I've got a couple questions...

1) are required quarterly contributions due for all plans that are less than 100% funded? or
2) is it just for underfunded plans with souls over 100 or is it 500?

Thank you,

Andrew

Even for "soul" proprietors

Follow up question (and I apologize if they are very basic, i'm still learning),

1) do all contributions have to be discounted back using the effective rate to the valuation date or the the beginning of the year?

2) is the interest deductible or just the rmc?

Simple Ex.

Rmc at 1/1/2008 is 100
all quarterly contributions of 25k are made and on 9/15 an additional contribution of 4200 is made.
is the client able to claim 104,200?

3) Isn't there an interest penalty for not making the required quarterly contributions?

Thank you

Since the balances will actually be updated using the trust fund yield, you can't take everything out to the end of the year as if it was still 2007. So, 1) should be yes, using the effective interest rate.

Since you also have the deduction rules for under 100% FT, and quarterlys are only needed for underfunded plans, the answer to 2) should be yes in all but the most bizarre situations.

3) says the discount rate on those late contributions is effective rate plus 5%.

A nose count of 100 triggers the "liquidity" contribution, a different animal than the "quarterly" contribution, although from the same genus/genius.

An additional question:

The new discount rules for contributions do not apply until 2009 plan years. Therefore, 2008 contributions are not discounted.

Given that there is no discount - what happens to the client who misses the quarterly date in 2008. The regulations permit you do use the new quarterly penalty rules but what happens if you don't?? No quarterly penalty at all for 2008???