Headlines about "Ret plans - admin"

Gathered from the web by the editors at BenefitsLink.com.
Milwaukee County Demands Pension Repayments Because of 'Buyback' Errors
"More than 200 Milwaukee County employees and retirees will face delayed retirements or pension repayment demands totaling about $11 million because of errors made in the way the workers were allowed to purchase extra pension credit through a lucrative scheme. County Executive Chris Abele said Wednesday he had authorized the money recovery because some payments violated county ordinances governing the so-called pension buybacks." (Milwaukee Journal Sentinel)

[Guidance Overview] Guide to Key DC Plan Reporting and Disclosure Deadlines
"Do you know that there are more than 30 statements, notices, participant communications, and forms that a 401(k) or other defined contribution plan may be required to distribute or file in a given year? ... [A table] describes the deadlines for distributing required participant and beneficiary disclosures for defined contribution plans, as well as key IRS and DOL reporting deadlines (e.g., Form 5500 deadlines). The table also identifies the party that is typically responsible for each item." (Quarles & Brady LLP)

Does Your ERISA 403(b) Plan Need a Financial Statement Audit?
"Many nonprofits who sponsor ERISA 403(b) plans are not aware that they need an audit, because counting participants involves much more than knowing how many full-time employees the organization has or how many account balances are in the plan. Especially in the case of nonprofit organizations, the universal availability rules and the ability to exclude certain contracts pursuant to DOL Field Assistance Bulletin 2010-1 add a layer of complexity that requires the employer to give careful consideration to the participant count." (Belfint Lyons & Shuman, CPAs)

Don't Make These 401(k) Blunders
"With all of the literature that accompanies retirement plan enrollment, why do retirement savers continue to blow it? [Jacob Hale Russell of Stanford Law School] posits that people are simply overwhelmed by the decisions that they need to make. The policy response has been to use behavior economics to 'nudge' retirement plan participants into making better decisions." (Chicago Tribune; subscription may be required)

Federal Employees Won't Be Able to Escape Their TSP Debt, Even by Leaving Government
"A final rule issued by the Federal Retirement Thrift Investment Board will allow the agency -- starting May 27 -- to require private-sector employers to deduct up to 15 percent of an employee's paycheck to pay back debts owed to the agency. The wage garnishment can continue until the debt is paid back in full." (Government Executive)

Employers Finding More Reasons to De-risk Retirement Plans (PDF)
"[S]ettlement strategies could cause further deterioration of the plan's funded status that might prevent settlements unless additional contributions are made to neutralize the 'math' of funding ratios.... If there is a strong committee view on interest rates, consider adding a dual trigger to the glide path based on interest rate levels to ease into the hedging portfolio over time.... Lump sum cashouts may trigger one-time settlement charges under US GAAP sooner rather than later. A cashout strategy should be structured with this in mind." (Buck Consultants)

Defined Contribution Plan Participants' Activities in 2013 (PDF)
"In 2013, 3.5 percent of DC plan participants took withdrawals, compared with 3.4 percent in 2012.... Only 1.7 percent of DC plan participants took hardship withdrawals during 2013, the same share as in 2012.... In 2013, 2.7 percent of DC plan participants stopped contributing, compared with 2.6 percent during 2012.... In 2013, 10.7 percent of DC plan participants changed the asset allocation of their account balances and 7.4 percent changed the asset allocation of their contributions.... At the end of December 2013, 18.2 percent of DC plan participants had loans outstanding, compared with 18.2 percent at year-end 2012, 18.5 percent at year-end 2011, and 15.3 percent at year-end 2008." (Investment Company Institute [ICI])

Mercer U.S. Pension Buyout Index, March 2014 (PDF)
"During March, as indicated by the Index, the average cost of purchasing annuities from an insurer increased slightly from 108.4% to 108.6% of the accounting liability. The economic cost of maintaining the liability remained level at 108.7% of the balance sheet liability." (Mercer)

[Official Guidance] Treasury/IRS 2013-2014 Priority Guidance Plan, Third Quarter Update (PDF)
46 pages. Excerpt: "The 2013-2014 Priority Guidance Plan contains 324 projects that are priorities for allocation of the resources of our offices during the twelve-month period from July 2013 through June 2014 ... The plan represents projects we intend to work on actively during the plan year and does not place any deadline on completion of projects.... The third quarter update to the 2013-2014 plan reflects 19 additional projects that have become priorities and/or guidance we have published during the period from January 1, 2014 through March 31, 2014 of the plan year." [A list of employee benefits projects begins on page 5.] (Internal Revenue Service [IRS])

