Catalist Wealth

Health care reform provision at-a-glance Long-Term Care

admin — Sun, 24 Oct 2010 04:18:41 +0000

Under the Patient Protection and Affordable Care Act (or health care reform law), the secretary of Health and Human Services will establish a voluntary long-term care (LTC) insurance program called Community Living Assistance Services and Supports (CLASS) by January 1, 2011. The program will offer the CLASS Independence Benefit Plan, but the new law does not specify a date for enrollment. This is a government program.

What the provision does

The long-term care provision of health care reform law is designed to help individuals and families pay for long-term care. Fewer than 10% of older Americans currently have private LTC coverage. The CLASS program attempts to address gaps in coverage by offering a long-term care insurance plan. However, it offers limited benefits.

Who can enroll

Employers will need to decide if they will offer the CLASS program to employees. If an employer chooses to participate, employees age 18 and older must be automatically enrolled in the program, regardless of their pre-existing conditions. Employees can choose to “opt-out” if they don’t want to participate. CLASS is also available to individuals who are self-employed, have more than one employer or have an employer who chooses not to participate.

How the premiums will be determined

Premiums will be established by the U.S. Department of Health and Human Services secretary and will be based on age and not health risk. Based on the information available, we believe premium subsidies will be available for workers with incomes below the federal poverty level and full-time students age 18 to 21 who work.

How to qualify for benefits

After paying premiums for five years, enrollees will be eligible to receive benefits.

CLASS will be administered by the U.S. Department of Health and Human Services.

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This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

Insurance Solutions for Breast Cancer Survivors

admin — Thu, 21 Oct 2010 15:53:57 +0000

Catalist Financial has partnered with one of our Top Carriers to let the community know about some very important Insurance S0lutions for Breast Cancer Survivors. Finding protection for your family should be the least of your challenges.

For more than 45 years, we’ve been providing protection for breast cancer survivors — and those who love them Massachusetts Mutual Life Insurance Company (MassMutual) has been proudly providing insurance coverage for breast cancer survivors since 1964. Today, thanks to the continuous evaluation of our underwriting guidelines, we believe more survivors than ever are qualifying for coverage with shorter waiting periods and lower premiums.

We work to ensure that the benefits of the most up-to-date diagnostic and treatment advancements are considered. As you take the next step in your journey, you can be assured that MassMutual will help you explore your various coverage options.
To learn more, contact a MassMutual financial professional at 317-441-4321

MassMutual’s insurance coverage can help provide the following “living benefits” for you and your family:
• Whole life insurance products (as long as the policy is in force) offer a guaranteed, cash value accumulation, which is tax-deferred and can be borrowed for any purpose. With supplemental retirement income, educational funding and a source of funds for emergencies, these products can offer comfort for you during your lifetime.1

• Term life insurance products offer death benefit coverage for a specified time frame and can provide policy owners with the ability to convert the policy during the conversion period to a permanent MassMutual policy, regardless of changes in the insured’s health.

• Disability income insurance benefits can help pay your mortgage or rent, medical bills and other expenses, if you are too sick and cannot work. A lengthy, chronic healthcare issue can affect so many parts of your life: from placing caregiving burdens on your family and potential asset depletion, to fulfilling your desire to live independently. A MassMutual professional will work with you and those closest to you to develop a strategy to address these concerns.

Protecting your family over the long term
Usual Medical Underwriting Requirements:
• Abbreviated medical examination (breast and gynecologic exams not required)
• Blood and urine studies
• Records from your physicians, to include:
• Pathology and surgery reports
• Records of any other treatment
• Follow-up visits and mammograms

For those currently in good health with no evidence of recurrent cancer, MassMutual uses the following general guidelines:

The above is a summary of MassMutual’s general underwriting guidelines. Because each person’s medical situation is unique, actual offers may vary depending on the specific factors involved.

