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John T. Cheek, CPA
Upstate NY Rochester, Buffalo, Syracuse:
1421 Quarry Rd. Caledonia, NY 14423 585-226-2621 or fax to 585-226-8259
Audit/Consulting Services: a message from the sponsor. ("I want your audit")
LM-30: Memo, forms and instructions
Where's My Refund? The IRS has $80 million in lost refunds
Church Tax Guide- download pdf
Employee Benefits News
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Cheek's Client Update on ERISA Plans :
May '04: Upcoming seminars, Enron lessons, EFAST-2?
DOL Reporting and Disclosure Guide for Employee Benefit Plans: (this is my last copy, but you can have it) (dowload pdf)
Model COBRA Notice, Model Election Form (.doc format)
Gene Parrs, Esq: Mistakes with IRA Beneficiary Designations (and a whole lot more)
Form 5500 Filing Tips- advice from the IRS
Health Coverage Tax Credit. The HCTC pays 65% of your qualified health plan premiums for as long as you remain eligible. In general, you may claim this credit if: a)You are receiving certain Trade Adjustment Assistance (TAA) benefits, b) You are receiving benefits under the Alternative Trade Adjustment Assistance (ATAA) program, or c) You are receiving benefits from the Pension Benefit Guaranty Corporation (PBGC) and you are at least 55 years old. In addition,you must be enrolled in a qualified health plan. If you want more info, download the guide (in pdf)
Find an NAIC code for NYS HMOs
ERISA Road Show - John Cheek blankets the country with more than 20 road trips presenting "Audits of Employee Benefit Plans- Level I and II" and "Preparing Form 5500."
HIPAA Files: From ABAnet, Implications for Employers (pdf)
TSB-A-02(9): NYS decides if a VEBA receving demutualization proceeds is conducting an unrelated business subject to UBT in NYS.
10/06/02
PBGC Tech Update 02-2: If the JCWAA Relief spared your plan from underfunding and the PBGC Variable Rate Premium, it didn't necessarily spare you from giving participants notice of underfunding. That's because the JCWAA's higher interest rate for computing underfunding does not apply for Participant Notices.
Court Rejects Lower DisclosureThreshold for Multiemployer Plans When Benefit Improvements are Under Consideration (pdf file)
Form 5500 Troubleshooter's Guide: download part 1 or part 2
Military Service counts: FMLA warning
"Corporate Responsibility": Sarbanes-Oxley Act full text
HIPAA Privacy Rule has consultants scrambling to bring plans into compliance, or submit plans to do so, by Oct 16, 2002 deadline. Small plans have an extra year. See "top 10" HIPAA facts from the Washington Business Journal.
IRS Employee Plans News:
Fall 03 Missed the deadline?
July 03 Flurry of Regulations
June 03 EPCRS Recap, links to Rev Ruls.April-June, DOL update
Nov 2002 Special Edition: extends deadlines for prototype plans to adopt GUST amendments, FAQs on MRDs, PWBA and IRS looking for delinquent filers.
download Fall '02 Edition (pdf) Interview with Paul Shultz, GUST reminder, EPCRS update.
download Summer '02 Edition (pdf). 16 page newsletter addresses MRD's; Listing of Required Modifications (LRMs) for SEPs, SARSEPs, SIMPLEs, and IRAs; procedures for GUST late-amenders.
NYC Firefighter's Death Benefit - partially includible, partially excludible, for estate tax purposes.
Schedule F (Form 5500) is eliminated. Effective immediately, the IRS says Schedule F is no longer necessary for fringe benefit plans. Cafeteria plans (IRC 125), Education Assistance Programs (IRC 127), and Adoption Assistance Programs (IRC 137) will no longer have to file Form 5500 and Schedule F under the IRC. However, if these plans are part of an employee benefit plan under ERISA, the ERISA reporting requirement still stands: if the plan has over 100 participants or is funded, a 5500 is still needed. My guess is that many employers who sponsor cafeteria plans never even considered whether the plans were also welfare plans, and they could be in for an unpleasant surprise when the issue eventually surfaces. (See DFVC Program, below.)
JCWAA- Job Creation and Worker Assistance Act of 2002: signed into law 3/9/02, includes benefit provisions, economic stimulus, NY Liberty Zone provisions. Download PDF
Delinquent Filer Program- new and improved! On 02/06/02, I told you that the DOL may be revising the DFVC program to substantially reduce the sanction amount; I suggested that anyone considering a DFVC filing should look into this. The official word is now out, and the improvements are impressive. There's also improvements (not so impressive) to the Vountary Fiduciary Correction Program.
