B21

Just to be clear, the corporate shares would attribute to the partnership because the corporation is a partner, therefore resulting in an ownership affiliation?

I know an individual partner would not be considered an employer for plan sponsorship purposes. But what about a corporate partner? Can an individual partner establish an S-corp & transfer his partnership interest to the S-corp & then establish a qualified plan?

I have a client that needs to have their SARSEP document restated for PPA 2006. They are currently on an individually designed plan because they are ineligible to use model Form 5305A due to sponsoring another retirement plan. Also, Vanguard (the IRA custodian) doesn't have a pre-approved prototype document. If I restate the plan as an individually designed plan, can it be (or necessary) to submit to the IRS for a determination letter? I noticed on Form 5300 that SARSEP is not listed as a plan type.

I am processing a 401k hardship distribution for a participant who normally contributes the elective deferral max each year. There was a regulation that stated an employee's annual cap on elective deferrals for the year following a hardship distribution is reduced by the amount of elective deferral contributed in the year the employee received the hardship distribution. I do not see this requirement in the current regs. Was it repealed?

Once an employee who participates in a NDC plan becomes vested in his/her benefit( no longer subject to substantial forfeiture) is the employer required to set aside funds to pay the employee his/her benefit in the form of a lump sum or installments? Are these funds then considered funded & therefore protected from the employer's creditors?

I was thinking of a SEP for 2013 as an alternative but wouldn't the Simple plan have to had been terminated prior to 1/1/13?

I have a client who is a sole proprietor & sponsors a Simple IRA. She was unaware that the deadline for her to deposit her 2013 deferral contribution was 1/30/14. She thought she had until her 2013 Schedule C income was determined. If she makes the deposit now can she correct under the IRS VCP? Would an IRS Compliance letter allow my client to take a 2013 deduction for her deferral contributions or can the deduction be taken in the year of correction?

I have a client which is a partnership that sponsors a calendar year 401k plan. They are taking a 2012 profit sharing deduction which includes allocations on behalf of the partners & their employees. Since the partners' profit sharing contributions are deducted on their individual 1040s, do they have until 10/15/13 to deposit their contributions & 9/15/13 (the partnership return due date) to deposit the profit sharing contributions on behalf of their employees? Assuming the partnership's & individual partner's 2012 returns are on extension.

The purpose for my question is both to get a general understanding of what qualifies as a NQDC arrangement & then to determine which ones are subject to 409A. The IRS link is helpful & should point me in the right direction. Thanks to to the both of you.

I may be oversimplifying my interpretation of a NQDC plan, but it's my understanding that basically an arrangement where a select group of employees will be eligible to receive wages on a future date upon the occurrence of a certain event(s). Therefore, would both the following arrangements constitute a NQDC plan? Employee elects to defer a portion of his/her current salary to be paid at retirement or upon termination of employment. Employer agrees to pay employee $100,000 annually for 7 years upon retirement. No employee deferral contributions.

That's a good point regarding Form 5498. I'll explore further. My initial inclination is to say that the taxpayer would not receive credit for a timely deposit if the check did not clear.

Does anyone have any guidance regarding a situation where a client took an IRA deduction on his 2012 tax return, made the contribution by check prior to the 4/15/13 deadline & then the check was subsequently returned for insufficient funds after the 4/15/13 deadline. Is the deduction disallowed for 2012 even if the check was eventually made good?

See link for topic posted in March 2011. Am I misinterpreting the earlier response? http://benefitslink.com/boards/index.php?/topic/48135-statutory-employee/

Is it permitted for a full time life insurance agent who is classified as a statutory employee of the life insurance company that employs him & receives a W2 as a statutory employee consider this as earned income for a SEP plan he wants to establish as a sole-proprietor? My initial response is yes because of the exception for life insurance agents that treats their income as self-employment income. Normally, W2 income is not considered earned income for self-employment.

If a MEP is formed with two employers where there is common ownership between the two companies but not enough to constitute a controlled group, are discrimination testing & top heavy determination performed separately for each employer? I know recent DOL guidance ruled that this type of an arrangement would not be considered an open MEP and, therefore, should be treated as a single plan. Is the DOL referring to filing a single Form 5500 as a multiple employer plan or also testing as a single plan?

Is it required, or even recommended, that when an employer establishes SEP-IRA accounts on behalf of their employees that the title of the accounts be in the name of the employer FBO the employee? Can the name of the account be in the name of the employee identified as a SEP-IRA? Any deductibility consequences if account is not in the name of the employer?

Has there been any guidance on how plan auditors are to address the required fee disclosures scheduled for 7/1/12 & 8/31/12 in their 2011 auditor's report? Would these be considered subsequent events requiring to be included in the auditor's 2011 report?

I understand your suggestions to have the client rollover his defaulted loan balance to an IRA to avoid the taxes & penalty. However, I don't think he has the available funds which would be approximately $25k to rollover. Is it worth filing a claim with the DOL to force the employer not to default on the loan? I believe the loan policy states a cure period of 90 days after last scheduled payment.

We have a client who terminated employment with a hospital & had an outstanding loan through his 403(b) plan. He was permitted to continue making loan payments even after termination. He missed one scheduled payment and was informed that he had until March 1st to make a payment, which was the last day of the cure period, to prevent the loan from being defaulted. He remitted a loan payment in mid Feb but the amount of the check was off by less than $1 from the scheduled payment amount. The trustee refused to accept the payment and the check was returned to the participant prior to the March 1st deadline. The trustee also refused to accept a replacement check which could have been received by the deadline and, therefore, defaulted on the loan. Does our client have any recourse against his former employer claiming that he was treated unfairly & the loan was defaulted prematurely?

I have a new client who informed us that they failed to contribute the mandatory matching contributions on behalf of their employees who participated in a Simple IRA plan. The delinquent contributions cover the years 2003-2010. The client intends to fully correct by depositing the missed matching contributions + earnings and then to file under VCP. Is the client permitted to take a deduction in 2012 for the cumulative missed matching contributions + earnings?

Can anyone confirm if a publicly traded REIT or limited partnership or REIT mutual fund is subject to UBTI if purchased as an investment in a retirement plan?