401K Advisor articles from June 2004

401K Advisor archives from June 2004

If you forgot what terror was like ... it's back.(401(k) plans)
June 1, 2004... No, it's not JAWS, it's LAWS... That is, it is Congress' latest attempt at reforming the world through poorly thought out tax legislation. The latest attempt by Congress at social engineering is to create a new set of rules and restrictions...

Many issues to consider when 401(k) plans merge.
June 1, 2004... Merging one or more 401(k) plans into another 401(k) plan is common when companies restructure or are involved in an acquisition. Most employers decide to merge 401(k) plans because maintaining more than one 401(k) plan is costly and...

ERISA [section] 404(c): allowing 401(k) participants to direct the investment of their own accounts.(Employee Retirement Income Security Act of 1974)
June 1, 2004... The Department of Labor's regulations under [section] 404(c) of ERISA are itended to establish the rules that apply to 401(k) plans (as well as other defined contribution plans) that permit participant directed investment of their account...

Employers that include their own stock in the company's 401(k) plan assume fiduciary responsibilities as well as legal risks.
June 1, 2004... A decision by a US district court, refusing to dismiss a lawsuit that alleged that the officers and directors of Kmart Corp. had breached their fiduciary duties when they chose to retain Kmart stock as an investment option in the company's...

IRS allows government to garnish 401(k) plan assets to satisfy fine.(Internal Revenue Service )
June 1, 2004... The Internal Revenue Service (IRS) as issued a private letter ruling holding that a 401(k) plan would not be disqualified if it honored a garnishment order to collect a federal criminal fine from a participant's 401(k) account. The...

Former employees may be charged with a plan's administrative expenses.
June 1, 2004... The IRS recently ruled that a defined contribution plan may charge a pro rata share of the plan's reasonable administrative expenses to the accounts of former employees, even though the employer pays the expenses allocable to the accounts of...

IRS final loan regulations clarifies the suspension of participant loan repayments for military reservists called to active duty.
June 1, 2004... Many 401(k) plans permit participants to borrow against their account balances. The loan roles generally in effect, however, may be subject to modification for participants upon their return to service after a leave of absence due to military...

Understanding the multiple definitions of the term "safe harbor" as referenced throughout the internal revenue code with respect to tax-qualified retirement plans.
June 1, 2004... Throughout our years of service to plan sponsors of tax-qualified retirement plans, we noticed that confusion is often created when the term "safe harbor" is used during discussions with our clients in relation to the administration of such...

Year end checklist.(Directory)
June 1, 2004... For December 31 plan year-end * Minimum Required Distributions --Distribution must occur prior to December 31 for the following employees: * Terminated employee over age 70 1/2 with an account balance, or * 5 percent owner...