LIBERTYKID

the plan clearly permits participants to receive distributions in the form of stock or cash. It is publicly traded, so no put, but the company does buy back the stock during a period of time.

Publicly traded ESOP plan provides for distributions to participants in the form of cash or stock. It has been interpreted to mean that a participant who has shares of stock in his or her account can sell the stock and receive cash from the trustee, which has happened. The sponsor wants to terminate the ESOP and require participants to take the shares of stock in their accounts in kind, and eliminate the cash option. Can this be done? The regs don't seem to permit exactly this but if anyone has a different opinion let me know.

If anyone has experience drafting a 401(k) church plan for a client and may want to pick up a referral, please contact me.

How are assets of a Church qualified defined contribution plan held? If exempt from ERISA I assume there does not have to be a trust, but can there be a trust? Are most held in custodial accounts?

Can anyone suggest a plan administrator's manual for 403(b) plans?

A 403(b) plan provides for salary deferral, after-tax voluntary, and matching contributions. In a 401(k), the after-tax and match are subject to the ACP test. Are after tax also subject to the ACP in a 403(b)? Since salary deferrals in a 403(b) are not subject to the ACP test, I thought there might be a way to not test the after-tax voluntary.

A defined benefit plan permits a participant to designate a nonspouse beneficiary. The form of benefit is a life annuity. If the participant dies at age 45, the plan provides that the nonspouse beneficiary can wait until early retirement age (55) or normal retirement age(65) to commence receiving distribution. But the IRS model 401(a)(9) language appears to state that the benefit to a nonspouse beneficiary must commence by the end of the fifth year after the date of death. But I read reg. 1.401(a)(9)-6 q&a 10 to say that the five year rule can be ignored. Which is correct?

A 401(k) plan provides for a safe harbor employer contribution of 3 percent. It wants to make an additonal employer contribution for only certain employees (lets assume a nondiscrminatory group). Is this permissible?

Company A owns 50% of company B. Company B wants to set up a KSOP and use the stock of company A as employer securities. Code Section 409(l)(4)(B) appears to lower the controlled group percentage to 50 percent for this purpose, to the extent I understand it. Can someone verify that I am reading that section correectly?

I know age 50 catch ups are excluded from the definition of annual addition, but are the special 3,000 a year catch-up amounts excluded from the defintion of annual addition for 415 puposes?

Can you terminate a safe harbor 401(k) plan that provides for the 3 percent employer contribution in the middle of the year without a financial hardship? The regs aren't clear. I think you can provide a notice to participants, the 3 percent for the period the plan was in existence, and subject the plan to discrimination testing for the year, but I am not sure. Anyone agree or disagree?

Code Section 409(o)(1)© provides that the plan must provide that unless the participant elects otherwise, the distribution of the participants' accounts will be in substantilly equal period payments over a period of 5 years (extended for large account balances). Does this mean that the plan has to offer installments? Does this mean that a plan can't just offer a single sum payment option (permitting distribution of stock or cash at the election of the participant)?

A 401(k) plan provides for salary deferral and matching contributions. There are 10 investment options, one of which is employer stock. Currently, less than 30 percent of all plan assets are in employer stock. In order to get a tax deduction for the dividends, it was suggested by an advisior to amend the plan to be an ESOP. The proposal is to treat the employer stock fund as the ESOP portion of the plan. The amendment would have the necessary restrictions and requirements to be an ESOP, but the plan design did not change. Participants can still elect to have deferrals and matching contributions invested in any investment, inlcuding employer stock. How does this plan design meet the "primarilly invested" in employer stock requirement? Would the plan have to require at least that the matching contribution be make in the form of employer stock for it to be an ESOP? Any other issues?

The 90 day period for considering certain distribution options is extended to 180 days. If the plan doesn't mention the 90 day period, is the extention to the 180 day period an item that must be mentioned in a PPA amendment (yes I know it does not have to be amended now)?

Is anyone aware of a sample or model supplemental unemployment fund documents or summary plan descriptions that I can review?

A 401(k) plan will match either voluntary after-tax or deferral contributions. What are the restrictions on withdrawals of after-tax contributions that are matched? I know that generally if the after-tax contribution is required to be made as a condition of employment, the after-tax contribution could not be withdrawn at any time. But I am not sure what the withdrawal restrictions are with regard to a matched after-tax contribution. Any authority?

Does anyone have a good summary of how the Pension Protection Act affects 403(b) plans? Also, do the provisions that require a 75 percent QJSA and extent the notice period to 180 days apply to 403(b) plans?

I understand that for rule of parity purposes, if a participant makes a salary deferral to a plan that person is vested and the rule of party can't be used to forfeit vesting service, but I am unsure how the final regs changed things with regard to repayment upon rehire. If participant has 10 dollars in a salary deferral account, and 85 dollars of nonvested money in the employer account, is the participant required to repay the 10 dollars in order to have the 85 dollars restored? Or does the plan deem the 85 dollars repaid upon rehire?

If an employer timely provides a safe harbor notice but does not amend the plan until after the begining of the safe harbor plan year, what do you think the chances are that the IRS may in EPCRS permit the retroactive amendment? The IRS did see the amendment and issued a determination letter on it already.

Plan has a normal retirement date of age 65. Lost participant terminated before age 65 is found at age 67. If the plan payments are retro to age 65, I understand that the regs require interest on the back payments. But does the spouse have to consent to a joint and survivor annuity retro to age 65 by seeing a comparison of the spousal benefit at age 65 vs age 67? Is the QJSA a greater benefit commencing at age 67 than age 65?

Employer establishes a SEP through the adoption of a SEP Adoption Agreement with an insurance company in 1997, and made contributions through 2001. This year the employer set up a 401(k) plan, and does not intend to contribute to the SEP plan. Does the employer have to amend the SEP for GUST, etc.? Does it matter that the owner still has an IRA funded with the SEP contributions? Can the owner convert the IRA to a "traditional" IRA to avoid updating the SEP?

What the employer may have to do is to stop the repurchase of shares for a period of time until the deal can be disclosed. What I am trying to come up with is any authority to stop the purchase fo the puts at this time. What gives the employer the authority to not purchase the shares at this time?

Privately held company is purchasing stock from terminated ESOP participants based on immediately preceding valuation date. The company is having discussions with a potential buyer re: its sale at a substantial premium to the prior valuation. The participants who terminate are not asking about whether the prior valuation is correct or the business prospects of the company. Should the company continue to buy stock from the terminated participants?

Company A and company B are both affiliates and both maintain defined benefit plans. Employees may transfer employment from company A to company B. Employer A would like to transfer the employee's benefit liability from plan A to plan B in such a situation, and plan B has agreed to accept the liability if an appropriate amount of assets are also transferred. Assuming benefits rights and features is not a problem, the employee is properly notified, and that both plans are amended to provide for transfers, what other issues are there? How should the plan amendment be written? How do you describe the amount of assets that are being transferred?