You Can Get Help Unraveling Your Pension Benefits
"Developing a financial plan for retirement can be a challenge. You will need to navigate the waters of federal and state regulations, Social Security income, investments and, as you have found out, the world of changing corporate pension policies. If your financial planner is to develop a retirement income strategy to meet your goals, your advisor will need pension information from your previous employers. You can start gathering that information by contacting the New England Pension Assistance Project[.]" (Providence Journal)

New Mortality Table Recommended by Society of Actuaries
"The most significant piece of [Exposure Draft RP-2014] is the new set of generational mortality tables. These tables reflect significant improvement in mortality relative to the rates in the current regulatory framework (RP-2000 plus Mortality Improvement Scale AA). To put that in English: the conclusion of the [Society of Actuaries] is that the current rules significantly understate how long DB plan participants will live because they do not reflect changes (improvements) in life expectancy that have happened since Scale AA was published." (October Three Consulting)

Public Pension Plan Investment Return Assumptions (PDF)
"Although public pension funds, like other investors, experienced sub-par returns in the wake of the 2008-09 decline in global equity values, median public pension fund returns over longer periods meet or exceed the assumed rates used by most plans....[At] 9.0 percent, the median annualized investment return for the 25-year period ended December 31, 2013, exceeds the average assumption of 7.72 percent ... while the 10-year return is below this level.... Among the 126 plans measured in the Public Fund Survey, more than one-half have reduced their investment return assumption since fiscal year 2008." (National Association of State Retirement Administrators [NASRA])

Fifth Circuit Widens Split on Firestone, Reviews Fiduciary Breach Claim De Novo
"Despite finding no fiduciary breach in a plan trustee's decision to pay legal fees with plan assets, the court rejected the trustee's argument that his actions were entitled to deferential judicial review under [Firestone] ... In a footnote, the court explained that Firestone applied only to benefit denials and didn't govern suits for fiduciary breach. This issue -- the extent to which Firestone deference applies outside of the context of benefit denials -- has split the circuits and may be headed for the U.S. Supreme Court." [Futral v. Chastant, No. 13-30856 (5th Cir. Apr. 18, 2014)] (Bloomberg BNA)

[Guidance Overview] IRS Issues Rules for Changes by Safe Harbor 401(k) Plans
"An employer seeking to reduce or suspend its safe harbor contributions for 2014 should consider doing the following to take advantage of the additional flexibility provided by the final regulations: [1] determine whether it is operating at an economic loss; [2] review its safe harbor notice for 2014 to determine whether such notice includes the [required] information ... and [3] arrange for non-discrimination testing to be performed for the plan year." (Wolff & Samson)

Sixth Circuit Provides Guidance for ERISA Penalty Claims
"The [Sixth Circuit] adopts the 'clear notice' standard: '[T]he key question under the clear notice standard is whether the plan administrator knew or should have known which documents were being requested.' Plaintiff's counsel's 'broadly phrased' request should have alerted the plan administrator that this request included the accidental death policy because that was the key document supporting its decision to deny the claim. The court did not abuse its discretion in awarding $55 per day penalty rather than the maximum $110 per day because there was a 'lack of prejudice' caused by the delay." [Cultrona v. Nationwide Life Insurance Company, Nos. 13-3558/3585 (6th Cir. Apr. 9, 2014)] (Lane Powell PC)

Managing Risk and Opportunity: Trends and Challenges in Defined Benefit Plans (PDF)
19 pages. Excerpt: "[R]isk management strategies appear to encompass three distinct categories: plan design, funding and investment, and settlement activities. Almost 50 percent of companies with plan assets in excess of $5 billion plan to manage risk only through investment practices, and none expect to transfer all of their obligations to a third party. In contrast, most plans with fewer than $5 billion in assets are not planning to rely only on investment practices. They also plan to manage risk through settlement activities." (Millennium Trust Company)