Minor Changes on 2001 Form 5500
IRS Announces Relief to Those Affected by Terrorist Attack
DOL Adopts Rule Requiring Audits for Small (under 100) Plans Almost all plans can avoid the requirement. (10/21/00)
IRS Releases 2001 Pension Limits
PBGC Early Warning System; PBGC has the authority to terminate your plan if you threaten PBGC with an "unreasonable risk of loss." In Tech. 00-3, PBGC explains its early warning system, and actions it might take to minimize risk. Key risk indicators: poor corporate bond ratings, an underfunded plan, and a pending "reorganization-type" transaction. 7/24/00
Is your Plan "Almost Governmental?: If so, it might not be subject to the reporting and fiduciary rules of Title I of ERISA.
The New 5500 and the EFAST filing program: DOL's Q&As
DOL Voluntary Cleanup Program for Fiduciary Breaches-- Confession may be good for the soul, but who wants to bring the DOL into it?
Form M-1: MEWAs, and Some CBA based Welfare plans, are subject to a new annual filing requirement on Form M-1, with the first report due May 1, 2000.
Excess Benefits Tax: Proposed Regulations Signal New IRS Scrutiny for Tax-Exempts (9/11/98)
IRS Repair Manual for Qualified Plans: Consolidated program for correcting plans' mistakes (Updated 8/24/01)
NYS "UBT" Refund Opportunity: NYS won't tax a pension's unrelated business income! (12/20/97)
DOL Rips CPAs on Poor Performance "Too many accountants are not trained for ERISA audits, but guess who the DOL will penalize."
DOL Nonenforcement of SOP 96-6 Multiemployer plans, only, got a temporary waiver on complying with GAAP. DOL began "enforcing" SOP 92-6 with annual reports filed for years beginning 1/1/2000. Any Form 5500 whose accountant's report is modified due to noncompliance with SOP 92-6 risks rejection by DOL If you need help adopting SOP 92-6, I can help; I've designed software to project postretirement benefits with a minimum number of data elements and, therefore, less cost and less disruption.
Archives
Speeches, Articles from my Newsletter, Client Alerts, etc., with supplemental info that wouldn't fit in the printed versions, and updated with new info where indicated.
IRS Regulations on Plan Loans to Participants Defaulted Loans are still owed, and interest keeps accruing, even after a defaulted loan triggers a 1099! (Updated 1/13/98)
DOL Makes Fiduciaries Financially Responsible for Selecting Safest Annuity Provider
Derivatives- What You Don't Know Can Hurt You
What DOL is Watching Now! .... Issues Arising in Field Audits
Plan Audits- outline of speeches by John Cheek covering :
MEWAs and VEBAs Marketing -notes from Nov 97 meeting of Benefits Committee (Update 3/00: MEWAs and certain collectively bargained plans must file new MEWA report on Form M-1.)
Taxpayer Bill of Rights: You Have the Right to be Penalized!
Top 10 Mistakes by Non-Profit Organizations
Independence according to DOL: ERISA Plans: Your Plan Auditor MUST be "independent" or the audit attached to the 5500 could be rejected. And DOL defines independence more strictly than your accountant does. Performing bookkeeping for the plan, or posting the plan's investment activity, could impair your CPA's independence.
IRS Threat to Union Building Corps (and other taxable subsidiaries) Update:January 1999- final regs are issued, you can no longer change to tax-exempt status without triggering "taxable sale" treatment.
Prohibited Transactions: the IRS Examination Guide for Multiemployer Benefit Plans
Consideration of Pension Fraud- Highlights of FAE Conference
Volunteer Firefighters: Service Awards Program Spared Tax Bite until Retirement
Trustees and Administrators Forum
Guest Articles of interest to Trustees and Administrators, including:
Eugene Paars' Pension memo
Crime & Punishment, New Style IRS (Alvin Lurie) (7/2/98)
The Case for Using a Professional Trustee (Herbert R. Ricklin)
Can IRS Levy Against Your Participant's Account?
401(k) Loan: Do you have to pay it back?
...and more...
QDRO Corner : What can an Administrator do if he suspects a "DRO" was obtained by fraud? (10/26/99)
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Where to go for more info:
Participants' rights and basic plan provisions
www Sites for Employee Benefits Issues
PWBA Regional Offices : Telephone numbers, addresses, jurisdictions... updated 9/25/01 for WTC Attack.
IRS Walk-in Hours: summer hours and locations for upstate NY IRS offices, if you have a personal tax problem and want to talk to a human being face-to-face.
SitePlans: See What Other Benefit Plans are Doing on the Web
To add a link to your site, email to: cheek @cpaspan.com
And Now, for something completely different..
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After Hours ....... it's not all debits and credits.
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