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401(k)

How to divvy up assets as you head for retirement

How to divvy up assets as you head for retirement

As reported in the LA Times, “How to divvy up assets as you head for retirement.” Choosing how to invest retirement savings often ends up being a dartboard exercise for younger people, because it all seems so theoretical. As the date of retirement or semi-retirement gets nearer, however, you begin to realize that your financial […]

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Proposed Regs would modify nondiscrimination requirements for closed pension plans

Proposed Regs would modify nondiscrimination requirements for closed pension plans

Preamble to Prop Reg1/28/2016; Prop Reg § 1.401(a)(4)-2, Prop Reg § 1.401(a)(4)-3, Prop Reg § 1.401(a)(4)-4, Prop Reg § 1.401(a)(4)-8, Prop Reg § 1.401(a)(4)-9 , Prop Reg § 1.401(a)(4)-12 , Prop Reg § 1.401(a)(4)-13 IRS has issued proposed regs that would modify the nondiscrimination requirements applicable to certain retirement plans that provide additional benefits to […]

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Tax effects of employees being able to contribute unused vacation to 401(k), HRA plans

Tax effects of employees being able to contribute unused vacation to 401(k), HRA plans

PLR 201601012 In a private letter ruling, IRS has determined that provisions in an employer’s 401(k) plan and its retiree medical expense reimbursement plan that allow employee contributions to those plans of the dollar equivalents of the employees’ unused vacation time do not result in the offering of an additional qualified cash or deferred arrangement […]

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10% penalty applied to 401(k) distribution used to prevent employee’s eviction from home

10% penalty applied to 401(k) distribution used to prevent employee’s eviction from home

Kott, TC Summary Opinion 2015-42 The Tax Court has held that a taxpayer who was younger than age 59-1/2 was liable for the 10% early distribution penalty when he withdrew funds from a Code Sec. 401(k) plan because he was delinquent in his mortgage payments and wanted to avoid foreclosure. Background. Code Sec. 72(t) imposes an […]

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IRS cautions plan administrators to document hardship distributions and plan loans

IRS cautions plan administrators to document hardship distributions and plan loans

In the latest edition of its Employee Plans News, IRS cautions plan administrators that they must document and keep necessary records of each employee hardship distribution and plan loan. The result of noncompliance could be a qualification failure for the plan.  Click here for the April 1, 2015 Edition of IRS’s Employee Plans News newsletter. Background on […]

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IRS Notice Provides Mid-Year Amendments to Safe Harbor 401(K) & 401(M) Plans to Reflect Impact of Windsor Case

IRS Notice Provides Mid-Year Amendments to Safe Harbor 401(K) & 401(M) Plans to Reflect Impact of Windsor Case

Notice 2014-37, 2014-23 IRB. In a Notice, IRS has stated that a plan will not fail to satisfy the requirements to be a Code Sec. 401(k) or Code Sec. 401(m) safe harbor plan merely because the plan sponsor adopts a mid-year amendment pursuant to a recent IRS notice that required amendments to plans to reflect […]

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Tax Court rules QDRO distribution to ex-wife was taxable despite ex-husband’s debt to her

Tax Court rules QDRO distribution to ex-wife was taxable despite ex-husband’s debt to her

In Weaver-Adams v. Commissioner, TC Memo 2014-73, the Tax Court has rejected a taxpayer’s argument that amounts she received as a distribution from her ex-husband’s 401(k) plan under a qualified domestic relations order (QDRO) were nontaxable because, as a result of the fact that the ex-husband owed her money, she had basis in her ex-husband’s […]

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Income tax time bar didn’t block excise tax deficiency assessment for same transaction

Income tax time bar didn’t block excise tax deficiency assessment for same transaction

In Mazzei v. Commissioner, TC Memo 2014-55,  the Tax Court has ruled that, where taxpayers engaged in a multi-step transaction that IRS concluded was nothing more than disguised payment of income to the taxpayers, followed by their contributing that income as excess contributions to their IRAs, the fact that the statute of limitations had expired […]

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Sorting out the timing rules for traditional and Roth IRAs – Part II

Sorting out the timing rules for traditional and Roth IRAs – Part II

This blog article sorts out the Roth IRA timing rules for regular contributions, rollovers, trustee-to-trustee transfers, conversions, recharacterizations, and reconversions, and offers practical suggestions on how to keep the complications to a minimum. It’s the second of a two-part series – the first covering timing rules for traditional IRAs. Regular contributions to Roth IRAs. The deadline […]

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Court rejects taxpayer argument that custodian was to blame for late IRA rollover

Court rejects taxpayer argument that custodian was to blame for late IRA rollover

In Alexander, TC Summary Opinion 2014-18, a taxpayer who had received an IRA distribution, used the proceeds for business, and then applied for a “loan” from the IRA custodian to make a rollover – which wasn’t rolled into the IRA until the 66th day after the distribution – was subject to tax and the 10% […]

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IRS describes situations where plan administrator may reasonably find a valid rollover

IRS describes situations where plan administrator may reasonably find a valid rollover

In Revenue Ruling 2014-9, 2014-17 IRB, IRS has provided two fact patterns under which, in the absence of evidence to the contrary, the plan administrator of a receiving plan will be deemed to have reasonably concluded that an amount received was a valid rollover contribution. Thus, for purposes of the receiving plan’s qualification status, the […]

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Young Boomers, Get to Saving – You Can Still Catch Up on Retirement Contributions

Young Boomers, Get to Saving – You Can Still Catch Up on Retirement Contributions

Young Boomers, Get to Saving – You Can Still Catch Up on Retirement Contributions, as reported in the news of the WS Journal. This year marks a major turning point for baby boomers: The youngest of them turn the big 5-0. Meanwhile, Gen-Xers are now solidly in their 40s and even the vanguard of the […]

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Regulations both ease and toughen requirements for suspending 401(k) safe harbor contributions

Regulations both ease and toughen requirements for suspending 401(k) safe harbor contributions

IRS has issued final regulations, T.D. 8641, Reg. § 1.401(k)-3, Reg. § 1.401(m)-3, permitting employers whose 401(k) safe harbor plans provide for nonelective contributions to suspend those contributions under conditions that are easier for employers to meet than those that applied under proposed reliance regs. The final regs also apply these requirements to suspensions of safe […]

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Meet Paul Raymond

Meet Paul Raymond

Mr. Raymond is a sought after speaker in tax controversy law by many attorney, accountant, and business groups and at the request of the Internal Revenue Service, has presented programs at the IRS Nationwide Tax Forum, attended by tax professionals throughout the United States.

Additionally, he continues to be an active member in the Section of Taxation, American Bar Association, where he was the Past Chair of the Employment Taxes Committee.

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Member CA Bar Member Orange County Bar US Tax Court Attorney