[Guidance Overview] DOL Releases Proposed 408(b)(2) Fee Disclosure 'Guide' Regs (PDF)
"Underlying the proposed regulation is the DOL's assumption that providers have 'specialized' knowledge enabling them to more easily locate fee information... Also underlying the proposed regulation is the assumption that a provider's specialized knowledge will reside in a single 'financial ... or similar professional' through whom the provider may quickly construct the guide for any given service.... Since these guides can 'make or break' the use of the exemption, it is hard to imagine that the guide will not require several levels of review at the business, compliance and legal level, as well as a review by 'plain English' editorial staff.... Even if one assumes that a guide would take a business person and a lawyer working together three to four hours per plan, at perhaps $1000 per plan, the cost of such a requirement would be 684,000 times $1000 ($684,000,000), or more than 17 times the benefit ($40,300,000) described in the cost analysis." (Steptoe & Johnson LLP)

SSA Letter-Forwarding Program Discontinued
"Until ... DOL and IRS guidance are updated, plans might consider supplementing the remaining required methods with additional mechanisms suggested by the agencies, such as Internet searches, commercial locator services, and credit-reporting agencies. If the cost of these additional search options will be charged to participants' accounts, plan fiduciaries must consider the size of a participant's account in relation to the cost of the search when deciding whether the search option is appropriate for that participant." (Thomson Reuters / EBIA)

Helpful Tips to Prepare for a Retirement Plan Financial Audit (PDF)
"What is the 80-120 Rule? ... Under what conditions can small plans waive the requirement for a plan audit? ... What are the filing requirements for 403(b) and other non-ERISA retirement plans? ... When are limited-scope audits worthwhile? ... Is your auditor helping you become IRS audit-ready?" (Belfint, Lyons & Shuman for Legg Mason)

Unpaid Employer Contributions as Plan Assets: Expansion Of Liability Under ERISA
"In a distinct trend, federal courts have found that, depending on the text of the underlying plan documents, unpaid employer contributions due under a CBA may be viewed as plan assets, such that the representatives of an employer who exercise fiduciary control over those plan assets can be held individually liable for the unpaid amounts (together with interest and penalties) under ERISA. These cases will no doubt help plan trustees and administrators collect monies owed to the plan. They also should serve as cautionary warnings to contributing employers to ensure that they fully understand the obligations that they are undertaking when they agree to contribute to ERISA funds pursuant to CBAs." (Proskauer Rose LLP)

IRS Safe Harbor for Accepting Rollover Contributions: on the Interplay Between Rev. Rul. 2014-9 and Form 5310
"The Form 5310 Application for Determination for Terminating Plan instructions, updated in December 2013, added an odd and time-consuming new requirement, 'Submit proof that any rollovers or asset transfers received [during the year of plan termination and five prior plan years] were from a qualified plan or IRA (for example, DL [determination letter] and timely interim amendments).' ... [E]ven if the administrator were attempting to rely on the safe harbor with respect to an invalid rollover, which is not what is happening when the employer requests a determination letter, the administrator would not have that type of documentation." (Porter Wright Morris & Arthur LLP)

[Guidance Overview] DOL Proposes Qualified Plan Fee Disclosure Guide
"Pending the finalization of this proposed rule, an employer should consider doing the following to assess the adequacy of the fee disclosures provided by the plan's covered service providers: [1] review the disclosures already provided to determine if the 'basic framework' information has been provided; [2] request a specific analysis of the fees and how they are calculated, and a glossary of terms and examples to assist in the review of the analysis; and [3] review any recordkeeping agreement or investment adviser's agreement to determine how fees contractually are required to be disclosed." (Wolff & Samson)

District Court Rejection of Challenges to Verizon Annuity Purchase Supports Derisking Strategy (PDF)
"[T]he court simply reiterated its prior ruling that Verizon was not acting as fiduciary when it amended the plan to direct the annuity purchase because 'the disputed decisions involve Verizon's role as settlor, not Plan fiduciary' ... [T]he court rejected the claim that Verizon's decision to purchase annuities from a single provider, Prudential, the day after it amended the plan to provide for it, was a fiduciary breach.... [T]he court stated, 'at bottom, plaintiffs are disagreeing with the rights of a settlor under ERISA, and such a disagreement must be addressed to Congress through requests for legislative changes to ERISA, not through litigation that complains of the decisions that ERISA empowers a plan sponsor as settlor to make.'" [Lee v. Verizon Communications, No. 3:12-CV-4834-D (N.D. Tex. Apr. 11, 2014)] (Groom Law Group)

