rollover IRA in 401k plan

[Guest Brenda Schachle]

First Question: If a plan allows rollovers and an employee rolls into the plan assets formerly in a deductible IRA, this would be considered just a plain old rollover -- not a "deemed IRA" -- correct? My understanding is that owner-trustees must have a custodian to hold a "deemed IRA" but that has not been the case for rollovers. Do rollovers from IRA's need to be looked at differently than other non-related rollovers from qualified plans?

Second Question: Employees who are not 5% owners may be exempted from the RMD rules under qualified plans. What if that individual rolls his deductible IRA's into the plan -- are they now also exempt from the RMD rules until the individual retires?

[stevena]

My take...EE may defer the minimums on the IRA rollover account in the plan because he has recharacterized that account when he rolled it into the plan.

This is a "regular" rollover, not a deemed IRA