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I realize that a 403(B)7 is setup through a custodial account arrangement and there is no Trust vehicle involved. But is there anyway to have a Trustee involved with this type of plan?

My response would be: "I would be happy to do this for you but it is a tedious process and I will charge $125 an hour with a minimum of two hours billing."

I didn't say it would be easy....

I advise my clients to use 50-75%. I would say that it would be okay to use 100% as long as you document that you are interpreting this to mean 100% after other deductions such as FICA, health, etc.

Another thing that you might consider is that keeping track of match vesting pre-2002 and post-2001 is a significant administrative burden. We advise all our clients to to make all match go to the minimum 2/20.

Can someone give me a link to the actual EGTRRA legislative document that was passed? I would greatly appreciate it.

I meant are the assets kept separately for each employer just in case there is any confusion on what I meant. As long as your assets are held together in one trust account and file the amended 5500, I think that should be everything you need to do.

Your assessment is correct. You should have filed only one 5500 with a schedule T for each participating employer. You should file an amended return. Are the assets kept separately for each plan or do you have them comingled?

However, you can use your prototype for the multiple employer document but you would have to remove all of the prototype language and do a little more tweaking. If you have never done it before, I would recommend paying someone else to do it for you. Your prototype vendor will probably do this for you for a fee.

I am not sure about a volume submitter doc but I don't believe you can put a multiple employer plan on a prototype. You would have to use a customized document.

Rainy days and mondays are always getting me down...

Why did you have to put the contribution into the plan? Is it a 401(k)?

Well, I did not know that. You learn something new everyday!

Are you talking about trying to amend a qualified plan into a SIMPLE Plan? If so, that is not possible. The current plan would have to be terminated and everything would be 100% vested. The EEs would have the option of rolling into an IRA.

I would not believe that a merger is possible since one is a qualified plan and the other is an IRA. It also may not be up to the employee to rollover the IRA to the qualified plan. The plan will have to be amended to allow for rollovers from IRAs.

Actually it is a profit sharing plan. That is what I thought but I had a colleague arguing with me and it made me doubt myself.

If a Plan has annuities listed as its only option of distribution, can the plan be amended to change to lump sum as its only form of distribution?

You will still be taxed for any accumulated earnings.

I misread the question. This is not a controlled group. The owners together must own at least 80% of the stock or voting power AND together own 50% to the extent their ownership is the same in regards to each company.

I believe it is IRC 1563(a).

I am using 75% for my plans. I am leaving the other 25% alone in order to deal with payroll taxes and any other deferred comp items such as cafeteria plans. I have yet to see someone defer that much though.

If I understand you correctly, the plan is currently in operation and they now want to make the safe harbor match. In this case they would not be able to implement the SHM until next year and the employer will have to provide a notice to all participants at least 30 days before the next plan year begins.

Then the participant would owe the taxes for 2001 tax year and the employer would not owe the excise tax.

A company has just realized that they left someone out of the census for the 2000 plan year thus that participant did not receive a contribution for 2000. The contribution was just recently made for this participant. Besides filing an amended 5500 are there any other steps that need to be taken to correct this?

mb, that is true but the original post did not address this. I was under the assumption that this was not an issue. If ADP is an issue than yes, you would need to wait. MarZ, accountants will make the compensation whatever it needs to be in order to reduce income tax. This is what we refer to as "cooking the books". If the ADP is an issue for you then it would be best to wait until comp figures have been computed.