[Opinion] Hundreds of Thousands of Participants Could Lose Benefits If Closed DB Plan Testing Issue Is Not Fixed (PDF)
"A nondiscrimination testing rule contained in U.S. Treasury Department regulations will effectively compel many defined benefit plans across the country to completely freeze all benefits in the next few years... The American Benefits Council has for several years been proposing a very simple solution. If the grandfathered group is a nondiscriminatory group when the plan is first closed (or at a later date), then the plan is permitted to be tested with the employer's defined contribution plan on a benefits basis.... We urge Congress to move forward with that legislative proposal to prevent hundreds of thousands of participants from losing benefits." (American Benefits Council)

[Official Guidance] Text of Social Security Notice of Discontinuation of the Letter Forwarding Service
"In recent years, the internet offers a rapid expansion of locator resources via free social media Web sites and for pay locator services. The public now has widespread access to the Internet and the ability to locate individuals without relying on our letter forwarding services. Based on the availability of the alternative locator resources and the effects it would be as a cost saving measure, we are discontinuing the letter forwarding service. This decision is in line with the Internal Revenue Service, which successfully eliminated part of its letter forwarding workload as of August 31, 2012." (Social Security Administration)

Text of CBO Cost Estimate for PBGC Proposals in the President's 2015 Budget (PDF)
"The President's Budget proposes to give PBGC the authority to set premium rates in both the single employer and multi-employer programs, but does not specify how to allocate the premium increase across the two programs. For this estimate, CBO assumed that 75 percent of the increase would be for the single employer program and 25 percent for the multi-employer program. CBO projects that the multi-employer revolving fund will be exhausted in 2021." (Congressional Budget Office)

[Opinion] Text of Letter from American Academy of Actuaries to Congressional Leaders on on Risks of Using Pension Provisions as Revenue Offsets (PDF)
"In evaluating the current [PBGC] premium level and structure, as well as possible changes thereto, primary consideration should be given to the risks inherent in the pension system and the effects on all stakeholders. These issues are not being appropriately considered when premium-increase proposals are added to unrelated legislation as a 'pay-for' to enable other priorities. Further premium increases will increase the cost of plan sponsorship and could accelerate the rate of plan closures, plan terminations, and other sponsor efforts to transfer risks to participants, which include offering lump sum distributions to current retirees." (American Academy of Actuaries)

The Risks of Derisking DB Plans
"Assets that left the plan early in 2012 and 2013 missed out on the double-digit return potential of those years. When participants are offered a lump sum election opportunity, those in poor health are more likely to accept the offer ... Thus, the plan may be subject to more unfavorable mortality experience ... [A] lump sum transaction is likely to decrease a plan's funded status ... and will have to maintain a certain funding level in order to avoid lump sum restrictions. The lower funded status will generally result in higher plan sponsor contribution costs. It may also result in a higher PBGC variable-rate premium." (Milliman, via Actuarial Digest)

PBGC Announces 'My PAA' is Ready for 2014 Premium Filings
"My PAA has been updated to reflect recent changes to the premium regulation (first effective for 2014 plan years) as described in the 2014 premium filing instructions. Comprehensive filings for plan years beginning in 2014 may now be electronically submitted via My PAA. Information about how to e-file via My PAA (e.g., Demos and FAQs) is on the Online Premium Filing with My PAA page ... A reminder[:] the new rules have no impact on premium filings for plan years beginning in 2013 (e.g., small calendar plans whose 2013 premium filing is due April 30th, 2014)." (Pension Benefit Guaranty Corporation [PBGC])

PBGC Secures $208M for Saint-Gobain Retirees
"Under a settlement with the [PBGC], Saint-Gobain Containers, Inc., has made $207.5 million of additional contributions to its pension plan.... The settlement will help preserve the plan and resolves PBGC's concerns about the plan's sponsor being sold to a company with fewer financial resources.... PBGC pressed the parties for better funding because the sale put retirement benefits at risk by moving the plan from a financially strong sponsor to Ardagh [(a Luxembourg-based glass and metal packaging company)], which carries a high level of debt. When the parties [had] declined to provide financial protection for the plan, PBGC took steps to terminate the plan to protect retirement benefits." (Pension Benefit Guaranty Corporation [PBGC])

