that are used in cross testing a plan under 410(B) and 410(a)(4) ie Profit Sharing, 401(4), Match QNEC QMAC & Safe Harbor. Any cites would also be helpful. Thanks. JTS [This message has been edited by Dave Baker (edited 12-15-1999).]

May an Employer that started business 8/1/99 make the effective date of a Plan 1/1/99?

Also, does anyone have a copy of the IRS Field Directive that talks about seasonal emloyees? I lokked for it through my usal sources and it appears that it is not yet posted. Thanks

To answer my own question ... .1.410(a)-4(B)(ii).. if the employee has not incurred a break in service they must commence participation immediately upon return. I've seen documents that say rehires commence participation on the next entry date. Is this ok? Also, does the fact the employee has not completed 12 months of consecutive service have an impact on this situation.

410(a)4 outlines time for participation. If an employee separates from service prior to first day of plan year or date six months after when would they participate if rehired in next plan year. Date of rehire, next entry date or some other time. Thanks

Employer hires seasonal employees each year for a period of four to six months April to September. Many of these employees are over age 21 and work over 1000 hour in the season. If these employees are rehired in the next season, when must they participate in the plan( date of rehire or next entry date July 1)? From prior posts on the BB I see that exclusion of these employees is difficult because of an IRS Field Dirrective and 410(B) coverage rules. Has anyone come up with any approaches to exclude these employees other than: 1) Write HEC's out of Plan and establish non-qualified program for them. 2) 410(B) carve out to exclude enough HEC's to pass coverage.

This isn't about paper work but there is a 210 day requirment after the end of the Plan year in which the Participant terminates to provide them with a statement of their vested benefit.

Me too

If a Plan has an age & service requirement less than the statutory minimum can it still use 21 & one year of service for the exclusion under 410(B)? Any cites?

I have been told that these are only the Safe Harbor Test for establishing financial need and that an Employer may ellect in their Plan Document not to use the Safe Harbor definition. Has any one else had experience with this?

May a Plan be amended to require Mandatory 401(k) contributions as a condition of employment? Has anyone had experience with doing this?