JanetM

You got me on that one - Just reread the policy and it does not say. Just that you promise to repay if you leave the company within one year or are terminated for cause. What would that do- the state law part I mean. I ask because I start classes for MBA in 3 weeks.

My company does require you to sign a note for all tuition reimbursement. The Note states that if you do not work for an additional 12 months after receipt of reimbursement, the amount must be repaid. Each reimbursement requires a new note to be signed for that amount. So if you take 4 classed a year, you have 4 notes.

I may be missing some thing in this - but here is my two cents anyway. My take is that you can only move (transfer, sell, distribute - sematic games we play) assets between plans if triggerd by a distributable event in the case of a single participant. Only exception to that is a plan merger/ plan spin-off that effects all participants. I do not see how you can distribute the assets at this time unless the plan allows inservice.

For such a small plan - with low start up assets - I would ask the CPA firm handling the other work to take this on. In prior life I did TPA work for CPA firm. For a small plan like this we set up individual accounts at mutual fund house or brokerage firm (we used AIM, Vanguard, Putnam etc. ). We changed fee for document, and 5500 - as there is virtually not recordkeeping required with individual accounts. Fund company changed small fee per account ($20 to $50) to handle investments. I would not go with a bank - my experience is that they charge too much for plans of this small size.

Sounds like what my company did - except we did not freeze the acquired DC plans. My company (A) bought another company (B) that had 3 DC and 4 DB plans. We intend on merging 2 of the DC plans into the A Plan. Upon the completion of due diligence we decided to wait on merging the plan until the audit window closed. This was decided because the company (B) and the record keeper were unable to produce ALL the documention requested during due diligence. It was simply a matter of playing it safe with the A Plan. Once the time has passed and we are confident there are no ghosts to haunt (taint) us- we will merge the plans.

Kirk can you post a link to it if there is one available. I would like to read the report. Sound interesting.

You could also argue the loan is not in default yet. The rules say the loan is in default at the end of the quarter following the quarter in which the last payment was made. Since no payments have been made - TECHNICALLY - the loan is not in default. Participant could make one payment in 2002 - then default this year.

This is a tricky area - we bought a company that had DB plan and 401(k) & profit sharing plan. One of the owners had done a TEFRA election back in 1983 for both DB and DC plans. Election was to start distributions one year after he ceased working for compnay (at the time of purchase he worked and was 75). We bought the company and promptly spent lots of money on atty's and actuaries to interpret this election. Final decision was that any change to the election would cause it to be voided. Note that that is any change at all - prior to or during the performance of the election would cause that election to be void. Once void the penalties and wrath of the IRS would descend seeking the RMD's that should have been taken and the 50% exise tax on those RMD's not taken. It is interesting to note that in our case the TEFRA election had the effect of there being no RMD's until the age of 76.5 - one year after the acquisition.

Why not just make it a safe harbor plan and forget the testing?

Yes it is legal - you can open a new IRA (or Roth) every year. The limits on contributions are set by IRC. Why would you want to have multiple accounts - each with a small balance and incurring fees? I would want to consolidate the IRA's or Roths to single IRA or Roth. This would lessen fees and give you more opportunity to diversify your holdings.

Thanks! I will keep that card up my sleeve - may need it if the time comes to get a number for the liability. The Union is not aware of the possible withdrawal - the contract is up for negotiation soon. I hesitate to contact the Plan because of this and do not want to taint the negotiations. Again thanks for your help.

Thanks for all the comments. I will have to consider contacting the union. During a recent acquisition the Plan told us they do not calculate withdrawal liability unless the they are sure it has been triggered.

Does anyone have experience with calculating withdrawal liability from a union national pension fund? Or if there are any resources that could help me?

SBJPA was what came to mind first.

The AICPA audit guide for Audits of Employee Benefit Plans (5-1-2000 edition) has a list of things that should be addressed. This is in Section 12.11.

Hey, look on the bright side, HIPAA may not be funny but at least it does not violate the unpronounceable acronym rule.

The sole proprieter should have some documentation of the calculation in his prior tax returns. The prior CPA should have some idea of what formula was used. Since this is sole proprieter with 5500EZ - the most that could be contributed to a DC plan is set by the IRC. If this is a DB plan the CPA should not be doing any calculation. Tell the sole proprieter to have the CPA look at prior years tax returns. (if this does not answer the questions - find a new CPA)

I did read the entire thread - your point at the end is the sticky point. Last year an employee who is only in the sheet metal workers national pension fund got the box checked. She argued the box should not be checked - had a CPA call me on it too. CPA was Certified Pain in the A** about it - Said the rules are: "If you are eligible to participate in YOUR EMPLOYERS'S defined benefit plan for the plan year that ends within your tax year, you are covered by the plan. " This is the same as you have in your post - the key is the employees' employer is not the sponsor of the plan. Sheet metal workers national union is sponsor of plan.

I am putting this on the 401(k) page because nothing else seems appropriate. We are running our W-2 programs in test and are reviewing the program. The question is regarding who gets the box checked and what the program looks for. We check the box for active participants in all plans covered under 401(a) {all of our DC and DB plans}. Do we check the box for those employees who are active under a multi-employer plan - such as those in the Sheet Metal Workers National Penion Fund? The W-2 instructions do not say anything regarding who sponsors the plan. Any experience or even an educated guess??? A cite or an idea of where to start looking would also help.

Since the plan uses the accrual method of accounting - you must count as distributions all checks issued in 2001. The date on the check will determine the year paid. Not the date the check is cashed.

In one of our DB plans we had situation where a deceased elected 50% J&S - surviving spouse cashed checks for 3 months (had direct deposit to joint account) before we were notified of death. We told spouse she had choice between paying back three months of checks or not getting a check for 6 months. We were betting the spouse would live at least 6 months and all would be even. We have also had situation where participant was paid twice a lumpsum (under $5,000) amount - Legal department sent her a letter saying she knew she had received too much and would have to pay it back. We are collecting monthly checks from her till it is paid in full. Threat of legal action was all it took.

I am a plan administrator for my company. We have three 401(k) plans that do not cover union. I am interested in how the EGTRRA provisions will be adopted by other plans who have ee's over 50. We have a couple of choices: 1. Limit the deferral % under the plan so participants can use the catch up provisions. Plan says limit is 12% - participants do the 12% allowed and use the catch up provisions to max their contributions. 2. Do not limit the deferrals - let people defer up to 75% of their pay. This cenario would only allow those who defer over the 401(g) to use the catch up. I would like some feedback on what you think the majority of plans will do.

Participant, age 76 and prior owner of Company A, says he has valid TEFRA eleciton for the Company A DB plan. He can not produce the election form. What, as plan administrator, is my responsibility when it comes to making MRD. This is a new plan for me - my company recently bought the assets of Company A and assumed sponsorship of the DB plan.