BrightScope Goes on Hiring Spree to Capture Revenues from Hot New Market
"[T]he ultimate proof that BrightScope may finally have gotten on track to a bright future as a data company are late developments about who is seeking the better data that it sells -- the 401(k) providers and recordkeepers themselves. The firm has 25 enterprise clients described as recordkeepers and asset managers who want BrightScope, Inc. to clean up their fragmented data making it cleaner and easier to read. They also want BrightScope to help them use the data to increase sales. By the end of the year, BrightScope hopes to have 40 of these big clients[.]" (RIABiz)

Deadlines Coming for Multinationals' Retirement Plans and U.S. Taxpayers with Foreign Financial Interests
"The enforcement mechanism for FATCA is a new 30 percent withholding tax on U.S. source investments of [foreign financial institutions (FFIs)], including investments of foreign retirement plans. The tax applies not just on dividends, but on the gross proceeds of the plan's U.S. investments and not just on the U.S. taxpayer participant's interest in the plan, but rather on the plan's total U.S. source income. Paying agents will start withholding on July 1, 2014, unless given notice that the recipient foreign retirement plan is in compliance with FATCA. Funded foreign retirement plans are considered to be FFIs subject to FATCA, with some important exceptions." (Pillsbury Winthrop Shaw Pittman LLP)

[Opinion] Text of Comments by American Benefits Council to Treasury Department on Proposed Liquidity Shortfall/Funding Regs (PDF)
"[T]he proposed regulation, Section 1.430(j)-1(f), Example 11, Paragraph (iii), states that ... the contribution continues to be required even though the shortfall no longer exists, contrary to the applicable statutory language ... Application of such a rule would lead to plan sponsors having to make disproportionate contributions, in many cases contributing for the exact same shortfall multiple times. This is not consistent with the statute, prior interpretations of the same language, or sound administration of the law." (American Benefits Council)

2014 Survey of DC Plan Consulting Support and Trends (PDF)
"Fastest-growing DC areas reported by consultants include: Total plan cost/fee studies; DC investment design; Investment default asset allocation creation (e.g., target dates, balanced fund); DC recordkeeping searches; [and] Manager selection and monitoring... Consultants believe that the perceived mitigation of fiduciary risk (72%) and the ability to hand over reins on investments (66%) are the leading drivers of growth for outsourced CIO or discretionary oversight of assets.... The majority of consultants (59%) indicate that some or most of their plan sponsor clients prefer to retain retiree assets. Over a fifth (21%) indicate that some or a majority actively seek to retain these assets. Only two firms (4%) reported that the majority of their clients prefer that retirees move out of their plan." (PIMCO)

Ninth Circuit: 'Reopening' a Claim, After the Statute of Limitations Has Run, Does Not Waive That Defense
"If the statute of limitations has already run, does the claim administrator 'waive' the statute of limitations defense by agreeing to reopen a claim? NO.... Even when MetLife 'reopened' the claim in 2009, five years after claim denial, the 2004 statute of limitations defense applied, barring the 2011 lawsuit. This also is a good case to review because it discusses how an appeal denial letter should be written, when considering the statute of limitations defense." [Gordon v. Deloitte & Touche, LLP Long Term Disability Plan, No. 12-55114 (9th Cir. Apr. 11, 2014)] (Lane Powell PC)

[Official Guidance] Text of 2014 PBGC Premium Payment Instructions (PDF)
"Electronic filing is mandatory for all plans.... This document provides information for plans paying premiums for plan years beginning in 2014, including instructions for each data element that must be reported. If you are filing for a previous year, you must follow the instructions for that year." (Pension Benefit Guaranty Corporation [PBGC])

[Guidance Overview] FINRA's 'Reminder' About Rollovers Is News to Many
"[R]egulators believe that industry practices encourage retirees to make rollovers without a full understanding of their options and the relative costs for each option.... Couched as a 'reminder,' FINRA's year-end Regulatory Notice 13-45 describes practices that many broker-dealers and their registered representatives will find difficult to implement.... The guidance lists ... factors that broker-dealers and their registered representatives must consider and evaluate to determine whether a recommendation to take a distribution and rollover is suitable. In practice, broker-dealer firms and their representatives will have a difficult time obtaining this information." (DrinkerBiddle)