Facing breast cancer is enough of a challenge without having to worry about how your family will be protected if something happens to you. At this time, there are about 2.5 million breast cancer survivors in the United States. Thanks to early detection and improved treatment options, that number is rising every day and more women are surviving breast cancer than ever before.*

You deserve a team of professionals who understand the challenges you face, and can provide options to help you make good decisions for yourself and for your family.

Take care of yourself, and protect those who love you, too.

Insurance products issued by Massachusetts Mutual Life Insurance Company, Springfield, MA 01111-0001. Some products and riders may not be available for sale in all states, and may have exclusions and limitations. For costs and complete details of coverage call your agent or MassMutual at 317-441-4321 for your local agent.

© 2009 Massachusetts Mutual Life Insurance Company, Springfield, MA.
All rights reserved. www.massmutual.com. MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives.

* Source: American Cancer Society, Detailed guide: Breast Cancer www.cancer.org, updated May 2009

1 Distributions under a policy (including cash dividends, withdrawals and partial/full surrenders) are not subject to taxation up to the amount paid into the policy (the cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10% tax penalty.

Access to cash values through borrowing, withdrawals or partial surrenders can reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.
WMI1292 909
CRN201109-124568

151 (A) VACATED !!!

admin — Fri, 16 Jul 2010 04:05:14 +0000

Good News: 151(A) Vacated! :: This means the courts have told the SEC that the SEC’s Rule 151(A) is no longer valid. If the SEC wants to revive the Rule, it must start over from square one.

TEXT OF DOCUMENT COPIED BELOW

======================================================

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

____________

No. 09-1021

September Term 2009

SEC-74FR3138

Filed On: July 12, 2010

American Equity Investment Life Insurance

Company, et al.,

Petitioners

Securities and Exchange Commission,

Respondent

——————————

Consolidated with 09-1056

BEFORE: Sentelle, Chief Judge, and Ginsburg and Rogers, Circuit Judges

O R D E R

Upon consideration of the petition of Old Mutual Financial Life Insurance Company for rehearing and the response thereto, and the supplemental briefs of the parties, it is ORDERED that the petition for rehearing be granted to the extent that Rule 151A be vacated, and the opinion in American Equity v. SEC, 572 F.3d 923 (D.C. Cir. 2009), be amended to delete the last sentence in the first paragraph, 572 F.3d at 925, and insert in lieu thereof “Accordingly, we vacate the rule.” and to delete the third full paragraph, 572 F.3d at 936, and insert in lieu thereof:

Having determined that the SEC’s § 2(b) analysis is lacking, we grant the petitions insofar as they assert the SEC failed properly to consider the effect of the rule upon efficiency, competition, and capital formation. Turning to the appropriate remedy, under Allied-Signal, Inc. v. United

States Nuclear Regulatory Commission, we note “[t]he decision whether to vacate depends on the seriousness of the order’s deficiencies (and thus the extent of doubt whether the agency chose correctly) and the disruptive consequences of an interim change that may itself be

changed.” 988 F.2d 146, 151 (D.C. Cir. 1993). The SEC O R D E R Upon consideration of the petition of Old Mutual Financial Life InsuranceCompany for rehearing and the response thereto, and the supplemental briefs of theparties, it is ORDERED that the petition for rehearing be granted to the extent that Rule 151Abe vacated, and the opinion in American Equity v. SEC, 572 F.3d 923 (D.C. Cir. 2009),be amended to delete the last sentence in the first paragraph, 572 F.3d at 925, andinsert in lieu thereof “Accordingly, we vacate the rule.” and to delete the third fullparagraph, 572 F.3d at 936, and insert in lieu thereof: Having determined that the SEC’s § 2(b) analysis islacking, we grant the petitions insofar as they assert the SECfailed properly to consider the effect of the rule uponefficiency, competition, and capital formation. Turning to theappropriate remedy, under Allied-Signal, Inc. v. UnitedStates Nuclear Regulatory Commission, we note “[t]hedecision whether to vacate depends on the seriousness ofthe order’s deficiencies (and thus the extent of doubtwhether the agency chose correctly) and the disruptive consequences of an interim change that may itself bechanged.” 988 F.2d 146, 151 (D.C. Cir. 1993). The SEC argues it is likely to reissue Rule 151A but it also acknowledges it is in the midst of analyzing the effect of the rule upon the law of each state. As the petitioners point out

the Commission cannot know whether that analysis will support reissuing Rule 151A until it has been completed.

