Posts Tagged "Greg Matthews"


“Carve out” plans have become the latest rage in the design of pension and profit sharing plans targeted to meet specific funding goals of an employer. The design strategy basically limits the employer’s contribution to a select group of employees (the “carved-out” group). The group will generally include a limited number of highly compensated (HC) and nonhighly compensated employees. Such a plan must, among...

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Employers are permitted to revise provisions of their plans through a formal amendment. This year many employers will be revising their plans and possibly a whole series of changes without their knowledge when they restate their plans for the required GUST amendments. What employers can do directly or inadvertently is eliminate a benefit option, unless permitted by the Code. The IRS has just made this process a little less challenging...

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Most plan documents will specify that a rehired former employee who had been a participant in the plan will reenter the plan upon rehire. This generally doesn’t pose a problem for profit sharing and pension plans where the employer’s allocation is made at the end of the plan year. It can cause a problem for 401(k) plans. When a participant is eligible to participate in the plan, either on initial eligibility or in a rehire, the...

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Congress has rolled out its heavy artillery to blast away any possibility for a repeat of the Enron mess. Backed by a heavy media blitz, the proposed legislation is designed to avoid other 401(k) participants, in large and small plans, from being “Enron-ed.” However, this legislation hurts the small employer. We provide a summary of the key proposals as of the date we go to press. On April 11, the House passed H.R. 3762,...

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As of December 2004, the Pension Benefit Guaranty Corp. PBGC had taken over pension plans with liabilities that exceeded assets by $23 billion. Earlier this year United Airlines increased the PBGC’s deficient by an additional $6 billion, and the other airlines are only a breath away from adding even more. Where will the PBGC come up with the all the money to pay retiree benefits? Currently, the only source of revenue available...

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