Watch Out for the 'Risk' in Derisking!
"From a plan management standpoint, once a plan hits its 'peak liability' -- the inflection point where benefit payments will trump the interest cost and service cost going forward -- a plan sponsor has very little time.... Plan events such as lump-sum windows, group annuity purchases, and even full-scale terminations are quite popular these days as plan sponsors look to reduce the size of their pension plan liability. It's important to remember, though, that these derisking strategies are fiduciary events." (Vanguard)

[Opinion] Text of Comments by Several Trade Associations to DOL on Proposed 408(b)(2) Guide Requirement (PDF)
"DOL is using the issuance of the Proposed Rule as an opportunity to collect information from the public in order to make findings necessary to adequately demonstrate that the guide (i.e., the proposed data collection) contemplated by the Proposed Rule is (i) necessary for the proper performance of the functions of the agency, and (ii) will have practical utility. Accordingly, DOL has not completed the threshold steps of determining whether the guide is in fact needed or will be useful to plan sponsors, nor has it developed a realistic estimate of the total time required for [affected] service providers to prepare the guide." (The SPARK Institute, Investment Company Institute [ICI], SIFMA, ACLI and American Bankers Association)

The Equitable Allocation of Revenue Sharing (PDF)
"[If] a plan does not specify how to use revenue sharing (and most don't), then committees must make prudent decisions about the allocation.... In most cases, recordkeeping expenses are allocated pro rata to the accounts of the participants -- when they are not paid by revenue sharing. As a result, this method is equivalent to allocating the revenue sharing on a pro rata basis to the participants. But, do plan committees understand that, as a legal matter, they made that decision? What documentation do they have to support that they engaged in a prudent process to reach that decision?" (Fred Reish, for Paychex)

[Official Guidance] Text of PBGC Monthly Interest Rate Update for May 2014
"The May 2014 interest assumptions under the benefit payments regulation will be 1.50 percent for the period during which a benefit is in pay status and 4.00 percent during any years preceding the benefit's placement in pay status. In comparison with the interest assumptions in effect for April 2014, these interest assumptions are unchanged." (Pension Benefit Guaranty Corporation)

'Before It's Too Late: A Retirement Security Newsletter from Phyllis Borzi', April 14, 2014
"The Employee Benefits Security Administration and the Certified Financial Planner Board of Standards, Inc. (CFP Board) have some new online tools that can help you get organized, make informed decisions, and plan for a more secure financial future, including a secure retirement." (U.S. Department of Labor)

What to Do With Your 401(k) When You Retire
"The ability to invest in nearly anything is a central attraction of an IRA ... as is the chance to get away from the extra administrative costs and pricey fund options that dog some 401(k) plans. Other respondents said they chose to roll over multiple 401(k) accounts from multiple employers to a single IRA for convenience and simplicity.... Several respondents said they had in fact chosen to stay put in their high-quality, low-cost plans, citing extra creditor protections and the ability to pick up a bit of extra yield in a stable-value offering." (Morningstar)

[Guidance Overview] IRS Ruling Streamlines Plans' Acceptance of Rollover Contributions
"This ruling should be welcomed by plan sponsors and TPAs for its streamlining of the rollover process. Prior examples of 'reasonably concludes' (in Treasury regulations) contemplated employees obtaining documentation from the distributing plan and submitting it to the receiving plan, leading to potential delay and frustration for employees and administrators -- and, as the IRS news release notes, to employees taking taxable distributions instead of continuing their tax-deferred savings." (Thomson Reuters / EBIA)

[Guidance Overview] Filling in the Retirement Plan Gaps for Same-Sex Couples: What It Means for Your Retirement Plan
"While the IRS guidance is certainly welcome and provides clarity on amendment and retroactive application, this only applies to plan qualification and not claims under Title I of ERISA. The [DOL] has not yet provided similar guidance on applying the Windsor decision. In the interim, there is uncertainty regarding whether a participant or beneficiary (such as a same-sex spouse) can make a benefit claim for a retroactive application of Windsor. Further, due to the gap period from June 26, 2013 to September 15, 2013, plan sponsors must carefully consider whether to apply the state of domicile rule or the state of celebration rule." (Ogletree Deakins)