Neither will vacatur be disruptive of the agency’s regulatory program. By its own terms, Rule 151A has not yet gone into effect, cf. Allied-Signal, 988 F.2d at 151 (vacatur would require agency to return fees already collected under regulatory regime); Sugar Cane Growers Co-op of Florida v.

Veneman, 289 F.3d 89, 97 (D.C. Cir. 2002) (vacatur would be “an invitation to chaos” because “[t]he egg has been scrambled and there is no apparent way to restore the status quo ante”), and until such time as it does, the regulations supplied by state law will remain in place, cf. Davis County Solid Waste Mgmt. v. EPA, 108 F.3d 1454, 1458–59 (D.C. Cir.1997) (vacatur would leave certain pollutants partially unregulated for eighteen months). We therefore order that Rule 151A be vacated.

The Clerk is directed to amend the judgment filed July 21, 2009, accordingly.

The Clerk is further directed to issue the mandate 7 days after the issuance of this order.

Per Curiam

FOR THE COURT:

Mark J. Langer, Clerk

BY: /s/

Michael C. McGrail

Deputy Clerk

Prudence Philosophy with Wisdom, Understanding, & Stewardship

admin — Thu, 20 May 2010 02:45:40 +0000

NOTE: This note is Excerpted in part from some of the talking points of a Seminar initially created and given in 2005 to Church groups on the importance of PRUDENT planning given the impending problems with our economy, predicting the market would crash in 2008 bigger than the great depression. As I look back on the wisdom, insight, and knowlege that God gave me at that time, I wish I would have been more vocal and helped more people. Enjoy this NOTE – Ben McCann | CATALIST www.catalistfinancial.com

These four words are intertwined throughout scripture, especially in the book of Proverbs. Did you know that the Bible talks about Money Matters more than any other subject? 3x more than Love, 7x more than Prayer, 8x more than Faith, more than Heaven & Hell combined, more than 2400 Verses…

INTRO:
“The prudent see danger and take refuge, but the simple keep going and suffer for it.”
-Proverbs 27:12

stew•ard n. 1.One who manages another’s property, finances, or other affairs. 2: a complete lifestyle, a life of total accountability and responsibility acknowledging God as Creator and Owner of all.

Once one chooses to become a disciple of Jesus Christ, stewardship is not an option.” - Unknown

Biblical Reference: (Mathew 25:14-30) Parable of the Talents… God takes stewardship Seriously!!! In (Proverbs) there are countless scriptures that Deal with Money, Foolishness, Work Ethic, Laziness, Wealth & Prosperity, Diligence & Faithfullness.

TOO BAD OUR CULTURE AND OUR GOVERNMENT HAVE BEEN IGNORING THEM….WE ELECT OFFIFICIALS AND LEADERS AND EXPECT THEM TO BE GOOD STEWARDS… BUT THEY DON”T EVEN KNOW WHAT THAT MEANS.

