JanetM

Pat, I have never seen an IRS or DOL examiner question 100% vesting for partial termination when the group being vested and benefiting was mostly NHCE.

Mistakes in calculations and late payments are not PTs. As to the lump sum, if it is paid from the plan the statutory withholding is 20%. The effective take rate the recipient pays will depend on AGI and deductions/credits eligible for when filing their income tax.

Larry, all our plant closures involved DB plans not DC. Plant closure can be 2 to 3 year process and it can be partial or complete. The rev ruling just added a new form to HR files. It is termination letter. Form letter that you can check the box of why you are leaving or write in reason - there is voluntary and involuntary. These are used to show who left and who left for cause. We figure if you show IRS agent stack of letters that are signed by participant and HR rep that clearly say the person is leaving voluntarily for more pay, better hours, closer to home, relocating spouse........ we have made out case. For those who terminate due to death, we keep copy of death cert or obit with the form - then we vest them.

They have not had severance from employment. Best option is A - transfer assets to Bs plan. This would include loans. This eliminates the problem of employee continuing loans payments and facing default. This will reduce expenses incurred from having two plans - record keeping, audit, ect. This will also keep money accessible for hardship and loan. Forget the idea of distributions now or later. This only encourages participants to make ill formed decision. Don't see negative aspect to transfer of funds to new plan. IMHO the only one who would see this as negative is participant who wants distribution so they can spend it or financial advisor hoping to make big fees on someones rollover account.

This is always facts and circumstances with 20% as the general rule that marks partial term. In your case you didn't involunarily term anyone based on fact pattern given. To count the number affected participants you look only at involuntary terms not voluntary. Since I don't see that you have partial termination, what is impact if you do vest those who stuck it out past he announced sale date? In all our plans, when plant closure is announced we also mention that those who stay until layoff are 100% and anyone who leaves before then is deemed voluntary and not vested.

Most daily valued plans don't accrue contributions for this very reason. They post contribution then someone has to come up with more funds that contstitute the earnings if contribution dollars aren't deposited quickly.

The plan auditor will ask for the general test.

Kman, you get off lucky on this. Amend return for higher income tax (possible penalty and interest) if the service takes time to review the filing. ERISAnut explained the gotchas of make the 2006 contribution now. The one other thing, if you make the contribution now, has anyone terminated and taken balance who would be due contribution?

deferral 16,500 and c/u 5,500

It looks like you will be needing to have the plan audited in the future due to head count. What ever you do be cognizant that the TPA will make or break the audit and also impact the cost of the audit if they or employer can't provide the necessary information. One thing you didn't mention was the 100 participants, what do they want and need? Target date funds, hand holding, contstant reassurance investing is a good idea, a swift kick to motive them.............................

Holy Smoke - all the limits jump even if the aug & sept rate fall to 215.

Do you mean Investment Policy? Don't know what you mean by Administrative Policy, seems to me it is the plan document that instructs you on how the plan is administered. There are various admin policies that we have that cover the processing of loans and QDROs.

And if that number is over 100 you need audit.

The language in the Union plan will decide who is and isn't eligible.

If buyer did stock purchase they also acquired the plan and will be treated as they have been plan sponsor all along. That means when you merge the aquired plan with buyers plan you have look back year and all those fun hoops to jump through. If person is HCE with the acquried company in 2008 and they make over $105K in 2008 they will be HCE in 2009 regardless which plan they are in normally. You mentioned the top paid group election, without actual census data that can't be answered by me. That depends on total number or HCEs and the exact comp for each one.

Well if you bought a company and assumed a plan you pretend you have been sponsor all along. If you bought company (assets) hired all the employees as new employees and start new plan from scratch you don't have prior year to look back to. Need a bit more detail. Are these HCEs in buyer plan? Are you giving credit for prior service?

Can you explain what you mean?

I have to assume you already have an emergency fund that would provide up to 6 months living expense. So now that you are ready for today you are thinking about tomorrow. If you don't have this yet, I would not advising tying the funds up in a Roth now. Roth is great idea but it doesn't exist in a vacuum. Your entire financial situation must be assessed to decide if it the right thing at the present time. If you want to learn how to manage/invest your funds you either have to read a lot of material (read this as large time investment) or spend a little money to get someone point you in the right direction. There are financial planners/advisors who will look at what you have & your goals and then give you differnent options of how to get there. After that you are on your own.

It depends on timing. SFAS 158 is effective for publicly traded company for fiscal year end after 12/15/06. For non .publicly traded it is effective for fiscal year ended after 6/15/07. The actuary will normally provide the bulk of the data the company will use to comply with FAS Here is Financial accounting standards board site - it is this body who writes the rules. http://www.fasb.org/st/summary/stsum158.shtml

If only one person it could. But if you are going to give Dr. service credit and there is an employee at his practice I say you can't.

The dollar cost of match/profit sharing is usually recouped by the goodwill, lower turnover, and happy workforce after a merger/acquisition. My employer buys and sells 3 or 4 companies a year. One acquisition we did that didn't offer credit for prior service was a disaster. Voluntary turnover went from 5% to near 60%. So instead of being profitable from day one for small expense, the company struggled for 2 years.

I can't think of specific reg - but fiduciary liability is the reason. Just because there is not market now does not mean there will never be one. What you will have to do is set up an account for it with another trustee and give market value of zero and cost basis.

Done all the time for vesting purposes. Doesn't cost anything - why not?

You can't mark the form up. It is machine read. 5500 preparers manual says IRS was supposed to issue guiadance in early 2008. I have searched and found nothing. I am going to say the reason the instructions read that way do is because 2008 was originally the year we were all to filed electronically. Since that has been delayed until 2009 I think if you used to used the 2007 form to file 2008 final you would be okay. If not EBSA will send you a letter.

We used to mark them up too. Now the instructions say this. "If you are filing a final return, and the form is not released by the due date of the final filing, use the most current-year form that is available. If there are any changes to the questions on the new form, the EBSA may request further information from you. Caution: The 2007 Instructions for Form 5500 specify that certain plans may not use the 2007 forms to satisfy their 2008 filing requirements for a short plan year. The agencies are expected to provide additional guidance in this regard in early 2008." Search of IRS site found nothing.