[Guidance Overview] Do Your Qualified Retirement Plans Recognize Same-Sex Spouses as of June 26, 2013?
"[In] Washington state, plan sponsors should introduce procedures to ensure that they are aware of any same-sex registered domestic partnerships that will be automatically converted into marriage as of June 30, 2014. These new spouses will be entitled to all spousal benefits under an employer's plans." (Davis Wright Tremaine LLP)

Fourth Circuit Finds Use of Age-Based Contributions to Public Pension Plan Causes Discrimination Under ADEA
"[T]he Fourth Circuit ruled that a Maryland public employee retirement plan violated the Age Discrimination in Employment Act (ADEA) by requiring greater contributions for participants that enrolled at later ages.... Because much of the opinion was grounded in the fact that employees could retire after a stated number of years of service that did not depend on age, the court's decision may not apply to a situation where employees can retire only after attaining a certain age." [EEOC v. Baltimore County, No. 13-1106 (4th Cir. Mar. 31, 2014)] (Cheiron)

Chart of Rollover-Eligible Retirement Plans and IRA Combinations (PDF)
BenefitsLink came across this handy unofficial chart on the IRS web site. It is a one-page summary in the form of a table, listing the eight kinds of plans and IRAs that can make rollover-eligible distributions, and the corresponding eight kinds of plans and IRAs into which those distributions can (or cannot) be rolled over. (Internal Revenue Service [IRS])

[Guidance Overview] New Same-Gender Marriage Guidance; Part 4: Effect on 403(b) Plans
"While the Windsor decision and the related IRS guidance (including the effective date rules in Notice 2014-19) apply to 403(b) plans, the effect is more limited than with qualified plans because relatively few rules dealing with 403(b) plans deal with spouses. For example, because the entities which sponsor 403(b) plans do not have owners, ownership attribution is irrelevant.... Many 403(b) plans sponsored by tax-exempt organizations are subject to ERISA. If so, these plans must either comply with the QJSA/QPSA rules, or else (very commonly) the plan must provide that the spouse is the 100% death beneficiary unless the spouse consents to naming another beneficiary." (SunGard Relius)

[Guidance Overview] Multiemployer Pension Plans May Need Amendments to Comply with IRS Guidance on Same-Sex Marriage Provisions
"The Notice requires that amendments be adopted by a multiemployer pension plan as follows: [1] If the plan's terms with respect to the requirements of section 401(a) define a marital relationship by reference to section 3 of DOMA or are otherwise inconsistent with the outcome of Windsor or the guidance in Rev. Rul. 2013-17 or the Notice, then an amendment to the plan that reflects such outcome or guidance must be adopted. [2] An amendment is required if a plan sponsor chooses to apply the rules with respect to married participants in a manner that reflects the outcome of Windsor for a period before June 26, 2013. The amendment must specify the date as of which, and the purposes for which, the rules are applied in this manner.... For a multiemployer pension plan, an amendment required in [1] is not subject to the requirements of section 432 of the Code ... while an amendment required in [2] is subject to those requirements." (Cary Kane ERISA Lawyer Blog)

Another Federal Judge Rejects 'Church Plan' Exemption for a Catholic-Affiliated Hospital
"[T]his decision ... has broad implications for employers who currently rely on the church plan exemption based on the entity's 'association' with a church. If these plans are not church plans, they will be subject to ERISA and face allegations of ERISA violations. With two district courts now rejecting application of the church plan exemption to non-profit hospital systems that are affiliated with the Roman Catholic Church, we await decisions in the three other pending church plan cases." [Kaplan v. Saint Peter's Healthcare System, No. 13-2941 (D.N.J. Mar. 31, 2014)] (Alston & Bird, LLP)

New Pension Rules for Cooperative Small Employer Charity Plans
"This legislation would amend ERISA to establish minimum funding standards for [Cooperative Small Employer Charity (CSEC)] pension plans and set rules governing contributions to [them]. The bill is designed to help charities and cooperative associations by implementing pension funding rules that reflect the unique designs of their CSEC plans, rather than subjecting these plans to the funding rules of the Pension Protection Act (PPA)[.]" [H.R. 4275 was signed by President Obama on April 6, 2014.] (Wolters Kluwer Law & Business)