Wisdom: wis•dom n. 1: The ability to discern or judge what is true, right, or lasting. 2: A wise outlook, plan, or course of action. 3: the trait or ability to utilize knowledge and experience with understanding, common sense and insight 4: the quality of being prudent and sensible

Biblical Reference:
(PR 21:20) 20 The wise have wealth and luxury, but fools spend whatever they get. – NLT

(PR 14:8) 8 The wisdom of the prudent is to understand his way: but the folly of fools is deceit.—KJV

Prudence: pru•dence n. 1: Careful management to economy. 3: attentiveness to possible hazard, caution to danger or risk. 5: discretion in practical affairs 6: knowing how to avoid embarrassment or distress
Synonyms: prudence, discretion, foresight, forethought,
These nouns refer to the exercise of good judgment, common sense, and even caution, especially in the conduct of practical matters. Prudence is the most comprehensive: Discretion suggests wise self-restraint, as in resisting a rash impulse Foresight implies the ability to foresee and make provision for what may happen: Forethought suggests advance consideration of future eventualities

Biblical Reference:
(PR 27:12) 12“The prudent see danger and take refuge, but the simple keep going and suffer for it.” — NKJV
(PR 14:15) 15 Only simpletons believe everything they are told! The prudent carefully consider their steps.-NLT
(PR 14:8) 8 The wisdom of the prudent is to understand his way: but the folly of fools is deceit.—KJV

Understanding: un•der•stand•ing v. tr.
1: To perceive and comprehend the nature and significance of.
2. To know thoroughly by close contact or long experience with
3. To have understanding, knowledge, or comprehension.
4. Characterized by or having comprehension, good sense, or discernment.

Biblical Reference:
(PR 23:23) 23 Buy truth, and do not sell it, Get wisdom & instruction and understanding. –NASB
(PR 3:4-6,9-10) -4 So shalt thou find favour and good understanding in the sight of God and man. 5 Trust in the LORD with all thine heart; and lean not unto thine own understanding. 6 In all thy ways acknowledge him, and he shall direct thy paths …9 Honour the LORD with thy substance, and with the firstfruits of all thine increase: 10 So shall thy barns be filled with plenty, and thy presses shall burst out with new wine. — KJV

“If a person gets his attitude toward money straight, it will help straighten out almost every other area in his life.”
-Billy Graham

Annuit Coeptis - "May God have favor on our undertaking" - In reference to the All seeing Eye of God overlooking the structures of Man... Unfortunately, MAN doesn't seek GOD first before undertaking projects or dealing with money, MAN says, "I WILL do ____ , and God please Bless it" Instead of "God, what will you have me do, so that I am walking in your will and it will be Blessed"

Making Money Is American.

we put "IN GOD WE TRUST" on our money, but most times it is MONEY that is the god we trust.

American’s Attitude towards MONEY is pitiful: we put “IN GOD WE TRUST” on our MONEY, but Money IS the god we trust.

How Important is This?
62% of all seniors retire at or under $10,000 a year income.
50% retire at or below the poverty level
55% of people worry about money “always”
80% of divorced couples report money as the #1 problem leading to divorce

What are the Biggest Problems People Face Today?
1. Longevity
2. Aging Baby Boomer Population
3. Long Term Care
4. Healthcare
5. Market Downturns

ELDER KENIEVAL does not look to positive about his lack of PLANNING for retirement, given the impending RETIREMENT GRAND CANYON JUST LISTED is IN FRONT OF HIM!!

. LONGEVITY: Longevity is the number one risk facing retirees today.
Unfortunately, most people don’t even realize it… It Is A Real Danger.
Social Security is in trouble Pension Plans are draining companies financially.

– Current Average Life Expectancy in the U.S. has risen to 84-male and 87-female. A 65 yr. old has a 25% chance of living to age 94 or beyond
– Many people are living longer in retirement than they live working, this issue is the number one factor that affects everything else. People are simply Living Longer than ever before…

2. Aging Baby Boomer Population
– Approx. 78 million people will begin moving into the Social Security system, beginning in 2008.
Just 3 yrs. from now!
“…Social Security and Medicare face long-term financing gaps that could fuel huge budget deficits and stop the economy in it’s tracks…”-Alan Greenspan
Those 78 million will be forced by the IRS to begin taking RMDs when they turn 70 ½. This applies to those with 401K’s or IRA’s.