Four in Ten Employers Believe ACA Has Impacted Their Retirement Savings Plans
"43 percent of employers report the [ACA] has affected their current retirement benefits strategy and spending, and 45 percent believe ACA will change their retirement plans in the future. Of those who believed the ACA has changed their retirement benefits strategy, 55 percent said they are spending less money on retirement benefits and shifting costs to employees and 42 percent said they are spending less time evaluating their retirement benefits[.]" (LIMRA)

Hibernation Versus Termination: Evaluating the Choice for a Frozen Pension Plan
"As a frozen corporate defined benefit pension plan matures, the need for a decision on exit strategy gets closer. One option is plan termination (the purchase of annuities for all participants, which effectively transfers all liabilities to an insurance company). Another strategy is 'hibernation,' whereby the sponsor continues to manage the plan at a low level of cost and with some uncertainty about future cost. What are the primary considerations for plan sponsors evaluating the latter option?" (Russell Investments)

[Opinion] Mountains of Paperwork Make 401(k) Transfers a Tough Hill to Climb
"Retirement plan advisers are struggling to help workers roll 401(k) assets into a new 401(k) plan when they change jobs, as record keepers load the process with so much red tape that it's easier to move into individual retirement accounts.... Moving assets from one employer to another, in theory, should be intuitive. The transfer ought to take place between the plans and their record keepers so the individual worker doesn't have to worry about receiving a paper check, or about rolling it over within 60 days of receipt[.]" (InvestmentNews)

[Guidance Overview] Investment Advisers to Plans May Be Required to Deliver 'Disclosure Guide' Under ERISA
"[U]nless revised or clarified, the Proposed Amendment would presumably prohibit a covered service provider from including the guide as an exhibit or attachment to another document ... [It] is possible that a covered service provider would need to deliver a guide even in situations where it had already sent out 408(b)(2) disclosures in compliance with the Final Regulations. Further, even those covered service providers that have already delivered a form of guide might need to deliver a new one if the original delivery did not comply with the requirements of the Proposed Amendment ... [A] failure to deliver the guide in accordance with the requirements of the Proposed Amendment would be treated as a failure to comply with the requirements of the ERISA Section 408(b)(2) 'necessary services exemption', potentially resulting in a non-exempt prohibited transaction if no other exemption is available." (Proskauer Rose LLP)

Why Every Retirement Committee Needs a Custom Charter
"A well-written charter should advise the retirement committee of the sponsor's overall retirement planning philosophy, where the organization's retirement plan should be heading and what path it should take. It should also provide helpful review milestones and directions for handling situations where something may go wrong. Moreover, a charter can maximize the retirement plan's outcomes for both the organization and the plan participants by supporting the organization's workforce-planning objectives and helping the participants prepare for a financially secure retirement." (Sibson Consulting)

[Guidance Overview] Better Late Than Never: IRS Issues Long Awaited Guidance for Retirement Plans Regarding Application of Windsor Decision
"The FAQs clarify that the Notice applies to 403(b) plans; however, the Notice has limited application to 403(b) plans that are not subject to ERISA.... [F]or those plans ... the term 'spouse' is relevant for the required minimum distribution and direct rollover rules but not the qualified joint and survivor annuity and qualified preretirement survivor annuity rules ... The timeline [in this article] summarizes the applicability of the Windsor decision and the supplemental guidance with respect to retirement plans[.]" (Quarles & Brady LLP)

U.S. FATCA Form Released, Deadline Deferred and IGAs Implemented
"The new Form W-8BEN-E is fairly complex. Sponsors of retirement plans that are exempt from FATCA should examine the form and prepare to file it with their payors of U.S. investment income. Unfortunately, the IRS has not yet released form instructions ... Sponsors of retirement plans that are not exempt from FATCA and therefore need to register with the IRS and agree to identify U.S. account holders to avoid default FATCA withholding on such plans will have a modest extension to do so, until May 5, 2014." (Towers Watson)

[Guidance Overview] IRS Releases Guidance for Effective Date of Same-Sex Spousal Retirement Rights
"[T]he limits on retroactivity described in IRS Notice 2014-19 only apply for tax qualification purposes. As such, the IRS guidance does not provide relief from any individual claims that a same-sex spouse may seek to bring asserting spousal rights for retirement plan benefits accruing before the Windsor decision. Absent any subsequent administrative relief (which is not expected), it appears that any such claims must be handled through a plan's claim and appeals procedures and, perhaps ultimately, the courts." (Morgan Lewis)

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