*NOTE: I GAVE THIS SEMINAR IN 2005

1986 Erissa Laws changed from Defined Benefit to Defined Contribution.
401K : Many People not saving enough

What is an RMD ?
– Required Minimum Distribution (RMD)
– Account Value ÷ Life Expectancy = RMD

Problem:

More Taxes + Higher Tax Rate + SS Tax = UGLY

Many people take RMD + 30% and find that their account depleted by their mid 80’s, this assumes a 5% return many are invested in Stocks and Mutual Funds. A market downturn can make it run out even sooner.

*HELLOOOOO : RECENT ISSUES ARE PROOF I WAS RIGHT

3. LONG TERM CARE:
– 43% of all people over the age of 65 will need care at some point in their lifetime.
– The avg. length of a stay in a nursing facility is 2-1/2 yrs.
– 83% of all people who go into a nursing facility end up at poverty level within
one year.
– This affects virtually every senior in America, yet few have done anything about it

4. HEALTHCARE: Assumption: People can retire comfortably on 70% to 80% of your pre-retirement income.

Reality: Sky-rocketing health care cost means you’ll probably need 100% of your current income. “Out of pocket” expenses are topping $11,000 a year. Large companies are expected to reduce health care benefits by as much as -40%.
Health care costs are rising 14% annually. They need to have saved $163,000 using a 5% medical inflation rate to $702,000 using the current 14% rate (just for medical expenses alone)… … This doesn’t even take into account Long Term Care…

5. MARKET DOWNTURNS:
– Market downturns at the beginning of retirement (65 – 75) can significantly reduce how long a retiree’s nest egg will last.
– This fact gets ignored when retirees estimate how long their money will last using an average rate of return.
– Most people do not first consider the recovery of their principal before investing in vehicles that put their assets at risk.

When does -30+43=0 ?

$100,000 – 30% = $70,000

$70,000 + 30% = $91,000

$70,000 + 42.8572% = $100,000

A 30% downturn at the beginning of retirement requires a 42.8572% return to recover. The average mutual fund return is 4.5% per year over time. There are more funds than companies to invest in. It would take 10 years without another negative market of average returns just to get back to where you started if you suffered this kind of loss… each loss is even tougher to recover.

A 30% downturn at the beginning of retirement requires a 42.8572% return to recover.
Two-Thirds of Brokerage Firms Continued to Recommend Failing Companies
Among the 30 brokerage firms that covered companies filing for bankruptcy between September 1 and December 31, 2002, 66% continued to recommend that investors buy or hold companies right up until the day that company filed for Chapter 11.

What’s Wrong with Mutual Funds? Most people don’t even know what they have invested their money in, let alone have any control over their own money. He says that it comprised of“GOOD PEOPLE IN A BAD SYSTEM.”
– Arthur Levitt ( Former SEC Chairman for 17yrs and 17yr Wall Street Broker and Author of ” Take On the Street: What Wall Street and Corporate America Don’t Want You to Know. What You Can Do to Fight Back.”

2/3rds of all Brokerage Firms continued to recommend and even sell stocks of failing companies, even up to the day they filed for Bankruptcy… A problem that WALL STREET has is that 1. if your Broker knows that a company has problems and he tells you to move money – it’s called insider trading – U and He goes to Jail 2. If he doesn’t know what is going on inside the company, and they fail… you still LOSE … Still wanna play thatInvesting without Education IS gambling!

The THEE Legged stool of RETIREMENT, (Pensions are GONE, 401(k)’s are losing value, and Social Security has no security and is already broke)… So how will you plan for and fund your RETIREMENT? .. go ahead an INSERT YOUR LIFE SAVINGS FACE UP… and PULL THE LEVER.

Warren Buffet: didn’t buy 1 stock in the stock market from 1992-2002 He Said “…stocks were too expensive”
Worlds Greatest investor Couldn’t find anything to invest in, yet millions of first-time investors and their advisors did. Nov. -11 ‘02 Fortune

“The prudent see danger and take refuge, but the simple keep going and suffer for it.”
-Proverbs 27:12

“Listen to counsel and receive instruction, That you may be wise in your latter days.”
- Proverbs 19:20

WHAT CAN YOU DO? DEFENSIVE ASSET PLANNING.

– People need to make certain they don’t run out of money in retirement, even more important than investment planning.
– Trillions have been lost in retirement dollars in the bear market. Meanwhile, Wall Street says, “Ride it out, stay focused long term, the market will come back.”
– Some do not have the time to wait for the stock market to climb back…whenever that might be.

What Should YOU Do? PUT GOD FIRST… Then seek to Understand HIS ways concerning money, Be Prudent, Sensible, Understanding, Be a Good Steward.
You need an investment strategy that encompasses three main goals:
1. Protect retirement savings.
2. A contractually guaranteed level of income, regardless of lifespan.
3. Make certain they don’t run out of money while in retirement.

What Does a Doctor Do When You Go To The Emergency Room?
Stabilizes The Bleeding (the losses).
That’s What You should Do Financially.

Most Financial Plans Are Not Designed Against Loss.
Most are not constructed so that people never run out of money in retirement.
Most plan designs do not consider the effects of income taxation.
Most people are not absolutely certain of these things, they need to be educated.

“The prudent see danger and take refuge, but the simple keep going and suffer for it.”
-Proverbs 27:12

“Listen to counsel and receive instruction, That you may be wise in your latter days.”
- Proverbs 19:20

WHAT CAN YOU DO? DEFENSIVE ASSET PLANNING.

www.catalistfinancial.com

FAILING to PLAN your Retirement is PLANNING to FAIL in Retirement

If you are WISE, PRUDENT, and UNDERSTAND what you are doing, you are exercising GOOD STEWARDSHIP and will MAKE IT OVER THE GRAND CANYON of RETIREMENT. WOOooooo HOOOooooo!!!!

Which ROAD will you take : WISDOM or Foolishness.

Bottom Line:

Matthew 6:33 (King James Version)
“But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.”

There is a LOT to worry about, and to be concerned about, but if YOU seek God first and not things, if you put your TRUST in Him instead of Money, and if you are a faithful steward over what you have been given, then he will bless you, protect you, keep you safe.

Matthew 6:1-4 – Giving to the Needy

1″Be careful not to do your ‘acts of righteousness’ before men, to be seen by them. If you do, you will have no reward from your Father in heaven.
2″So when you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by men. I tell you the truth, they have received their reward in full. 3But when you give to the needy, do not let your left hand know what your right hand is doing, 4so that your giving may be in secret. Then your Father, who sees what is done in secret, will reward you.

Mathew 6:19-34 – Treasures in Heaven

19″Do not store up for yourselves treasures on earth, where moth and rust destroy, and where thieves break in and steal. 20But store up for yourselves treasures in heaven, where moth and rust do not destroy, and where thieves do not break in and steal. 21For where your treasure is, there your heart will be also.
22″The eye is the lamp of the body. If your eyes are good, your whole body will be full of light. 23But if your eyes are bad, your whole body will be full of darkness. If then the light within you is darkness, how great is that darkness!

24″No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve both God and Money.

Do Not Worry

25″Therefore I tell you, do not worry about your life, what you will eat or drink; or about your body, what you will wear. Is not life more important than food, and the body more important than clothes? 26Look at the birds of the air; they do not sow or reap or store away in barns, and yet your heavenly Father feeds them. Are you not much more valuable than they? 27Who of you by worrying can add a single hour to his life[b]?
28″And why do you worry about clothes? See how the lilies of the field grow. They do not labor or spin. 29Yet I tell you that not even Solomon in all his splendor was dressed like one of these. 30If that is how God clothes the grass of the field, which is here today and tomorrow is thrown into the fire, will he not much more clothe you, O you of little faith? 31So do not worry, saying, ‘What shall we eat?’ or ‘What shall we drink?’ or ‘What shall we wear?’ 32For the pagans run after all these things, and your heavenly Father knows that you need them. 33 But seek first his kingdom and his righteousness, and all these things will be given to you as well. 34Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own.

FOR MORE BIBLE SCRIPTURES ON MONEY: CHECK THIS OUT: NOTE ON MONEY – CLICK HERE

FOR A PERSPECTIVE IN DEPTH ON THE HEALTHCARE ISSUE AND SOCIAL INSURANCE / WORLD VIEW IMPACT on OUR ECONOMY, CHECK THIS OUT: NOTE ON SOCIAL INSURANCE & OUR ECONMY: CLICK HERE

Planned Giving – Maximize your Legacy

admin — Thu, 20 May 2010 02:41:08 +0000

So, you want to leave a Legacy so that years from now, people will remember you, who you were, what kind of impact you had? Well the CATALIST team of advisors know how to make that happen. Planned Giving and Legacy Giving are all part of a Stewardship Plan that thinks more about the future generations than ones self. No matter what your cause, there are many ways to to do this:

CLICK HERE: for a FREE Strategy Overview Guide for Individuals entitled “Give and you shall recieve” – A Guide to Charitable Giving.

Many People think that only wealthy people leave endowments, but that is simple not the case. By utilizing some very simple tools such as Life Insurance, even young people without a lot of means can make a signficant impact by planning appropriately. We have a dedicated team of professionals that will sit down with you, your donor base, your employees and talk to them about the causes that they are passionate about, and then work within the tools that exist to make a way for everyone to GIVE NOW and GIVE LATER.

DEPOSIT RULES FOR 401K / SIMPLE FUNDS

admin — Thu, 29 Apr 2010 00:44:13 +0000

DEPOSIT RULES FOR 401K / SIMPLE FUNDS

The U.S. Department of Labor (DOL) regulates an employer’s payment of 401K, 403b and SIMPLE-IRA retirement plan employee “elective deferrals” to the plan’s investment custodian.

DO YOU KNOW THE DEADLINE FOR TRANSMITTING RETIREMENT PLAN FUNDS?

401K AND 403b RETIREMENT PLANS

The DOL rule is somewhat gray. It states that:

“An employer is required to deposit your money into your retirement account as soon as the employee assets can be reasonably segregated from employer assets, but no later than 15 business days of the month following the month in which the payroll deduction occurred.”

Based on fact patterns in DOL plan audits and other published commentary, some considerations are as follows:

For plans with fewer than 100 participants, the DOL finalized regulations on January 14, 2010 which establishes a “safe harbor” of 7 business days following the payroll deduction date. Depositing employee 401K and 403b payroll deduction funds will be considered timely if this 7 day “safe harbor” test is met; and

No safe harbor time period exists for plans with 100 or more employee-participants. Commentary does exist that suggests funding the retirement plan by the due date of an employer’s Form 941 tax deposit will be considered timely (which for large employers is the next day after payroll).

PRACTICAL CONCLUSIONS

For employers with fewer than 100 plan participants, consider using the “7 business day” safe harbor to ensure compliance with DOL funding requirements; and

For larger employers, consider paying the employee payroll deductions (“elective deferrals”) no later than your Form 941 payroll tax deposit date.

SIMPLE-IRA PLANS – DEPOSIT RULE IS SIMPLE!

The DOL requires that employee payroll deductions for an employer’s SIMPLE-IRA retirement plan must be remitted by the 30th day following the month in which the “elective deferrals” were withheld from payroll.

WHAT ABOUT EMPLOYER FUNDING?

Employers are not required to transmit employer “matches” and discretionary employer contributions until the due date of the employer’s Federal income tax return, including filing extensions. Many employers do choose to transfer matching plan contributions on a more frequent basis to avoid large annual plan payment amounts.